United States Defence Secretary Robert Gates wants to make spending cuts worth about $US10 billion at the Pentagon.
Mr Gates has ordered a far reaching review of what he calls a bloated and wasteful bureaucratic machine.
He says administration costs make up 40% of the Defense Department budget and the savings could be transferred to frontline and combat operations.
The BBC reports the current defence budget, not counting the cost of fighting in Iraq and Afghanistan, is $US535 billion. Mr Gates wants $US549 billion for 2011.