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Thank you Jim for the introduction, and for the invitation to discuss the President’s Budget request for Fiscal Year 2024 as well as key defense programs that support our Navy, Marine Corps, and our Nation.
As a former small business owner of 17 years in the defense ecosystem, I understand the importance of the capabilities and expertise this audience brings to bear in support of the DoD and the Joint Force.
My relationship with the defense industrial base stretches back even before my wife Betty and I decided to start our own company.
As a career Navy Surface Warfare Officer and former Commanding Officer of USS Bulkeley, I relied on the talents and experience of industry partners to build, maintain, and deploy the ships I served on.
Today, in my role as the “CEO” of the Department of Navy, I am responsible for ensuring our Sailors and Marines have the resources necessary to field combat capabilities for our Fleet and Combatant Commanders around the world.
Our Nation faces challenges around the globe, in every region and domain we operate in, from the seafloor to cyberspace, from the ocean’s surface to the skies above.
We recognize the People’s Republic of China as our pacing challenge in the Indo-Pacific region, as they continue the rapid buildup of their navy to a projected fleet size of 440 ships by 2030.
In Europe, we continue to bear witness to acts of aggression by Russia in their violation of Ukraine’s sovereignty.
The violence we are all seeing against civilians fits the definition of crimes against humanity, as stated recently by both President Biden and Vice President Harris.
Iran and North Korea endure in their campaigns as destabilizing forces in their respective geographic regions to distract from the issues their regimes face at home.
None of these challenges are easy to address without a credible and executable deterrent capability.
Deterrence is only effective if our potential adversaries believe that we, the United States of America, through our Joint Force, will prevail in conflict. A strong Navy and Marine Corps are the foundation upon which the success of the Joint Force rests.
This is why we must always be ready to deploy a naval expeditionary force capable of meeting our defense obligations.
The challenges our Nation faces coupled with our obligations to the American people and our commitments to our international allies and partners are always at the forefront of all I do as I lead the Department of the Navy.
At last year’s conference, I introduced to this audience my three enduring priorities, which still guide the actions and investments of the Department of the Navy. They are: Strengthening Maritime Dominance, Building a Culture of Warfighting Excellence, and Enhancing Strategic Partnerships.
Over the past year, we have made significant progress tied to these priorities, in no small part due to the capabilities our partners in industry have helped us deliver.
In support of our first priority, strengthening maritime dominance, we have achieved much in several key acquisition programs that many of you are a part of.
We continue modernization efforts on the most survivable leg of our Nation’s nuclear triad. Construction continues on our first Columbia-Class SSBN, District of Columbia, with pre-construction activities underway on second-in-class USS Wisconsin.
We are upgrading our Block II F-18 fighter aircraft to the Block III variant, ensuring we have enough fighter aircraft in our inventory to meet the requirements of the Joint Force.
Our Fleet’s newest aircraft carrier, USS Gerald R. Ford, completed its first mini-deployment this past year, in preparation for its first full deployment later this year, marking a milestone for the Ford-Class carrier program.
The lessons we learned throughout the construction, outfitting, and operation of the Ford will be critical as we build out the class with the future Kennedy, Enterprise, and Doris Miller.
Construction on USS Constellation, the first of our Constellation-Class frigates, has also begun. We look forward to adding a highly capable frigate back into our Navy’s inventory to provide Fleet and Combatant Commanders with additional maritime combat power.
In addition to procuring modern platforms, we are also expanding the areas available for our personnel to train.
With our partners in Congress through the National Defense Authorization Act of 2023, we are expanding and modernizing our training range at Naval Air Station Fallon—an endeavor the Department of the Navy has been working on for several years.
This initiative will provide our pilots the airspace necessary to hone their skills in the advanced aircraft we field.
We also saw continued positive trends in ship maintenance periods, with delayed maintenance days on large availabilities in private shipyards decreasing by 58% since FY19.
In our public shipyards, the total number of delayed maintenance days has decreased by 29% since FY19, from 1,529 to 1,088.
Overall, we are observing on-time completion of maintenance availabilities improving at both private and public shipyards.
This trend will continue to improve with the divestment of older platforms that are not fully deployable.
To our teammates in industry involved in this process, I thank you for your hard work helping us move in the right direction, and ask that you continue to engage with us as we strive to improve maintenance performance.
On the innovation front, our Sailors assigned to Task Force 59 in Bahrain continue to test and field unmanned surface vehicles in a challenging operating environment, developing concepts of employment for crewed and un-crewed platforms.
I am committed to increased investment in fielding autonomous systems as a path to modernize our Navy and Marine Corps.
Even more important than our warfighting platforms are our Sailors and Marines, as well as the families who support them.
Our people are indeed our greatest strength, and we continue to make it a priority to request funding to sustain and retain our people. From the largest pay raise in over 20 years, to multi-million dollar investments in family housing and quality-of-life programs, we continue to increase the benefits offered as part of our compensation packages to recruit and retain top talent.
In fact, if this excites some of you here with us today, please see me afterwards to sign you up!
Beyond our relationships with our Sailors and Marines, we continue growing and enhancing our connections with our allies and partners.
One of our most high-visibility relationships is AUKUS, bringing us closer as a Navy with our key allies, the United Kingdom and Australia.
On Monday I was in San Diego with President Biden as he announced, along with his British and Australian counterparts, the next steps of the AUKUS partnership.
Beginning this year, we will be welcoming Royal Australian Navy Sailors and civilian personnel aboard our submarines and installations, as well as embedding them across our submarine industrial base, to support them as they develop their own capacity to field nuclear-powered submarines.
Assisting the Royal Australian Navy with the modernization of their submarine fleet will pay dividends as we continue to press for a free and open Indo-Pacific.
In Europe, the Department of the Navy identified and provided systems, platforms, munitions, and support equipment for our partners in Ukraine.
We remain committed to doing our part in the President’s and Department of Defense’s strategy to support the Ukrainian people as they defend their territory against Russian invasion.
Our ties to nations around the globe are absolutely critical to our national defense strategy—we are stronger standing together; we cannot and do not want to take on our enduring challenges alone.
Equally important are our partnerships here at home. In particular, our Department’s relationship with the defense industrial base as we work together to sustain the Fleet and Force our country requires.
Recently, we saw the value of these government-industry relationships play out with the successful resolution of F-35 fighter jet engine issues.
We also continue to support initiatives to grow and maintain a civilian workforce trained to meet our needs. There is no better example of this than the opening of our Additive Manufacturing Center of Excellence in Danville, Virginia this past October. Graduates of this program will enter the workforce with critical skills we need to support our Fleet.
These efforts will continue with the investment of over $2.3 billion in support to the industrial base over the FYDP.
Additionally, we created new opportunities for private companies to partner with us through the Naval Innovation Center at the Naval Postgraduate School in California and the Marine Innovation Unit in New York.
These two programs will serve as critical resources as we look to increase engagement with industry and academia to identify technologies and systems that bring advanced capabilities to our Sailors and Marines.
I highlight all of this to provide you with tangible examples of how we, with your support, have made progress in advancing the capability and lethality of our Navy and Marine Corps.
However, there is still much work to be done, as proposed by the President’s FY24 Budget Request that sets forth a strong commitment to support to our Navy and Marine Corps team.
The President’s Fiscal Year 2024 budget request, unveiled on Monday, is both a recognition of how far we’ve come during the past year, and a plan to provide us the funding we need to continue making progress across all three of our enduring priorities.
President Biden and Secretary Austin recognize the value a strong Navy and Marine Corps provide in support of our National Defense Strategy, especially when framed against the threats we face.
The President’s FY24 budget asks for $842 billion for the Department of Defense, a $26 billion, or 3.2% increase over Fiscal Year 2023 enacted levels.
Within this budget request is $202 billion for the Navy and $53 billion for the Marine Corps, representing a 4.5% increase in our Department’s budget over what was enacted for FY23.
This is now the second year that the President has requested more than what was enacted by Congress.
This year’s budget supports the acceleration of the Marine Corp’s Force Design 2030 objectives while ensuring we are developing a fleet that supports the Navy’s Navigation Plan.
From development of next-generation platforms and systems, munitions procurement, and shipbuilding, to critical infrastructure improvements, we are making smart investments that build a capable, credible, and lethal force.
On the platform procurement front, the FY24 budget request calls for the purchase of 88 aircraft and nine battle force ships, including two Flight Three Arleigh Burke-Class destroyers equipped with the Advanced Air and Missile Defense Radar.
Of the $32.8 billion requested for shipbuilding,
$10.3 billion is allocated for the Virginia-class fast attack submarine program, including the procurement of two Block Five hulls for FY24. One of these hulls will include the Virginia Payload Module, increasing its Tomahawk capacity from 12 to 40 missiles.
Within our shipbuilding funds request are allocations to support advanced procurement for future construction of new ships and submarines.
The consistency in the shipbuilding plan, to be released soon, provides our industry partners with a predictable ship and submarine build schedule, supporting acquisition of materials and identification of personnel requirements necessary to achieve on-time, on-budget deliveries.
However, we cannot repair and maintain a capable Fleet without the funding necessary to do so.
For FY24, we are asking for the funding required to complete 100% of major maintenance availabilities conducted in private and public shipyards.
We are also dedicating $26.9 billion to R&D, with a special focus on enhanced competitive capabilities.
For next-generation platforms, we are investing $2.3 billion in the development of our next-generation fighter as well as our future advanced attack submarines and follow-on class of destroyer.
Additionally, we are requesting funding to support Amphibious Combat Vehicle development, software upgrades for the Ground/Air Task Oriented Radar, and the integration and testing of the Marine Air Defense Integrated System.
We are adding almost $2 billion for our weapons programs, bringing the total to $6.9 billion. This increase supports an economical, multi-year procurement strategy for several types of munitions.
The infrastructure to support a strong Navy and Marine Corps team is also a top priority.
For FY24, we are requesting $6.1 billion to support 35 construction projects supporting the Guam Defense Policy Review Initiative, aircraft maintenance facilities, as well as quality-of-life improvements such as MWR facilities and child development centers.
Through our Shipyard Infrastructure Optimization Plan, known as SIOP, we are investing $2.7 billion in our public shipyard infrastructure, to include funding for the recapitalization of our aging drydocks.
I am proud that just this past week we signed a $2.8 billion contract to begin work on our drydock in Hawaii.
These facilities are vital to the sustainment of our Virginia-Class attack submarines and Ford-Class aircraft carriers.
Beyond our own shipyards, we are investing in our industry partners. This includes $400 million in funding targeted at shipbuilder infrastructure, supplier and workforce development, technology advancements, and strategic sourcing.
We are also requesting $380 million to support building the capacity of our weapons industrial base.
We need you, our defense industrial base, to be just as strong and resilient as the Sailors and Marines you support day in and day out.
I highlight these select elements of the President’s budget request for the Department of the Navy so that you can begin to identify areas where you can offer support, to include investments and innovations in your own companies that are complementary to ours.
Our Navy and Marine Corps team grows stronger by the day, and will continue to grow because of our relationships with you, our partners in industry.
Thank you for everything you do in support of Navy and Marine Corps. May God Bless our Sailors, Marines, and their families.
Carlos Del Toro
15 March 2023
20 March 2023
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