Hegseth cuts $5.1B in spending on 'wasteful' Pentagon consulting contracts

The memo's subject line Thursday was "Continuing Elimination of Wasteful Spending of the DoD."

The memo, signed on Thursday, canceled Defense Health Agency contracts for consulting services from Accenture, Deloitte and Booz Allen, among other firms, as well as an Air Force contract with Accenture to resell third-party enterprise cloud IT services.

Specifically, the canceled contracts include $1.8 billion in consulting, $1.4 billion enterprise cloud IT services and a $500 million Navy contract for business process consulting.

Hegseth said the work can be performed by the Pentagon's civil workforce.

"That's with a 'B' -- $5.1 billion in DOD contracts for ancillary things like consulting and other nonessential services," Hegseth said in a video Thursday from his office at the Pentagon, calling the contracts non-essential spending.

Hegseth directed the DOD chief information officer, in coordination with the Department of Government Efficiency, to prepare a plan within 30 days for how the department will in-source IT consulting and management services to its civilian workforce and negotiate most favorable rates on software and cloud services.

"We need this money to spend on better health care for our warfighters and their families, instead of $500 an hour business process consultant," he said in a statement announcing the cuts. "That's a lot of consulting."

He also noted cutting a $500 million contract to the Defense Advanced Research Projects Agency for IT help desk services that are "completely duplicative" of services that the Defense Information Systems Agency already provides.

In addition, the Pentagon is cutting 11 contracts related to diversity, equity and inclusion, climate change, the department's response to the COVID-19 pandemic and related nonessential activities across the DOD.

He also announced pausing $500 million in funding to two universities -- Northwestern University and Cornell -- that "tolerate antisemitism and support divisive DEI programs." This is in addition to the $70 million already cut at Columbia, Penn, Brown and Princeton in past weeks.

Hegseth attended Princeton and Harvard.

"We are committed to rooting out DEI -- root and branch -- throughout this department ... I'm going to keep looking," Hegseth said.

The memo said $4 million can be directed to "re-allocate to our mission-critical priorities to Revive the Warrior Ethos, Rebuild the Military, and Reestablish Deterrence."

On March 20, he announced $580 million would be cut in programs, contracts and grants.

"If you're keeping score at home, today's cuts bring our running total to nearly $6 billion in wasteful spending over the first six weeks of the Department of Government Efficiency effort here at the Defense Department," Hegseth said.

On Feb. 20, Hegseth first announced that DOGE would be working on cutting excess and refocusing the department's budget.

"We're excited to make these cuts on behalf of you, the taxpayer and the warfighters here at the department," he said.

On March, 29, he directed the Pentagon to reduce its civilian workforce by 5% to 8 percent over the next several months. This would total 50,000 to 60,000 jobs.

This can be done through early retirement and buyouts with full pay and benefits until Sept. 30. Also probationary workers with less than two years on the job have been let go from federal agencies.

A hiring freeze was ordered on Feb. 28 by Hegseth after President Donald Trump issued a broad civilian hiring freeze over most of the federal government on his first day in office on Jan. 20 as part of efforts to slash the size of the government.

In the DoD, there are some exceptions, including 18 classes of jobs. They include teaching positions at Department of Defense Education Activity schools and on-post day care, medical facilities, immigration enforcement, public safety, recruiting and readiness.

There are 2.1 million people working for the Department of Defense, roughly 950,000 of whom are non-uniformed civilians.

Trump has ordered agencies to eliminate wasteful spending and misaligned with president's priorities. Elon Musk heads DOGE, the temporary agency that has sought to reduce spending through dismantling agencies, such as the U.S. Agency for International Development and the Department of Education.