IG Finds that DeCA Saved Money By Raising Produce Costs in South Korea and Japan Commissaries

As is often the case, in an effort to save money increased costs were pushed on to servicemembers and their families:

The Defense Commissary Agency has saved tens of millions of dollars shipping produce to the Pacific since 2015. However, a recent inspector general report says the agency failed to provide effective oversight of its new contracts, leaving customers paying significantly more for fresh fruits and vegetables.

In the past, DeCA subsidized contractors’ produce shipments to commissaries in Japan and South Korea, costing the agency about $114.6 million from 2013 to 2015, the IG report said. When contracts were renegotiated in 2015, DeCA stopped paying for shipping, instead aiming to purchase more locally grown produce and having suppliers foot those costs.

Since then, DeCA has saved about $38 million per year.

After the deal was made, prices for fresh produce climbed at Pacific commissaries, according to the report. Between November 2015 and April 2017, customers in mainland Japan paid 20.9 percent more for produce. Over the same period, Okinawa customers saw an increase of 23.6 percent while those in South Korea paid 31.5 percent more.

The report’s findings were based on a review of prices for 239 unique fresh produce items in mainland Japan, 237 on Okinawa and 231 in South Korea.

The 2015 contract’s aim was to keep the quality and cost of produce on base comparable to what they were before the contract, but the IG report says those expectations were not met. It blamed DeCA for the price hike, saying the agency’s “market research did not adequately evaluate the feasibility of obtaining fresh produce items from in-country for DeCA commissaries in the Pacific theater.”  [Stars & Stripes]

You can read more at the link.