updated 7/2/2008 9:54:36 PM ET 2008-07-03T01:54:36

The Pentagon's inspector general is resigning after just over a year in the job and at a time when defense spending has skyrocketed but personnel shortfalls in the oversight office have strained its ability to probe allegations of waste, fraud and abuse.

Claude Kicklighter, 74, took over as the military's top investigator in April 2007. He'll be replaced by Gordon Heddell, the Labor Department's inspector general since January 2001.

The Defense Department announced the changes Wednesday. It's not clear if Heddell, who will hold the post in an acting capacity, will be officially nominated for the position.

Kicklighter's departure marks yet another shift in leadership at this key Pentagon office. In September 2005, Joseph Schmitz resigned to be chief operating officer and general counsel for the Prince Group, which owns security contractor Blackwater Worldwide.

'Embattled office during a time of war'
Schmitz's more than three-year tenure as Pentagon inspector general was marred by allegations he improperly interfered with two ongoing investigations to protect senior Bush administration officials. An independent inquiry later cleared Schmitz of any wrongdoing.

David Laufman, a federal prosecutor with GOP credentials, was selected to replace Schmitz. But Laufman's nomination was derailed after he testified that he would consult with the defense secretary before embarking on cases involving national security and other sensitive matters.

Members of Congress, including Senate Armed Services Committee Chairman Carl Levin, D-Mich., said the remarks raised questions about Laufman's credibility and his independence. In late 2006, after the panel declined to hold a vote to confirm him, Laufman withdrew himself from consideration.

A deputy inspector general, Thomas Gimble, ran the office after Schmitz left and until Kicklighter arrived.

Kicklighter, who had retired from the Army in 1991 after a 35-year career, was viewed as a solid choice when the defense budget was nearing $600 billion a year and procurement fraud cases in Iraq and Afghanistan were on the rise.

After retiring from the military, Kicklighter held senior positions at the Defense, State and Veterans Affairs departments before becoming inspector general.

"Inspector General Kicklighter took over an embattled office during a time of war," Sen. Charles Grassley, R-Iowa, said in a statement to The Associated Press. "He has been instrumental in beginning to turn the office in a new direction. I very much appreciate his willingness to try and create a transparent and open environment in a place that has a history of poor management and appears to know very little about its role within the Department of Defense."

Grassley, a senior member of the Senate Finance and Judiciary committees, was a vocal critic of Schmitz.

Office lacks manpower
In a March 31 report to Congress, Kicklighter's office outlined major challenges in overseeing the military's perpetually growing budgets and bureaucracy.

The office estimated that nearly half of the military's $316 billion weapons budget went unchecked last year because the IG's office lacked the manpower. A decade ago a single auditor would have reviewed some $642 million in defense contracts, individual investigators are now charged with auditing more than $2 billion in spending.

The inspector general's office also has been stretching its staff to investigate corruption and fraud cases overseas, primarily in Iraq and Afghanistan where tens of thousands of contractors have been hired to help run operations.

"The continual degradation of audit resources that is occurring at a time when the (Defense Department) budget is growing larger leaves the department more vulnerable to fraud, waste and abuse and undermines the department's mission," the report states.

"Our coverage of high-risk areas and defense priorities is weakened and will continue to be weakened by insufficient personnel to accomplish our statutory duties," it adds.

Kicklighter has accepted a teaching position at George Mason University in Fairfax, Va. He will be executive director of the university's Critical Infrastructure Protection Project.

A spokeswoman for the inspector general's office said Kicklighter's resignation is not related to the personnel shortfalls.

Copyright 2008 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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