updated 10/25/2004 1:38:09 PM ET 2004-10-25T17:38:09

A new U.S. Army report highlights the risk of giving Boeing Co. a broad, supervisory role over the service’s $100 billion modernisation plan, the Wall Street Journal reported on Monday.

Boeing is spearheading the Army’s Future Combat System, or FCS, which is the centerpiece of the Pentagon’s drive to create more lethal ground forces, the Journal reported.

The program envisions an array of swift manned and robotic vehicles, pinpoint-accurate cannons able to hit targets over the horizon, unmanned spy planes and even advanced satellites, the report added.

But with Boeing embroiled in a widening scandal over tainted Air Force contracts, a recent study commissioned by the Army is said to underscore the risks of giving a single contractor such a broad mandate. The study has not been made public, the newspaper added.

The report — reviewed by the Journal — from the Institute for Defense Analyses, a Pentagon-supported research group, warns that the “Army should adopt a policy of ’Trust but Verify’ with regard to the ethics programs of the FCS industry participants.”

The report has numerous caveats about Boeing’s supervisory role and how potential problems stemming from that could jeopardize FCS, the newspaper reported.

The study warns that if Army participants “become overwhelmed” by the complexity of the effort, they could cede too much power to industry and lose sight of the service’s own goals.

It adds that Boeing and the Army conducted fair and open subcontracting competitions, yet warned that the Army must take immediate steps to bolster its own competence to monitor FCS.

A representative for Boeing was not immediately available for comment on Monday. 


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