Planning, Programming, Budgeting and Execution (PPBE)

The Planning, Programming, Budgeting and Execution (PPBE) process is the Department of Defense (DoD) annual system for deciding which programs to fund. It produces DoD's part of the President's budget request and updates the Future Years Defense Program (FYDP), DoD's five-year funding plan (CRS IF10429).

What happens in each PPBE phase?

PPBE has four phases. Planning, led by the Under Secretary of Defense for Policy, produces the Defense Planning Guidance. Programming, led by Cost Assessment and Program Evaluation, produces each component's Program Objective Memorandum (POM), a five-year funding plan. Budgeting, led by the Comptroller, converts the first POM year into a Budget Estimate Submission.

The Comptroller typically sends the budget to the Office of Management and Budget in December, for the President's request to Congress, usually in February. Execution reviews how funds are obligated and spent, and what programs deliver.

Why does PPBE matter for space startups?

PPBE sets the earliest date a program office can budget for a new purchase. Planning for any fiscal year can begin more than two years before the money is spent, so demand created by a Small Business Innovation Research (SBIR) award or a prototype usually has to wait for a future POM.

Funding type matters too. Per CRS R47178, research, development, test and evaluation (RDT&E) funds are generally available for two years, procurement for three, and operation and maintenance (O&M) for one. These categories are called "colors of money." Moving from a prototype paid with RDT&E to a program of record bought with procurement funds requires that procurement money to be planned in advance. Former Google chief executive Eric Schmidt testified that the budget process "creates a valley of death for new technology."

What has changed since the PPBE Reform Commission?

The Commission on PPBE Reform issued its final report on March 6, 2024, with 28 recommendations across five areas (CRS IN12372). The first recommendation was to replace PPBE with a Defense Resourcing System. Others addressed colors of money and proposed transfer authority between RDT&E and procurement around milestone decisions.

Section 1006 of the Fiscal Year 2025 National Defense Authorization Act, enacted December 23, 2024, required DoD to set up a cross-functional team, led by the Comptroller, to oversee implementation and report to Congress every 180 days for three years.