Panel finds lax oversight of wartime contracting
By RICHARD LARDNER
The Associated Press
Monday, June 8, 2009 6:18 AM
WASHINGTON -- The Defense Department has failed to provide adequate oversight over tens of billions of dollars in contracts to support military operations in Iraq and Afghanistan, says a new report by an independent commission investigating waste and fraud in wartime spending.
In its first report to Congress, the Wartime Contracting Commission presents a bleak assessment of how taxpayer dollars have been spent since 2001. The 111-page report, obtained by The Associated Press, documents poor management, weak oversight, and a failure to learn from past mistakes as recurring themes in wartime contracting.
The commission's report is scheduled to be made public Wednesday at a hearing held by the House Oversight and Government Reform's national security subcommittee.
One example of wasted money cited by the commission involves construction of a $30 million dining facility at a
The commission, established by Congress last year, says more than 240,000 private sector employees are supporting military operations in
At Rustamiyah, a seven-acre forward operating base turned over to the Iraqis in March, the military population plunged from 1,490 to 62 in just three months. During the same period, the contractor population dropped from 928 to 338, leaving more than five contractors for every service member.
In Afghanistan, where President Barack Obama has ordered a large increase of U.S. troops, existing bases will have to expand and new ones will be built - without proper oversight unless the Pentagon rapidly changes course.
Defense Secretary Robert Gates wants to reduce the military's reliance on contractors and hire more government employees and acquisition staff. These steps will begin a badly needed overhaul of the military's approach to contract management, the commission says.
One commander in
There are questionable construction projects in
"The Army should not have accepted a building in such condition," the report says.
The commission cites concerns with a massive support contract known as "LOGCAP" that provides troops with essential services, including housing, meals, mail delivery and laundry.
Despite the huge size and importance of the contract, the main program office managing the work for both
KBR Inc., the primary LOGCAP contractor in Iraq, has been paid nearly $32 billion since 2001. The commission says billions of dollars of that amount ended up wasted due to poorly defined work orders, inadequate oversight and contractor inefficiencies.
In one example, defense auditors challenged KBR after it billed the government for $100 million in costs for private security even though the contract prohibited the use of for-hire guards.
KBR has defended its performance and criticized the commission for making "biased" statements against the company.
"As we look back on what we've done, we're real proud of being able to go into a war theater like that as a private contractor and support 200,000 troops," William P. Utt, chairman of the Houston-based KBR, said in May in an interview with AP reporters and editors.
KBR is also linked to the dining hall construction snafu, although the commission faults the military's planning and not the contractor. With American forces scheduled to leave
In July 2008, the Army said a new dining facility was badly needed at the
KBR was awarded a contract in September. Work began in late October as American and Iraqi officials negotiated the agreement setting the dates for the
But during an April visit to
The decision to push ahead with the new hall was based on paperwork that was never updated and a failure to review the need for the project after the security agreement was signed. Most of the materials have been ordered and construction is well under way. That means canceling the project would save little money because KBR would have a legitimate claim for payment based on the investment it has already made.
On the Net:
Wartime Contracting Commission:http://www.wartimecontracting.gov/
© 2009 The Associated Press
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