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At UN, Dodgy Answers on Siemens AG, Whistleblowers, NCE and Gardening Contracts

By Matthew Russell Lee

UNITED NATIONS, July 22 -- Forty days after the Economist rated UN Secretary General Ban Ki-moon a mere two out of ten on management, his Under Secretary General for Management Angela Kane told the Press she didn't know the maximum prohibition which the UN could have imposed on Siemens AG, which pled guilty to corruption. She said didn't know the specifics or public availability of UN gardening contract she'd said had been amended due to the replacement of garden space by the UN's new temporary building. In a school one might say, this is not how grades are improved.

  When Inner City Press first sought to ask Ms. Kane at her July 22 briefing about the controversy surrounding the UN's lesser six month penalty to Siemens AG than the two year ban imposed by the World Bank, "keep it to smoking" was the reply from moderator Marie Okabe of the UN Spokesperson's Office. Video here, from Minute 29:30. Ms. Kane's appearance, the first since May 21 and since the low Economist management rating, was supposed to be about cigarette smoking inside the UN.

   On the Siemens case, the UN Spokesperson's Office, seemingly on behalf of Ms. Kane, had written to Inner City Press on July 11 demanding that corrections of "factual errors" about the Siemens penalties in ICP's original July 7 story be published. But on July 22, Ms. Kane was unable to identify any errors.

    Inner City Press asked if the UN and World Bank applied different standards to the same guilty pleas by Siemens to corruption. It's "not a matter of standards," Ms. Kane said. Since the World Bank has banned Siemens for two years, Inner City Press asked if six months prohibition was the maximum the UN could impose. Ms. Kane, who had demanded correction of errors and even sought to target Inner City Press and two other media organizations for not running corrections, said, "I don't know." Video here, from Minute 36:50.

   In fact, there is no six months maximum for the UN to bar a contractor which has pled guilty to corruption. In the UN Procurement Manual, Section 7.15(1) provides that

"The Director, UN/PD, or CPO as appropriate, shall decide whether to remove, or suspend from the Vendor database and notify the Vendor accordingly. The notice shall advise the Vendor of the United Nation’s decision to suspend for a specific period of time, or remove indefinitely the Vendor from the Vendor database and specify the reasons for the decision."

   So, despite Inner City Press having asked the question at a UN noon briefing before writing, and then having published in full a "correction" by Angela Kane, the question remains: why did the UN impose only a six months ban for the same Siemens facts which triggered a two year prohibition by the World Bank? That the response to this question, rather than an answer or improvement, is to demand corrections of the analysis that the UN does not take corruption seriously enough may be one of the reasons for the UN's and Ban's low grades.

UN's Ban swears in Ms. Kane, Siemens and gardens, walls and doors not shown

  The UN's National Competitive Exam, a merit-based way to enter UN employment, was recently suspended. Member states and others complained, Inner City Press asked and wrote about it. On July 22, Ms. Kane gave another lengthy answer -- video here, from Minute 43:18 -- but still the question has not been answered: if the NCE needed improvement, why not fix it while continuing this one meritocratic entry point?

  In the interest of transparency, Inner City Press is putting online here an internal UN e-mail on this topic, setting out a calendar for the NCE and the G to P promotion exam, also suspended, both purportedly to be resumed in 2010, provided by a whistleblower.

    Ms. Kane was asked about whistleblowers, and replied that she was not aware of any complaints. Video here, from Minute 43:18. Inner City Press asked about the sample case of a UN Development Program whistleblower, whom UN Ethics Officer Robert Benson recommended be paid back wages for due process violations. Has the UN followed up, since the continuing non-payment sends the message that even those whistleblowers who persevere and obtain a recommendation of back wages in fact receive nothing? Ms. Kane said this is outside of her remit, to ask UNDP or Mr. Benson. But neither has taken questions in the UN briefing room for many months.

   Ms. Kane was not asked about her role in the current plan to move UN correspondents from offices with doors and walls which whisteblowers can visit and call to open offices with no doors, the so-called "No Whistleblower Zone" which along with Kane's targeting of three media organizations gave rise to a Dear Colleague letter in the U.S. Congress. Ms. Kane's complaint ostensibly was that the media organization don't run her "corrections" (see above). Who is making the UN look bad?

    While Ms. Kane demanded a correction about the UN's contract for gardening on the North Lawn, now largely occupied by a new temporary building, when Inner City Press asked Ms. Kane how much the contact was reduced by, she said, "I don't that number." Is it in the UN Procurement database? "I don't scroll the data base," Ms. Kane said.

   This is the type of defensiveness and lack of transparency for which this UN is becoming known. Or is that analysis a "factual inaccuracy" for which correction will be demanded?

* * *

Siemens AG Banned Only 6 Months by UN, 2 Years by World Bank, UN Pays For Non-Existent Garden

Byline: Matthew Russell Lee of Inner City Press at the UN: News Analysis

UNITED NATIONS, July 7, updated with UN response July 11 -- As German conglomerate Siemens AG, fresh from guilty pleas under the Foreign Corrupt Practices Act, faces a two year suspension as a vendor by the World Bank, the United Nations has imposed only a six month ban.

   On July 7, Inner City Press asked Secretary General Ban Ki-moon's spokesperson Michele Montas, who has previously defended the UN's failure to ban the Indian Enron Satyam, to explain the different penalties imposed by the UN and the World Bank. "Each body has its own decision making process," Ms. Montas answered. Video here, from Minute 18:25.

   Inner City Press then asked if it would be fair to conclude that the UN or at least its Department of Management which oversees procurement takes anti-corruption even less seriously than the World Bank, based on its ban being one-quarter of the World Bank's, based on the same facts. "It's not a question of which organization is more stringent than the other," Ms. Montas argued. But isn't it?

   Previously, even though the World Bank had barred Satyam from contracting, the UN continued to do business with it. After this was raised by the Press, the UN said it was winding down contracting with Satyam. No updates have been given.

Siemens AG behind thorns -- of non-existent UN garden?

  In June there was no press conference by the chief of the Department of Management, Angela Kane, who has complained that UN responses are not published. For this story, Inner City Press waited hours after asking the question at the UN's noon briefing. The Siemens question is one which should be answered.

    At a smaller level, Inner City Press has been informed that while the UN's North Lawn is now covered by the temporary building which will house the General Assembly and Secretary General's Office during the five years of the Capital Master Plan, payments continue to be made on a multi-year contract for gardening of the North Lawn. This was reported to Inner City Press by a whistleblower, and then confirmed by a UN procurement official. But what is being done?

   The Department of Management, which oversees both procurement and the Capital Master Plan, is continuing despite criticism even in the U.S. Congress with a plan to change reporters' current working conditions, with closed door offices to meet and speak with sources including whistleblowers, to an "open office" plan in which there will be no doors, no walls to the ceiling, no privacy. A whistleblower free zone appears to be what the UN Department of Management has in mind. Watch this site.

From the UN's July 7, 2009 transcript:

Inner City Press: about Siemens, this German conglomerate has been barred by the World Bank from doing business with it for two years for violations of the Foreign Corrupt Practice Act. So now the UN is only barring them for only six months, and I am wondering if the Department of Management or Procurement or the Senior Review Panel -– what’s the difference in terms of the acts? Why would the UN… [interrupted]?

Spokesperson Montas: Each body has its own decision making process, you know. Here, it is for six months and for longer over there. You know, it’s a matter of the individual administrations to decide.

Inner City Press:  is it fair to say that from this one could say the World Bank is more serious about anti-corruption than the UN?  [interrupted]?

Spokesperson Montas: That has nothing to do with this. This is just an administrative matter. They have been banned for six months. So it’s not a question of which organization is more stringent than the other. I don’t think this is the issue. I think the issue is that each one of these organizations has taken measures about Siemens. Thank you all so very much.

Update of July 11, 10:55 a.m. -- The following has been received through the Office of the Spokesperson for the Secretary General, four days after the response quoted above:

Subj: Correction to an Article from Inner City Press

From: unspokesperson-donotreply [at]

To: Inner City Press

Sent: 7/11/2009 8:48:59 A.M. Eastern Standard Time

The article in Inner City Press dated 7 July and titled: Siemens AG Banned Only 6 Months by UN, 2 Years by World bank, UN pays for Non-Existent Garden, is factually wrong. The following corrections should be published.

1. The rules & regulations which govern the vendor management and debarment are different for the UN Secretariat and the World Bank. The UN secretariat is governed by the Procurement Manual chapter 7. The document is on line on the Procurement Division web site, here.

The rules & regulations for the World bank can be consulted on their web site, here.

Suspension by the UN Secretariat was for a period of not less than 6 months. The UN Secretariat reserves the right to continue the suspension until the vendor meets the necessary criteria for re-registration.

2. The UN Secretariat has no contractual relationship with Satyam.

3. The current contract for the maintenance service for the lawn, pruning and hedge trimming of the North Lawn* area has been amended in May 2009 and took into consideration the impact of the CMP project and related constructions. As there are still parts of the UN campus gardens not affected by CMP, there is still a need for gardening services.

   While we will be reporting again on these issues, we note particularly in light of the May 8 meeting led by Under Secretary General for Management Angela Kane which concerned legal threats to three media organizations including Inner City Press for purportedly not publishing UN responses that this response, provided four days after the questions were asked, is being published less then four hours after it was sent, on a Saturday morning.

   Since the difference been the World Bank's two year suspension and the UN's six months suspension of Siemens AG was reported in, among others, Bloomberg News, one wonders if the UN has submitted such a "correction" to Bloomberg News, and if so if they would publish it.

   The German news agency Deutsche Presse-Agentur had a different lead to the story about Munich-based Siemens: "Making up for its past misdeeds, Siemens is to help pay for anti-corruption campaigns by the United Nations." Nationality seems play a role in how this story, and Siemens, are viewed...

  DPA concluded on an up note for Siemens: "In Munich, sources said the opt-out would not necessarily reduce Siemens sales radically, as the group could still sell equipment to projects as a subcontractor." We will have more on this.

  The Department of Management submitted its on the record written response about Siemens four days after Inner City Press asked the question at the UN's noon briefing on July 7. At the July 9 noon briefing, another of the Under Secretary General for Management's decisions was asked about, as a follow up to questions the Spokesperson was taking about the management of UN facilities:

Inner City Press: follow up to that, which is that this issue that’s arisen about the swing space for four or five years, not having enclosed office space for journalists, including investigative journalists, some here have raised that it will make it more difficult to actually, for example, for whistle blowing staff members or others to be able to approach press members with, you know--

Spokesperson Montas: Well, they can approach you at other places besides your own office, can’t they?

Inner City Press: I guess the question is what’s the rationale behind the--

Spokesperson: As I said, this has already been explained in different meetings with you. This is an internal subject which can be discussed very openly with the Capital Master Plan people. I am inviting you to do so, but not during a briefing that is for international issues.

Question: My only question is since it affects, it’s a decision by the Secretariat that affects the way the press can actually cover the UN, I view it as other than housekeeping issue. [inaudible]

Spokesperson: May I suggest that we discuss this elsewhere?

Inner City Press: Okay.

Question: Anything set for the Secretary-General’s monthly briefing?

Spokesperson: We’re trying to negotiate something in between trips. But it will most probably be Monday.

   The Under Secretary General for Management, who first commissioned a survey of how to for the first time try to charge money to correspondents at UN Headquarters and then proposed a swing space with no walls or doors -- which some are calling the "whistleblower free zone" -- has not provided the rationale or response to this issue, which as noted has given rise to a Dear Colleague letter circulated to all member of the U.S. House of Representatives.

  Since responses seem to arrive four days after Management related questions are asked at the UN noon briefing, perhaps the USG's on the record answer on this is to be expected on Monday, July 13, when S-G Ban will substitute a stand up stakeout for the promised sit down month press conference, and the stakeout is timed such that no UN noon briefing will be held. We'll see.

  Click here for an Inner City Press YouTube channel video, mostly UN Headquarters footage, about civilian deaths in Sri Lanka.

Click here for Inner City Press' March 27 UN debate

Click here for Inner City Press March 12 UN (and AIG bailout) debate

Click here for Inner City Press' Feb 26 UN debate

Click here for Feb. 12 debate on Sri Lanka

Click here for Inner City Press' Jan. 16, 2009 debate about Gaza

Click here for Inner City Press' review-of-2008 UN Top Ten debate

Click here for Inner City Press' December 24 debate on UN budget, Niger

Click here from Inner City Press' December 12 debate on UN double standards

Click here for Inner City Press' November 25 debate on Somalia, politics

and this October 17 debate, on Security Council and Obama and the UN.

* * *

These reports are usually also available through Google News and on Lexis-Nexis.

Click here for a Reuters AlertNet piece by this correspondent about Uganda's Lord's Resistance Army. Click here for an earlier Reuters AlertNet piece about the Somali National Reconciliation Congress, and the UN's $200,000 contribution from an undefined trust fund.  Video Analysis here

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