The Pentagon's decision to minimize the sequester's budget impact during the 2013 fiscal year could cost the Defense Department money in the long run, according to a Government Accountability Office report.
Under sequestration the Defense Department had its discretionary-spending budget cut by $37 billion--from about $527 billion to $490 billion--during the last fiscal year. But, with congressional approval, it acted to lessen the impact, including moving money between accounts. By doing so, DOD "was able to protect or minimize disruptions in certain key areas," according to the report.
But the Defense Department will likely feel the full impact of sequestration during the current fiscal year, and some officials told GAO that the department's decisions in the 2013 fiscal year could result in increased costs over the next few years.