DEFENSE MINISTRY RECEIVES A NEW CONTROLLING BODY

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The military industrial commission that started its active work since May of 2006 (after release of a well-known government resolution and approval of the commission’s statute) kept surprising politicians and public by the progressive steps aimed at strengthening the defense industry. The military industrial commission has already managed to approve the state armament program for the period until 2015, and is finishing development of a similar program for the military industrial enterprises. At its meeting last Tuesday the commission discussed other important issues without which development of the military industrial complex and supplies for the army would be very problematic. The military industrial commission discussed problems of establishment of a unified system for placing orders for armament and combat hardware in the framework of the state defense order and also approved a list of critical technologies without which development and creation of new armament models would be impossible. At the meeting of the commission Sergei Ivanov, Defense Minister and Deputy Prime Minister, announced that federal agency for placing of orders for production of armament and combat hardware would be formed in Russia by 2007. According to Ivanov, the new agency will contract armament and combat hardware in the interests of not only the Defense Ministry but also all security agencies of the country. Ivanov stressed that in the framework of work on establishment of the agency it would be necessary to streamline interaction of state customers, to amend the legislative base and to solve the human resources problem.

Earlier, military orders were placed by dozens of organizations that existed in every Armed Forces branch. However, since 2001 their quantity was reduced by two-thirds, the relevant organizations were separated from all Armed Forces branches and subordinated to the Deputy Defense Ministry. The new agency will be formed on the basis of the organizations that are curators of state orders in the Defense Ministry now. In any case, not officers but civil specialists will be the main persons there. Defense Minister Ivanov explains, “The military will be responsible for what should be purchased and specialists of the agency will be responsible for choice of the parties from whom this is purchased.”

The agency will be subordinated to the Defense Ministry. The Defense Ministry already controls many entities including the federal service for military technological cooperation, the federal defense order service, the federal service of technical and expert control and the special construction agency.

This is not a secret that establishment of the new federal agency for placing of defense orders is planned to avoid corruption and to make the military production system transparent. Will officials of the military industrial commission manage to do this?

At present, controlling functions are fulfilled by the federal defense order service (Rosoboronzakaz) and partially by the staff of the Defense Ministry. Former director of Rosoboronzakaz Andrei Belyaninov appointed Director of the Federal Customs Service in May of 2006, even said in the past that his agency fulfilled the same functions as the Auditing Chamber. Thus, the new agency for purchase of armament will somehow duplicate the functions of both the Auditing Chamber and Rosoboronzakaz simultaneously. However, Rosoboronzakaz will not be reduced. It will evidently be tasked to control quality and standardization of the products made for army. The new agency will evidently be based on the currently being formed unified center of armament and combat hardware orders. It is planned to accomplish formation of the center by September 1, 2006. According to officials of the military industrial commission, the unified center will serve as the basis for formation of the new agency. There will evidently be no need for new personnel because specialists of the center will gradually move to the new entity for armament purchase.

Thus, we see that representatives of the Defense Ministry unsatisfied with efficiency of money spending try to create a more reliable system of control over passage of budget money in the defense sector. Will the new system be more efficient than the old one?

Experts remark that there are enough controlling agencies in the country and they sometimes duplicate each other. However, this abundance does not save from corruption. This may be illustrated by the recent case where representatives of the Auditing Chamber with mediation of a Federation Council member have been extorting bribes from a businessman and have been caught “red-handed.”

The state defense order is a much tastier morsel. In 2007, it is planned to spend more than 300 billion roubles on purchase and production of armament alone. This is a very big sum! This is not a secret that struggle for their reception will be serious in the defense business. The only difference is that henceforth these are not military but civil officials who decide to whom money should be paid for military orders. Is it possible that civilians will succeed more than the military?

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