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On UN's No-Bid Lockheed Contract, Russia Demands Investigation, Why Council Misled

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

UNITED NATIONS, November 20 -- With questions still unanswered about the UN's no-bid $250 million contract with Lockheed Martin for infrastructure in Darfur, on Tuesday the Russian Federation asked for an investigation of the contract, and noted that neither it nor other Security Council members were told about Lockheed arrangement, which dates to April 2007, before the Council approved by Darfur hybrid peacekeeping force on July 31, 2007. The sole-source contract's first promoter, Assistant Secretary General Jane  Holl Lute, declined to substantively answer questions posed by Inner City Press at a public forum on UN accountability, where Rajat Saha, the outgoing chairman of the UN's Advisory Committee on Administrative and Budgetary Questions speaking in his personal capacity, chided Ms. Holl Lute for lack of planning and spoke of a growing "mistrust between the Secretary-General and the member states." For the second day in a row, series of questions were posed by member states in a formal session of the UN General Assembly's budget committee, with answers requested in a public, formal session. But despite a commitment by the UN spokesperson to provide basis information such as how much money has been paid to Lockheed Martin since the contract's announcement on October 15, the subsequently answer had no dollar figure, and none of the terms of the contract.

            As luck or irony would have it, at least two officials involved in the no-bid contract were on Tuesday morning speaking at a UN University public forum about accountability, held at the New York offices of the African Union. Secretary General for Management Alicia Barcena began the proceedings with a 24-minute speech mentioned the need for ethics training in procurement. Inner City Press has previously asked Ms. Barcena questions about the Lockheed contract, answers to which she left to Warren Sach, currently UN Controller and reportedly soon to be shifted to Assistant Secretary General for procurement, with Japan touted to take over the Controller spot.

            On the panel that followed, Jane Holl Lute derided those who say that transparency means letting everyone know everything all the time. That's "gossip... which is also prevalent" at the UN, she said. Inner City Press asked about the no-bid contract with Lockheed Martin, and about member states' criticism of the process Monday in the Fifth Committee. "I wasn't in the Fifth Committee yesterday," Ms. Holl Lute responded, adding that this was not the right forum to discuss a particular contract, but that all rules were followed.  The outgoing chairman of the UN's Advisory Committee on Administrative and Budgetary Questions Rajat Saha, sitting next to Jane Holl Lute, publicly advised her that more planning should have been done, earlier -- that is, that that $250 million contract should have been put out to bid.

Lockheed's got the contract -- and the copters

            Among the questions asked Tuesday in the GA's budget committee, by the UN's own write-up, were

"Was the company awarded the contract the only one capable of fulfilling all aspects of the contract?  Was there no other company?  It appeared that there was at least one other competitor in the field that could do the same work.  There were also several smaller companies currently providing services to AMIS.  Could the contract not have been split up and put through competitive bidding?  Given that approval for the contract had been given on 25 April, what was the point of having a Headquarters Committee on Contracts review?  Why had the Headquarters Committee on Contracts been made to rush through a decision by 31 August, despite not having sufficient information?"

            After these questions, and Russia's request for an investigation of the contract, and criticism of the Security Council members not having been provided with pertinent information about the April request and decision to go sole-source in Darfur prior to the UNAMID vote on July 31, it is reported that

Bock Yeo, the Officer-in-Charge of the Peacekeeping Financing Division, told the Committee that the Secretariat had carefully recorded all the questions that had been raised and was preparing a detailed response in writing to all of them.  The Controller and the head of procurement would be at the next informal meeting of the Committee to address questions relating to the single-source contract.

            Informal meetings, it should be noted, are closed to the press and public. What was that, again, about transparency? In response to Inner City Press' questions at Tuesday noon briefing about the contract, and how much money has been paid out, this word was once again cited. From the transcript:

Question:  It's a $250 million contract.  Was all that money paid at once?  Is it paid in installments?  Mr. Guehenno said... that there's some danger of not actually doing the deployment if the helicopters are not given and a variety of things happen.  In that case, would all of the money still be paid?  And are they in fact already building the camps? 

Spokesperson:  They are already building the camps, yes.

Question:  And how much of the $250 million has been already transferred to them?  Can we find that out?

Spokesperson:  Okay, I don’t have that number, but I can ask DPKO or the Controller's Office to find out for you what has been dispersed so far.

Question:  And do we know if, as Mr. Guehenno, at least, raised the possibility, if a decision is made for whatever reason either to delay or to not deploy, is the UN legally responsible to still pay the full $250 million or is there some...  Can this, at least, provision of the contract be explained?  Whether the UN is on the hook for the full amount or not the full amount?

Spokesperson:  I'll try to get the information for you. (Video here)

            Apparently DPKO and the Controller, when asked, refused to provide the information about how much has been paid, and the terms of the contract. This is what Inner City Press was sent after the noon briefing:

Subj: your question on Sudan at briefing 
From: unspokesperson-donotreply [at]
To: matthew.lee [at]
Date: 11/20/2007 1:47:47 PM Eastern Standard Time

The $250 million is for the Heavy Support Package, which is the current UN phase of operation in Darfur until the establishment of the hybrid operation that has been mandated by the Security Council to take place before.

The $250 million will be tapped as needed in accordance with the logistical requirements on the ground.

As the SG himself said yesterday, "Abut the issue of contracts – this contract has been authorized by me, considering the extraordinary special circumstances where we couldn't find any proper companies able to carry out such projects. That particular company was the only one that was immediately available and that has been doing similar construction there, and there are practical timelines which the United Nations should meet – the deadlines. Therefore, for me, it was necessary to take some extraordinary measures by authorizing that. But I would like to make it again quite clear that I will make it most transparent and accountable in carrying out contract procedures."

            Does that mean that the contract or its terms will, as requested and previously promised, be made public? Does it mean that the now-promised response to the above-quoted Fifth Committee questions will be made public? Watch this site.

* * *

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

  Because a number of Inner City Press' UN sources go out of their way to express commitment to serving the poor, and while it should be unnecessary, Inner City Press is compelled to conclude this installment in a necessarily-ongoing series by saluting the stated goals of the UN agencies and many of their staff. Keep those cards, letters and emails coming, and phone calls too, we apologize for any phone tag, but please continue trying, and keep the information flowing.

Feedback: Editorial [at]

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UN Office: S-453A, UN, NY 10017 USA Tel: 212-963-1439

Reporter's mobile (and weekends): 718-716-3540