Billions wasted in Iraq, says US audit

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Sun, 30 Apr 2006 21:53:48 -0700

[Zepps_News] Billions wasted in Iraq, says US audit

 

 

 

 

http://www.guardian.co.uk/Iraq/Story/0,,1765048,00.html

 

*Billions wasted in Iraq, says US audit*

 

*· *Projects behind schedule despite massive outlay

*· *Roadside bomb kills 3 contractors, wounds 2

 

*Ewen MacAskill in Washington

Monday May 1, 2006

The Guardian <http://www.guardian.co.uk>*

 

A US congressional inspection team set up to monitor reconstruction in

Iraq today publishes a scathing report of failures by contractors,

mainly from the US, to carry out projects worth hundreds of millions of

dollars.

 

In one case, the inspection team found that three years after the

invasion only six of 150 health centres proposed for Iraq had been

completed by a US contractor, in spite of 75% of the $186m (£100m)

allocated having been spent.

 

The report says: " Fourteen more will be completed by the contractor, and

the remaining facilities, which are partially constructed, will have to

be completed by other means. " The inspectors blame the failure in this

instance on management problems and security concerns.

 

The danger facing foreigners in Iraq was highlighted yesterday when a

roadside bomb 30 miles south of Baghdad killed three private security

firm staff and wounded two others. One of the wounded is British, the

Foreign Office said.

 

The detailed and lengthy report on work projects in Iraq has been drawn

up by Stuart Bowen, the special inspector general for Iraq

reconstruction (Sigir). Mr Bowen's office was set up after Congress

expressed concern about the slow rate of reconstruction and the misuse

of funds on a massive scale.

 

The report says Mr Bowen's inspection team is investigating 72 cases of

alleged fraud and corruption, and is pursuing leads not only in the US

but in Europe and the Middle East.

 

In March, investigators conducted a successful sting operation which led

to the arrest of a contractor who offered a bribe to one of its

undercover agents.

 

The report says many completed projects " have delivered positive

results, but there exists a gap between US project outputs and the

delivery of essential services to Iraqis " .

 

While progress has been made in the construction of schools and police

stations, many Iraqis still have no access to clean water, and

electricity supplies in Baghdad are still below pre-invasion levels. The

inspectors say that economic recovery is being hampered by the failure

to restore Iraq's oil production to levels before 2003.

 

The report says that corruption in the oil and gas sector is a

continuing problem that could have " devastating effects " on

reconstruction in Iraq.

 

The inspectors audited Task Force Shield, a project established in

September 2003 to build Iraq's capacity to protect its oil, gas and

electrical infrastructure, and found significant shortcomings. The

report concludes the project " failed to meet its goals because it was

burdened by a lack of clear management structure and poor

accountability. There were also indications of potential fraud, which

are now under review by Sigir investigators. "

 

Up to last month, Washington had invested more than $265m to improve the

protection of energy infrastructure in Iraq.

 

Task Force Shield sought to cover 340 key installations, 4,000 miles of

oil pipeline, and 8,000 miles of electrical transmission lines.

 

In a separate section, the report notes that a former contractor and

former senior staffer in the now defunct US-led coalition government are

facing jail sentences 30 to 40 years on corruption charges.The

contractor will have to pay $3.6m in restitution and forfeit $3.6m in

assets.

 

Apart from mismanagement and corruption, the report identifies

continuing attacks by Iraqi insurgents as one of the main reasons for

the delays and failures. It says: " Insurgent activity continues to

impede ongoing reconstruction projects and interrupt their transition to

Iraqi control.

 

" But the attacks remain concentrated in a few areas, leaving daily life

in much of the rest of Iraq - particularly the Kurdish north and some

areas of the south - in a state of gradual recovery. "

 

The report adds: " Corruption is another form of insurgency. This second

insurgency can be defeated only through the development of democratic

values and systems, especially the evolution of effective

anti-corruption institutions. "

 

Iraq's president, Jalal Talabani, said yesterday that he and US

officials had met with insurgents and that a deal with some groups to

end violence could be reached.

 

In a statement, Mr Talabani said: " I believe that a deal could be

reached with seven armed groups that visited me. "

 

*Unfinished business*

 

Congress has approved $21bn for reconstruction since the invasion, of

which 67% has been allocated. Precisely how much has been squandered is

not known but the congressional team has been carrying out

investigations and publishes quarterly reports. In the latest, it

highlights the case of a US company which was given a contract to build

150 health centres in Iraq. Only six have been built, all in Baghdad, in

spite of 75% of its allocated $186m having been spent. The report says

the contractor will only complete a further 14. Last year the

congressional team reported that almost $9bn in Iraqi oil revenues

disbursed to ministries had gone missing.

 

 

 

 

 

--

" Now, by the way, any time you hear the United States government talking

about wiretap, it requires -- a wiretap requires a court order.

Nothing has

changed, by the way. When we're talking about chasing down terrorists,

we're

talking about getting a court order before we do so "

-George W. Bush, April 20, 2004

 

 

Pay your taxes so the rich don't have to.

 

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