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U.S. missile defense system could see added costs, delays: report

By Andrea Shalal

WASHINGTON (Reuters) - The U.S. missile defense system could see additional costs and delays after several test failures and technical challenges in 2013, a congressional watchdog agency warned in a new report released Tuesday.

The U.S. government has already spent $98 billion since 2002 to develop a complex, layered system to defend against enemy ballistic missile attacks, with an additional $38 billion to be spent through fiscal 2018, according to the report by the Government Accountability Office.

But continued problems with key aspects of the program, including the ground-based midcourse defense managed by Boeing Co, could drive the costs of U.S. missile defense system even higher in coming years, the GAO said.

The report also faulted the U.S. Missile Defense Agency for what it called "unreliable" and incomplete cost estimates, and recommended steps to improve the agency's schedule baselines.

The report said the agency made some significant progress with its acquisition programs in fiscal year 2013, including the first operational system-level flight test involving multiple elements of the Ballistic Missile Defense System (BMDS).

However, two key programs - a new missile developed by Raytheon Co for the sea-based Aegis Ballistic Missile Defense system and Boeing's ground-based system - had test failures in 2013 and further issues to resolve, the report said.

The GAO said the failure of an SM-3 Block 1B interceptor in a September 2013 flight test means that a key component may need to be redesigned, necessitating additional flight testing.

It said there had been three flight test anomalies with the current tied to the recent test failure, and officials were now considering design changes.

The July 2013 intercept failure of the Ground-based Midcourse Defense (GMD) system meant the program was not able to see if software upgrades planned for the entire fleet of ground-based interceptors were effective, it said.

The Missile Defense Agency earlier this month announced plans to redesign the kill vehicle, build a new radar and make other changes to improve the reliability and performance of the GMD system in coming years.

The GAO recommended additional flight testing for both programs, and urged Frank Kendall, the Pentagon's acquisition chief to delay full rate production of several hundred SM-3 Block 1B missiles until the testing proved the missile was effective.

The report also recommended the agency test the Raytheon kill vehicle that failed to separate during the July 2013 test of ground-based interceptors once the cause of the test failure was determined, since that interceptor served as the primary defense of the United States against enemy missile attacks.

The report said the Pentagon partially concurred with the report's recommendation for further testing of the SM-3 Block 1B missile, but said the decision to test the Raytheon kill vehicle would be made by the head of the Missile Defense Agency, based on the judgment of top Pentagon officials and combatant commanders on the need for a test.

The agency has said it plans to test an updated version of the Raytheon kill vehicle this summer, but has not announced its plans for the version of the kill vehicle that failed to separate from the third stage of the rocket last July.

(Reporting by Andrea Shalal; Editing by Bernard Orr)

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