Pentagon redirected pandemic funds to defense contractors

APD NEWS

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At least 10 of the about 30 contractors awarded with DPA funding also received money from the Paycheck Protection Program (PPP), the Post found.

Jessica Maxwell, a spokesperson for the Department of Defense, told The Hill in a statement that the DPA funding and PPP program are not "in conflict or duplicative."

She said the CARES Act did not restrict the funding to medical resources and certain defense spending was "appropriate as long as they addressed COVID related impacts in the industrial base."

"The law set forth no limitation requiring use only in the medical supply industrial base," she said.

She noted that the law authorized the Department of Health and Human Services to expand the medical resource supply. Maxwell added that economic impacts from the pandemic "necessitated prompt action ... to sustain and strengthen essential domestic industrial base capabilities."

Ellen Lord, the undersecretary of defense for acquisition and sustainment, defended the actions in a statement to the Post.

"We are thankful the Congress provided authorities and resources that enabled the [executive branch] to invest in domestic production of critical medical resources and protect key defense capabilities from the consequences of COVID," Lord said. "We need to always remember that economic security and national security are very tightly interrelated and our industrial base is really the nexus of the two."

The Democratic-led House Appropriations Committee said in a report that the Defense Department's spending on money allocated from the CARES Act was not distributed as intended.

"The Committee's expectation was that the Department would address the need for PPE industrial capacity rather than execute the funding for the DIB (defense industrial base)," the committee wrote in its 2021 defense bill report.

Defense industry groups said the funding was needed to keep certain contractors in business during the economic downturn caused by the pandemic.

(THE HEILL)