The Pentagon is set to terminate $5.1 billion in IT service contracts, as ordered by U.S. Defense Secretary Pete Hegseth, according to a memo dated April 10, 2025, a move that is expected to result in significant savings.
The terminations, which affect companies such as Accenture and Deloitte, were described by Hegseth as representing “non-essential spending on third party consultants” for services that Pentagon employees are capable of performing. The memo, released by the Pentagon, highlighted the Secretary’s efforts to optimize resource allocation within the department.
Hegseth emphasized that the terminated contracts amount to “$5.1 billion in wasteful spending” and are estimated to yield nearly $4 billion in savings. This move is part of a broader effort to streamline operations and reduce reliance on external consultants for tasks that can be handled internally.
The decision to terminate these contracts underscores the Pentagon’s commitment to fiscal responsibility and efficient use of resources. By assuming responsibilities currently outsourced to contractors like Accenture and Deloitte, the Pentagon aims to not only cut costs but also enhance its internal capabilities.
