Defense Secretary Pete Hegseth announced Thursday that the Department of Defense is cutting $5.1 billion in consulting and IT contracts, calling them “non-essential” and a misuse of taxpayer dollars that could be better spent on America’s warfighters.
According to an April 10 internal memo and Hegseth’s video statement, the move is part of the Trump administration’s broader effort to eliminate waste and redirect funds toward core military functions.
The canceled contracts include $1.8 billion awarded by the Defense Health Agency to private firms such as Accenture and Deloitte for services he says should be handled in-house.
“That’s with a ‘B’—$5.1 billion in DOD contracts for ancillary things like consulting and other nonessential services,” Hegseth said. “We need this money to spend on better health care for our warfighters and their families, instead of $500-an-hour business process consultants.”
The Defense Department is also terminating an Air Force IT services contract, a Navy business consulting deal, and a $500 million project through the Defense Advanced Research Projects Agency that Hegseth described as duplicative of existing efforts.
Additional cuts target 11 contracts tied to climate change, diversity, equity, and inclusion (DEI), and COVID-19 response programs.
“We are committed to rooting out DEI—root and branch—throughout this department,” Hegseth said, adding that more cuts in that area are expected.
In line with a directive from President Trump, the newly formed Department of Government Efficiency (DOGE) has also paused over $500 million in funding to universities that, according to Hegseth, tolerate antisemitism and promote divisive DEI ideologies. That includes Northwestern and Cornell, along with previous funding freezes at four other institutions totaling $70 million.
Hegseth said the DOD’s total savings from wasteful spending have now reached nearly $6 billion in just six weeks, with the DOGE continuing its audits.
Trump established DOGE on January 20 to review and restructure federal agencies, giving it access to government systems through 2026—a move that has prompted legal challenges from some lawmakers and labor groups.
Beyond cutting programs, the Pentagon is shifting focus toward advanced military capabilities such as hypersonic weapons, AI-driven systems, and bolstering the U.S. industrial base.
Hegseth has also ordered military leaders to identify another $50 billion in potential cuts from the previous administration’s 2026 defense budget to fund Trump’s national security priorities.
“Our job is to get rid of the waste and reinvest in real defense,” Hegseth said. “We’re just getting started.”