Pentagon Terminates $5.1 Billion Worth of Consulting and IT Contracts

The latest round of contract terminations will bring the Department of Defense’s total spending cut to nearly $6 billion, the Pentagon chief said.

An aerial view of the Pentagon in Arlington, Va., on April 2, 2025. Madalina Vasiliu/The Epoch Times

The Department of Defense (DOD) will cut $5.1 billion in consulting and IT contracts that Pentagon Chief Pete Hegseth deemed are non-essential, according to an April 10 memo.

In the memo, Hegseth ordered the DOD to cancel a Defense Health Agency contract with Accenture, Deloitte, and other companies for services that he said “can be performed by our civilian workforce.”

Other contracts to be terminated include an Air Force contract with Accenture to resell third-party Enterprise Cloud IT Services, a Navy contract for business process consulting services, and the Defense Advanced Research Projects Agency’s contract for IT help desk services.

Those contracts, Hegseth said, represent “non-essential spending on third party consultants” for services that highly skilled DOD employees could perform using existing resources.

“By the way, 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 social media video. “That’s a lot of consulting.”

Deloitte and Accenture did not respond to a request for comment by publication time.

Hegseth also ordered the termination of 11 other contracts for consulting services related to diversity, equity, and inclusion (DEI); climate policies, COVID-19 response, and nonessential activities across the department.

“We are committed to rooting out DEI—root and branch—throughout this department, and we found 11 more contracts. We’re going to keep looking,” the Pentagon chief said.

Last month, Hegseth issued another memo directing the termination of more than $580 million in “wasteful spending,” which included a software development program for the Defense Civilian Human Resources Management System and grants related to DEI and climate policies.

He also ordered the cancellation of a $9 million university grant for developing “equitable AI and machine learning models,” saying that the DOD needs lethal machine learning models instead.

According to Hegseth, the DOD has halted more than $500 million in funding to Northwestern University and Cornell University this week, on top of the $70 million already paused at four other academic institutions that he deemed “tolerate anti-Semitism and support divisive DEI programs.”

The latest round of contract terminations will bring the DOD’s total spending cut to nearly $6 billion over the first six weeks of the Department of Government Efficiency’s (DOGE’s) efforts to eliminate wasteful spending within the department, Hegseth said.

“[DOGE’s] job is to go out and find the stuff that we can get rid of, and then flow back into, drive back into war-fighting capabilities here at the Defense Department,” he said in the April 10 video.

President Donald Trump signed an executive order on Jan. 20 renaming the existing U.S. Digital Service as DOGE and tasked it with reviewing federal agencies for potential downsizing and cost reductions. The order states that DOGE’s work is expected to be completed by July 4, 2026.

To conduct audits, DOGE has been granted access to federal systems, sparking legal challenges from some Democratic lawmakers and labor unions who argued the access is unconstitutional.

To support the Trump administration’s efforts to reduce government spending, the DOD has discontinued 91 studies ranging from looking at climate-related issues and global migration patterns to social trends. The DOD said discontinuing them would save the government more than $30 million in the first year.

The DOD said it will instead redirect resources toward “technologies essential for maintaining a strong national defense” and fund research focused on developing and fielding advanced military capabilities.

It aims to invest in key areas such as “hypersonic weapons development, AI-powered systems for enhanced battlefield awareness, and strengthening the domestic military industrial base.”

Hegseth has also directed military officials to identify $50 billion in potential cuts from the former Biden administration’s fiscal year 2026 budget “that could be realigned from low-impact and low-priority Biden-legacy programs” and redirect them toward Trump’s defense priorities.