Amid news of Congress allotting $200 million to the secretive Replicator program in a new spending deal, senior defense officials told Inside Defense in an exclusive interview that an inaccuracy was made in Replicator's published -- and later corrected -- fiscal year 2025 budget request, leading to an inside look at the Pentagon's internal decision-making process.
Multiple senior defense officials who discussed the matter requested anonymity to talk about internal Pentagon deliberations, highlighting the sensitivity (and anxiety) that public discussion of the mostly classified Replicator program has caused in recent months.
The Pentagon has been tight-lipped about the details of the program, which aims to field thousands of “attritable,” autonomous drones between February 2025 and August 2025, since it was first announced last August.
At issue, is a publicly released budget document detailing the Pentagon’s FY-25 request for the Defense Innovation Unit which stated that DIU, the organization tasked with leading the Replicator initiative, was set to transfer $67 million to the military services to finance the development and acquisition of Replicator systems.
The document, released March 11, said that the $67 million transfer would have left DIU with a requested FY-25 budget of $109.6 million compared to the previous president’s base budget expectation of $176.3 million.
“The decrease of $67 million represents funds realigned to Service RDT&E and Procurement PEs to fund Replicator selected efforts needed to meet operational needs,” the document stated.
However, multiple senior defense officials told Inside Defense that this information, which has since been deleted from the budget request, was false.
“It was removed because it was inaccurate,” one senior defense official said.
The official said that the inaccuracy stemmed from the previous president’s base budget expectation for FY-25 being listed incorrectly as $176.3 million, causing $67 million to be incorrectly deduced.
“It’s inaccurate because it was subtracting from a number that was inaccurate,” the official said. “If you say A minus B equals 67 and either A or B is wrong than 67 is wrong.”
The document initially said the previous year’s projected FY-25 budget for DIU had been $176.3 million. However, the official said that projection should have been listed as $95.2 million, which the budget now reflects.
The inaccurate number, the official said, was “an internal position advocated by the particular office that does not track with what the final decision was.”
Meaning that was the amount DIU had internally advocated for receiving and realigning to the military services for Replicator.
The information about the “Replicator Realignment,” the official said, should not have moved beyond internal use.
“That part really wasn’t appropriate for publishing in any case,” the official said. “Whether the ending position for the DIU budget, you know, would have been something else, had it not been for Replicator, is an internal thought process . . . it didn’t belong in a Jbook.”
However, this number was listed multiple times in the budget book, as well as including a justification for the transfer of funding. The officials said the justification statement was simply a mistake that was not caught.
“There is a DIU program, so therefore somebody has to be writing [a justification] up, if they wrote it incorrectly, and that’s what appears what happened, then an incorrect piece of paper got sent [to Congress] that has to be corrected,” the official said.
A second senior defense official said DIU’s staff is working to expand its size to prevent such internal information from being released in the future.
“I think it’s . . . an outcome of a very skeleton DIU team that we are working to grow, we are working to fit into the government processes,” the second official said.
There has also been a new focus, the second official said, on creating “more of that governance around DIU” as it has increased its profile and become a direct-report unit to Defense Secretary Lloyd Austin.
“We will have better governance and checks and balances across our work going forward,” the second official said.
The first senior defense official said Congress has been alerted to the inaccuracy and the change.
Pentagon spokesman Eric Pahon said the $67 million realignment in DIU’s budget request was a “factual error.”
“As a standard practice, DIU is working closely with [the] services program execution offices to deliver innovative capabilities to our warfighters,” Pahon said. “Funds will be allocated to the relevant PEOs for selected Replicator capabilities.”
At present, the FY-25 budget request for DIU has no mention of Replicator anywhere.
Hicks in charge
The officials also made it clear that Deputy Defense Secretary Kathleen Hicks is personally overseeing the Replicator initiative and its public messaging strategy.
“We are not choosing, at this time, per the deputy, to disclose which projects -- where Replicator is in the budget, specifically, because of security concerns and not wanting to make our adversaries problem too easy,” the first official said. “The decision of what to so call ‘reveal or conceal’ is the deputy secretary’s decision. So that does hamstring us a little bit maybe about being real precise about the Replicator story in detail because right now the position we have is that that’s a story for our committees, as well as several other programs, for a classified setting.”
On Wednesday, Hicks said she was secure in being the face of Replicator, even if it meant putting her own reputation on the line.
“Obviously, as is quite clear, I am bearing the risk on Replicator. . . . I think it’s a very good risk to take,” she said at the Reagan Institute’s National Security Innovation Base Summit in Washington.
New ‘baselines’ for DIU, Replicator
Meanwhile, Congress released its final fiscal year 2024 appropriations package Thursday, which included $946 million for DIU and $200 million for the Replicator initiative.
Last week, DIU sent a statement to Inside Defense noting that they are “ready to execute the final amount that Congress determines should be in its FY-24 budget.”
The first senior defense official said that if the bill were passed and signed by the president, which happened on Saturday morning, DOD will have a very different “baseline” for DIU and Replicator than what was initially assumed.
“We may want to come revisit with our committees in the coming months [about] how we think about ’25 because ‘24 now is a good bit different,” the official said. “[And discuss] the balance of what DIU’s role would be.”
The official said the money allotted for DIU and Replicator will cause DOD to review how it operates.
“So, there’s a new framework for DIU,” the official said. “And Replicator, of course, wasn’t in the ‘24 budget when we asked for it, so we do appreciate” the support of Congress.
Hicks recently announced that she is seeking $500 million to spend on the Replicator initiative in FY-24 and another $500 million in FY-25. The appropriations package would give Replicator $200 million of that sought money, while a classified reprogramming request seeks the other $300 million.
“Both [DIU and Replicator] are different than what we requested in ‘24 and both of them are new,” the official said. “So, there’s some work, I think, to reconcile the new ‘24 positions, new on DIU, new on Replicator, with the ‘25 budget, that’s pretty well aligned on Replicator, maybe a little bit differently aligned on DIU because it is a fairly big shift in their mindsets.”