Problems with Privatized Household Goods Shipments Prompt Hegseth to Order Immediate Changes

Yahoo

23-05-2025

Defense Secretary Pete Hegseth has ordered immediate changes to address a multitude of problems this year with domestic military permanent change of station moves under the Global Household Goods Contract, or GHC.
In a memo Tuesday to senior leaders and combatant commanders, Hegseth announced that he has ordered U.S. Transportation Command to address what he called "recent deficiencies" in performance by HomeSafe Alliance, the company that manages the $7.2 billion contract to run the department's moving process.
Military families with PCS orders this year have reported numerous issues with scheduling and executing moves, such as packers who don't show up, delayed pickups and deliveries, and cancellations.
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Hegseth outlined six steps Transportation Command will take to better support military personnel and their families when they move.
"Relocating our personnel is critical to the military mission, putting human resources and expertise where they are needed to defend the nation," Hegseth wrote.
According to the memo, Transportation Command must immediately hold HomeSafe Alliance, as well as the legacy system, known as Tender of Service, accountable in meeting performance benchmarks, providing weekly updates to senior Pentagon acquisition and personnel leadership.
The command also must make sure that the GHC is fully operational and, where it falls short, moves should be transferred to the legacy program. The contract, which has been in the works for years, was designed to privatize management of troops' household goods shipments during moves -- and solve widespread dissatisfaction among military families over the handling of the shipments by Transportation Command and the military.
Transportation Command must review the rates it pays to HomeSafe under the contract, and "if appropriate, implement economic price adjustments" to raise the rates, which have been criticized by industry officials as not competitive with market rates.
And, most important to military families who prefer to execute moves themselves, Hegseth increased the rate the Defense Department will pay service members to move themselves -- a "personally procured move" -- to up to 130% of what HomeSafe is currently supposed to receive if the company performed the move.
"As I have determined that the current GHC rates fail to reflect market rates and are in excess of 130% of current GHC rates, implement adjustments to the government constructed costs for reimbursement of personally procured moves from May 15, 2025, through September 30, 2025," Hegseth wrote.
HomeSafe Alliance won the household goods contract in 2021 following a series of protests over the award by other bidders. Under the contract, the entire moving process, from scheduling, packing, pickup and delivery, is supposed to be managed by the private company.
HomeSafe Alliance conducted test moves last year, and this year was supposed to handle the majority of the domestic moves. According to the publication Federal News Network, however, just 25% of domestic moves had been assigned to GHC by April and, of those, 1,600 were turned back over to the legacy system because HomeSafe couldn't handle the capacity.
The DoD oversees roughly 400,000 household goods shipments each year -- 15% of all moves in the U.S.
In a statement to Military.com, HomeSafe Alliance officials said they were grateful for the directive, adding that it will "greatly improve moving experiences for military service members and their families."
"DoD raising our rates to account for significant inflation from the last four years would substantially benefit our ability to facilitate world-class moving services for our nation's heroes," the company said in a statement.
But Dan Hilton, executive director of the American Trucking Associations' Moving and Storage Conference, expressed continued reservations over the contract, which replaced a program that "continues to work well with service members."
"We remain concerned over the GHC contractor's unpreparedness, due to lack of industry engagement in its program, to handle any meaningful volume during this peak season. It's been the experience of our members that the traditional ToS capacity has been unable to adequately plan for peak season due to the GHC contractor's failed implementation," Hilton said in a statement Wednesday.
Megan Harless, an Army veteran and military spouse who has become an advocate for military families undergoing PCS moves, called the memo and the increases for do-it-yourself moves "a step in the right direction."
"It's what we've been asking for since January. This, accountability and transparency," Harless said in a statement on her LinkedIn page.
As part of the order, Hegseth also created a PCS Task Force to review the process and make recommendations for improving, expanding, transferring or terminating the contract or responsibilities of HomeSafe or the legacy system.
In their statement, HomeSafe officials said they "look forward to working" with the task force to show how their program modernizes the move process and "resolves decades-long issues with military relocations."
As part of the ongoing concerns with the PCS process, Transportation Command also relieved Andy Dawson, director of the Defense Personal Property Management Office, this week. He has been temporarily replaced by Army Maj. Gen. Lance Curtis.
Hegseth said that the measures will help ensure that "our warriors and their families receive the best PCS move available."
"The department owes them nothing less, and getting this right is part of restoring their trust in our military," he wrote.
Related: Army Pulls Back Household Goods Shipments as Privatized Moving Contract Leads to Widespread Issues