Special Session, Defense

Huguette Labelle, 12th IACC, Plenary transcript, Financial Sector, Human Security

Huguette Labelle:

You know, if we look at the amount of money spent on defence and security around the world it is huge. I certainly know of one country not to be named where 75 percent of all procurement federal budgets is in defence. We have other countries, a country in particular, a poor country, where 35 percent of GDP is spent on defence. This is not petty cash - huge amounts of money, so that transparency, integrity and lack of corruption in this sector is so very important. Not just because it robs the coffers of the government, but because of all the other very difficult consequences of it.

I will briefly and immediately go to an introduction of the panel we have tonight, so that if you still have the courage and the energy, we can have some discussion as well because I know that a number of people in this room have a lot of experience in the field that we are talking about this evening.

One of our speakers Ana Glenda Tager is the Regional Director for Interpeace. Burak Bekdil is a journalist in Turkey. John Githongo, I'm not quite sure what he is, you may have heard John being interviewed many times and you will remember his work in Kenya, he's a Member of Oxford and continues his mission with a vengeance. To my immediate left we have the representative of the Ministry of Defence of Poland, Maciej Wnuk, who is the Anticorruption Director in the Ministry of Defence in that country and of course Mark Pyman who works with Transparency International UK as the project leader for TI's project on preventing corruption in the arms and security sector that is entitled 'Defence Against Corruption' and of course [inaudible] since 2004. Without any further introduction I would like to call on John Githongo to make his presentation, John...

John Githongo:

Thank you. Thank you very much Huguette. I trust everyone can hear me. I'll limit my comments to issues which I trust will provoke debate in this important area and my comments are broadly marked with my own experience and my own subsequent research as an observer of the issues in the area of security sector reform. First of all, as a result of the very nature of this sector, procurement procedures that relate to security and defence [inaudible]...a product of security sector reform because there is a sense in which, especially in transitioning countries that are grappling with the issue of corruption, the security sector is the last refuge of the country. It is the last sector as a result of national security considerations and some of the most opaque procurement procedures that the government may have. It is the last area in that one finds corrupt activity prevalent and sometimes justified by those who are engaging in it. They often give very articulate explanations as to why kickbacks and commissions are required to facilitate procurement in this area. In transitioning countries this has I think one important and very negative effect where you have prevalent corruption in the security sector. Because you are talking about disciplined forces - the police, military or intelligence – corruption at the top seeks out the bottom very quickly and has quite a kickback on morale at the bottom and insecurity is a direct result and affects the poor the most. I think that this is one area where corruption has a very very direct impact on the poor.

I am going to throw up two issues that I believe are of particular importance when dealing with security sector reform and here I am going to use my own experience. As a result of the size of this area and the prevalence of corruption in it, it is kept secret because of national security considerations. I think there are two problems where recommendations or comments about them occur to me:

Of course African defence procurement is comparably smaller, it involves rifles, cartridges, etc. We don't buy F-16s and other big big items that are provided by some of the world's biggest contractors. Across the continent I would say there is a group of no more than about twelve to thirteen key agents of the key defence proprietors on the continent. Whether it's agents who are importing armaments from the former Eastern Europe or from the Far East or from Europe, it is a small number of agents going from country to country selling arms across the continent and one of the reasons this has been a bit of a hobbyhorse of mine is some transparency with regard to the who these agents are will go a long way to fighting corruption in this important area. Who are these agents? We have their names for market spending. If you read the reports of the United Nations on the Congo conflict and the conflicts in West Africa the same names keep on coming up and one realises that across the continent a small group of people are in charge of selling weapons across the continent and perpetuating […]...that has such devastating effects. That's number one.

Number two and I think I will make this really my final comment because it's an issue which I think is the soft underbelly of defence procurement and an area where anticorruption interventions can have a very very major impact. Defence procurement often comes together with the procurement of commercial debt to finance that procurement. Some form of what we are talking about: our friends at the Paris Club, I am talking about the London Club of commercial banks and other financing entities that approach Third World countries with the promise of short-term capital to finance defence procurement. Often it is offshore companies that are created to finance these transactions and one of the really important measures that can be implemented to help with dealing with corruption in this sector in countries is to simply audit the commercial debt and you will find that in there is information that is extremely important regarding sometimes fictitious defence procurement, overpricing, transfer pricing and the payment of kickbacks, especially in offshore centres as compensation.

Defence procurement is the soft underbelly of this whole sector and it is an area in which intervention can be made; hasn't been made in the past in the form of auditing commercial debt to find out the kind of kickbacks that are being made and just the comparisons that are being made between what one country pays for a particular item to another. What Poland pays compared to Kenya or compared to another country. This will yield a lot of surprises and the interest rate variations between these debts but also will yield a lot of surprises. So a lot of this information is in the public domain and perhaps one of the things that we should be doing in a forum like this is pushing the International Monetary Fund, which has access to some of these details on commercial debt, to assist anticorruption and the corruption movement to audit this debt that is used to finance defence procurement across the Third World. I will leave you with that, if you have a few comments and then hand over to the next speaker.

Huguette Labelle:

Thank you John.


I'd now like to call on Burak Bekdil [inaudible].

Burak Bekdil:

Ladies and Gentlemen, I am here to talk about efforts for security sector reform in Turkey and very ingenious barriers to these reform efforts in my country. I guess what Winston Churchill once said about Russia is perfectly applicable to Turkey in the 21st century, "a riddle wrapped in mystery inside an enigma."

A country of:

  • over 70 million people with a per capita income of less than $5,000, yet spending $4 billion for new defence equipment every year and $12 billion for its defences, or 10 percent of its national budget

  • a former empire

  • ninety-nine percent Muslim but genuinely secular

  • located in one of the world’s most difficult locations bordering Iran, Syria and Iraq yet desperately seeking a permanent place in the European Union

  • Washington’s one-time Cold War ally, not any longer I suppose

  • A NATO member, surrounded by presumably hostile states- hostilities dating back to its imperial past

  • a country that maintains NATO’s second biggest army with nearly one million soldiers, a contributor to international peacekeeping and stability missions including Afghanistan, Kosovo, Bosnia, and most recently in Lebanon

  • a military fighting a bloody separatist terror since 1984 that has already left behind over 35,000 dead people

  • a military that has been keeping 35,000 troops in the dividing line in the middle of Cyprus since 1974

  • a military that considers itself as the guardian of the secular regime in the country, a military that has staged three conventional coups since 1960 and a post-modern one as recently as 1997, yet the same military viewed by a majority of the Turks as the country’s most-trusted institution

This is a fairly complicated picture, but we are talking about a country where the government's official security threat paper points to almost all of its neighbours, plus separatists, radical Islam, the ultra-left, the ultra-right as security threats.

Turkey, now a candidate for membership of the European Union, has long been under pressure form Brussels to reform its armed forces so as to minimise the role of its army politics. Under pressure from the EU, Turkey appointed its first civilian secretary general for the National Security Council in 2003, and has removed scores of military officers from that office since then. In the same year, a law stripped the military of its powers to appoint officers to government boards – independent government boards - that oversee higher education and broadcasting. Another legislation in 2004 brought broader judicial scrutiny over military spending, and in 2005 full parliamentary supervision was introduced. The Supreme Court of Accounts audits spending in weapons systems and procurement programs on behalf of parliament. But that’s not sufficient according to the EU.

The latest progress report released by the European Commission last week was highly critical of the failure of reforms on the part of security forces in Turkey. A couple of quotes from the report:

The Turkish Armed Forces are continuing to exercise significant political influence. Several members of the Armed Forces have expressed their opinion on domestic and foreign policy issues including Cyprus, secularism, and the Kurdish issue…”

“No further progress has been achieved in terms of strengthening parliamentary overseeing of the military budget and expenditures. Furthermore, extra-budgetary funds are excluded from parliamentary scrutiny.”

But what reforms are being asked of Turkey? A reform, according to Ambrose Bierce, an 19th century American satirist, is a thing that satisfies reformers who are opposed to reformation. That looks perfectly applicable to Turkey's case vis à vis European demands for further reform. In the real world the talk of security sector reform in Turkey entails two basic objectives: One is the switch into smaller smarter military structures with less soldiers and the second one, and the more difficult and broader one, is keeping the mouths of the generals shut. That is, they should not have any influence over politics or they should not speak on political matters.

But here we are facing a difficult dilemma. For a smaller and better army it is all a matter of financing. According to various estimates Turkey would have to spend $50 billion – five zero - if it is to reduce its army size from 900,000 plus to 250,000 and, at the same time, if it intends to maintain the same level of military deterrents. So it is all a matter of financing which is not available at the moment.

As for the broader objective that the generals should be kept away from politics that too is a very difficult task. One reason is purely legal. The Turkish Constitution gives powers to the Armed Forces to defend the country against foreign and domestic threats. That covers basically everything that the military structure views as a threat. And we have quite a funny situation here because the EU tells Turkey that its generals should not speak on issues like Cyprus, secularism, and the Kurdish dispute, it's all fine, but the trouble is that according to the official threat document not crafted by the generals but signed and approved by the civilian government, all of these issues are security matters, and what is more normal than generals speaking about security matters?

So that is a genuine Turkish paradox.

The current situation in Turkey is even more ironic than that. We have a government that takes its roots from Islamism as a political doctrine, not Islam as faith. Keeping in mind that the Turkish military has this traditional self-declared mission of defending the country's secular regime against anything based on political Islam, it is a difficult cohabitation that we see between the government and the military that goes back to the 2002 elections. So in this case the military, based on the Constitution which authorises it to fight foreign and domestic threats and on the national threat document that says Islamism is a threat, privately views the government to which it is accountable a threat.

That is the core of the paradox we are facing in Turkey. On the one hand we have the civilian, the political authority; on the other hand we have the military to which it is accountable and at the same time privately viewing the political authority as a threat to the country that it must defend.

And there is more to this complex picture. According to various opinion polls, over 80 percent of the Turks cite the military as the most-trusted institution and only less than 20 percent say they trust the government. We might as well recall that 92 percent of the Turks had supported the last conventional coup of 1980. There is empirical evidence that if asked to choose between full-fledged democracy with their military crippled and a strong but sometimes-not-too-democratic military, the Turks would go for the latter.

Well one reason for that: we have been talking about a lack of transparency in military dealings. Apparently what makes the people trust the military more than the politicians is the lack of transparency in the civilian sector. To give you a couple of examples: the tax affairs, the dubious tax affairs, of a company owned by the Finance Minister's son, remain to be classified on the basis of secrecy of tax records. Most recently an opposition MP filed an inquiry in parliament to the Energy Minister simply asking how much money the city of Ankara owed to the state-run pipeline company in natural gas debts. The minister declined to reply, citing commercial secrecy. If there can be commercial secrecy between a government controlled municipality and a government controlled natural gas supplier, why can't there be any secrecy in defence deals which by nature should contain some secrecy clauses, even in first class democracies? That's another paradox.

But what I am trying to show you with these examples is that security sector reform and full civilian control over the military would be difficult tasks in countries where:

a. Democracy has its own bizarre rules, like a government controlling two thirds of parliament on one third of valid votes only, which is the situation in Turkey. The incumbent government in Turkey in the 2002 elections won a third of the valid elections and a quarter of the entire electorate and they won two thirds of the parliamentary seats;

b. There isn’t satisfactory civilian control over the civilian authority in the first place – i.e. a proper civilian control over the government is the prerequisite for a proper civilian control over the military;

c. Corruption in non-military government is endemic;

d. A majority of the people respect and trust the military, and not the government;

and finally,

e. The military command often looks more democratic in challenging evidence of corruption than the civilian authorities are.

Only a couple of months ago, the top EU diplomat in Ankara, Hans-Jörg Kretschmer, in criticism of the military, said that, “[…]in a democracy the ultimate decision rests with the people…it is they who decide which kind of state they want to have, which role the state should play and how much money they wish to pay for security...”

In democracies, civilian control over the military is a sine qua non. But so is civilian control over the government. The fact is that most Turks believe that the most immediate obstacle against better democracy in Turkey is the lack of civilian control over the government, not over the military. That perception, so widespread in the public, only deters security sector reform. If the government is serious about that reform, it should first reform itself and set a precedent so that no general can hide behind the excuse of undemocratic practice in the civilian sector.

Thank you for your attention.

Ana Glenda Tager Rosado:

Buenas noches a todos. Lamento para los que no hablan español pero mi inglés es bastante malo así que prefiero hacerlo en español.

Yo voy a tratar de hacer una relación entre el tema de la transparencia y la reforma del sector de seguridad en el caso de Guatemala.

Inicialmente hay que analizar -en casos como el guatemalteco, pero también en casos como los que mis compañeros acaban de disponer- el hecho de que una buena gobernabilidad requiere de control de la corrupción, del imperio de la ley, de la efectividad del gobierno, de la rendición de cuentas y de la estabilidad política. En este marco se inserta la reforma del sector de seguridad.

La reforma de sector seguridad está enfocada en el uso de los recursos públicos para proveer seguridad a los ciudadanos. Es un enfoque holístico que busca reformar los estructuras del estado responsables de proveer seguridad con énfasis en gobernabilidad, estado de derecho y transparencia.

A nivel de reforma de sector seguridad hay una serie de conceptos y principios que son básicos para poder relacionarnos con el tema de transparencia. La importancia de la normatividad o principios a la hora de hacer una reforma del sector seguridad debe estar enfocada en un estado democrático de derecho. Con una visión sistémica de la seguridad, o sea transformar una de las partes va a tener consecuencias en la otra.

A eso me refiero - que no podemos hablar de la transformación del sector de defensa si no hacemos una transformación del sistema de inteligencia, del sistema judicial o de lo que es la seguridad ciudadana. Tiene que ser un enfoque realmente holístico.

Luego hay que observar no solo el resultado sino también todo el proceso de la reforma. Porque esto es muy importante sobre todo en países que han estado en transición a la democracia. Hay que hacer un análisis más allá de lo estatal también. Requiere un análisis del entorno global, de las transformaciones y de las relaciones de poder.

¿En que contexto será esta reforma?

Las condiciones en que surge la reforma son [inaudible], autonomía militar y gerencia política nacional; policía militarizada y sobre todo una gran debilidad institucional con baja capacidad del estado para responder a las demandas sociales; un sistema democrático de baja intensidad, con derechos políticos y civiles que son vulnerados con frecuencia; una debilidad de los partidos políticos, ausencia de marcos legales, impunidad, falta de información con medios de comunicación muy debilitados; una escasez en el tiempo para el escrutinio adecuado y una falta de conocimiento especializado de la temática y una falta también de personal especializado. En este sentido se enmarca toda la reforma del sector de defensa que debe partir de un cambio de paradigma, un cambio del concepto de seguridad en global.

¿Cual debe ser su prioridad?

El fortalecimiento del control civil democrático, la promoción de la eficiencia de las instituciones de la defensa, la generación de capacidades en el sector y la promoción de iniciativas regionales.

La implementación de políticas debe comprender el contexto y adaptar los enfoques específicos con una mayor coordinación nacional entre las agencias y fortalecer la coherencia de la reforma con las prioridades.

Y aquí voy a pasar ya, para darles un mayor contexto al caso guatemalteco, al problema que ha tenido Guatemala en un doble paso, tanto del autoritarismo a la democracia como del conflicto a la paz. Fueron 36 años de enfrentamiento armado con gobiernos autoritarios.

Y esto hace que sea una reforma que se enmarca en una situación todavía más compleja.

Al inicio de la reforma que fue en 1996 con la firma de los acuerdos de paz se inicia con un gobierno con ausencia de habilidad política, con falta de capacidad técnica tanto conceptual como operativa, una clase política muy debilitada, con desinterés y desinformación, un ejército sin liderazgo para el cambio y muy resistente sobre todo a este cambio. Con una sociedad civil también muy desarticulada, confrontada y con poca capacidad de propuesta.

A pesar de todos estos cambios, de todas estas dificultades, en Guatemala desde 1996 hasta este momento se han hecho una serie de ejercicios [inaudible] tratando de ser un encuentro entre estado y sociedad civil, y gracias a ellos se ha logrado una serie de cambios que han transparentado un poco mas el trabajo desde la institución de la defensa, a pesar de que no ha sido un proceso lineal que no ha tenido cortapisas; ha tenido momentos mas difíciles que otros.

Se ha logrado una reducción numérica de efectivos, se pasó de tener 46 500 efectivos en 1997 a tener 15 500 efectivos en el 2004. Luego una transformación de la fuerza que pasa a ser un despliegue funcional, distinto a lo que tenían durante la época de enfrentamiento armado. Una reorganización de la estructura administrativa de gestión y alianzas con civiles y haciendo comunicación social.

A esto hay que añadir la eficiencia en temas de gasto que como pueden ver Ustedes en la gráfica los acuerdos de paz estipulaban un gasto de un 0,76 % del PIB, y del 1996 a 2000 no se cumplió con dicho compromiso y el presupuesto alcanzó el 7% del PIB.

En el 2004 se inicia un plan de modernización que el gobierno lanza a nivel del ejército. Y allí se estipula que el gasto de defensa debe ser el 0,33 % del PIB, y en el 2005 el presupuesto alcanza un 0,45 % de este PIB. Como podrán ver no se logra lo estipulado con la modernización, pero sí se logra superar lo estipulado en los acuerdo de paz y para nosotros eso ya ha sido un gran paso, un gran avance.

Pero al mismo tiempo les voy a enseñar algo más. Estos son algunos recortes de los periódicos donde podrán ver la foto - los extranjeros, no sé si están familiarizados- con el anterior presidente de la República, el señor Alfonso Portillo. El señor Alfonso Portillo está en México y estamos nosotros haciendo todo un seguimiento legal desde Guatemala porque fue señalado por haber hecho una malversación de fondos durante su gobierno al haber hecho una transferencia desde finanzas públicas hacia el ministerio de la defensa que no estaba estipulada dentro del presupuesto. Fue una cantidad de 120 millones de quetzales de las cuales 30 millones fueron a fondo de un amigo personal del presidente que era entonces presidente de unos de los bancos.

Además se calcula que de unos 906 millones más no se sabe que sucedió y en uno de los recortes podrán ver las fotografías de los seis anteriores ministros de la defensa que aparecen pendientes de ver si va a haber un proceso con ellos o no en el tema de malversación de fondos.

Con esto lo que les quiero señalar es el hecho de que aunque hay ciertos avances en el proceso, es un proceso bastante complejo en el cual sobre todo los temas de corrupción son los mas difíciles de manejar. Y mientras estén dados casos de corrupción va a ser muy complejo de que se logre la reforma en su conjunto.

A nivel de conclusión podríamos decir que es importante

- revisar periódicamente las actividades del ministerio de la defensa por medio de su respectiva política;

- controlar el cumplimiento de leyes del acceso a la información por parte del ministerio y la calidad de información que está suministrando al legislativo;

- examinar las peticiones y reclamos del personal militar y de los civiles con respecto al sector de la seguridad;

- considerar e informar sobre todo proyecto de ley propuesto por el gobierno y remitido a la misma por el congreso;

- considerar los tratados y acuerdos internacionales o regionales que están dentro de los ámbitos de competencia del ministerio;

- examinar e informar sobre los principales presupuestos estimativos y los gastos anuales del ministerio de la defensa;

- considerar cada presupuesto complementario presentado por el ministerio de la defensa e informar al legislativo cuando este tema exija una mayor consideración;

- considerar, y si corresponde recibir pruebas, e informar al legislativo sobre toda designación importante hecha por la autoridad pertinente del poder ejecutivo;

- considerar la organización interna del sector de defensa eventualmente a través de organismos externos relacionados con el congreso e informar al congreso en caso de posible malfuncionamiento.

Después de decir esto también tengo que terminar diciendo que también es importante saber que en el marco de un estado débil este congreso del que queremos que haga controles externos es un congreso muy debilitado con funcionarios pocos capacitados en la temática y eso por lo tanto hace mucho mas compleja la tarea.

Muchas gracias.

Huguette Labelle:

Thank you Ana. […]

Mark Pyman:

Ladies and Gentlemen, good evening.

I am here to speak with you together with Maciej Wnuk, the Director of Anticorruption from the Polish Ministry of National Defence. Just the fact that the two of us are able to speak to you together says something that the climate around defence is changing in some way. I have some slides, can you see them and does this magic thing work? It does.

(Referring to various slides while speaking)

I would love to tell you that this is British Military Headquarters. In fact it is a very symbolic place. It is Arundel Castle in the South of England; it is one where three years ago two or three arms exporting governments, half a dozen arms companies and a number of NGOs met to say “is there really an energy and a possibility for addressing corruption in defence?” Out of that meeting from which the answer from everybody present, slightly to our surprise, was 'yes', TI was asked to play the best role it could as a catalyst because all of the defence community said we are so insular, we don't think we can do it ourselves and two of the governments present were kind enough to fund the TI defence team - being the UK and Sweden.

First of all – what are we doing? The first thing we're doing is trying to build awareness. We don't need to read the small print but simply it is possible to address the subject of corruption in defence. People have been so used for so many years to regard it as completely impossible that simply to be having this conversation with people whether they be NATO, whether they be the World Bank, whether they be defence ministries, whether they be aid organisations, is we think, a starting point for our role. We then are seeking to build collaboration. There are four key groups in this world - the defence companies, the exporting governments, the importing governments and key transnational organisations, of which we think NATO is the most significant and I'll say a word on each of them in a moment.

The second step is to build some practical experience. We have been almost advertising, is there a reformist defence minister out there who is ready to address corruption issues in his defence ministry? Or rather we have not been advertising, the national TI chapters in a number of countries are well engaged with their government and sometimes with their defence ministry. And to our surprise, a surprising number of governments have said, well we're a little nervous but we would really like to address corruption in defence, come and do something with us.

So this is a practical project. We have been dealing with Latvia, Columbia and currently Poland, of which Maciej will speak in a moment. But at the same time a number of other TI chapters, quite independent of this project, have been working with their national defence environment, of which the most significant besides Columbia are South Korea and India. Both have done quite remarkable things which we can talk about in the Questions & Answers.

The whole purpose of this is to reduce corruption in particular national governments but we think it requires the preceding collaboration in order to make that happen. Just a word here, in many countries to talk about corruption in defence is still too difficult, it's still too dangerous. It's still too corrupt and it is very life threatening to have that conversation. Clearly we are not engaging with those governments nor are we advocating that any of us do. But it has been a surprise really how many governments are ready and open to have this discussion.

Just a word before I leave this slide, down at the bottom on the right it says 'monitoring'. Monitoring is really important in several ways. Firstly, just as a way of providing some public information on what progress is being made by defence ministries or by defence companies. Some TI chapters publish an index like the TI national one of how institutions in that country are regarded. In some of those countries the defence environment is regarded very badly, in others quite well. I think Colombia is an example where that kind of survey was a very active stimulus to the Defence Ministry to change. But we also need a different sort of monitoring. My theme here is that addressing corruption in defence is so blindingly obvious and sensible for any kind of efficient government, that it would be nice to have metrics showing how much you are saving year by year by having a more transparent defence environment.

In terms of building collaboration, just a quick word on each of those three blocks:

  1. With the companies, we have engaged, I think, all the major European and US companies now and in July of this year they announced the formation of an official task force and forum in which they discuss and address and strengthen anticorruption, antibribery practices in their companies. It is very early stages. We can be cynical whether it is serious or a public relations exercise. We think it is quite serious and certainly they think that it is quite remarkable that they have come together and are rather surprised at themselves.

  2. With the exporting governments, these people are crucial because this is not a private sector business. No defence company will move an inch unless their government top procurement person tells them they can. So far we've engaged with six or seven, they are telling us they support this and indeed two of them have already jointly sponsored workshops with all of their national defence companies where we and the Defence Ministry go through all of this with them.

  3. Thirdly NATO. Just as the World Bank is to development NATO is to the military in a large number of countries of the world. To our advantage NATO has recently adopted a strategy of engaging with NGOs and at the very minimum they are looking for some NGOs to engage with, but more seriously, they are clearly interested in defence, in anticorruption, and we have been actively engaged with them for a year now on seeking to find stronger ways of introducing anticorruption practices, particularly with the 26 NATO partner countries.

It is fantastic. I mean this is one of those happy slides. You know, good things are happening in each of these three areas but these are very delicate shoots. I think for all the strength and military firepower, there is a lot of hesitancy about this process and it could very easily stop if some adverse event were to happen.

Just very briefly now. There is no such thing as a standard defence ministry. They range from the very sophisticated like the US, all the way around to conflict states and failed states with half a dozen variations in between. The corruption issues vary as you go from one to the other. In the sophisticated states, if some of you were in the procurement reform session of yesterday, think framework contracts, think high percentages single sourcing, think rotating revolving doors with military and contractors. There is plenty of machinery there to tackle and then you come around through overly strong militaries, poor procurement practices, all the way around to where you have military force intervening in a country who is typically extremely poorly informed on corruption and how to address it.

The one thing that almost all of these types of defence ministries have in common is that procurement is their number one issue. There are some other issues and they are on the slide but I don't propose in the time to talk about them, other than to say someone on Wednesday said, "follow the money, well its procurement and its pay and its property are three pretty good places to start."

But on procurement, that's the green box up on the top left there, there are a string of things that you can do both as ordinary reforms and in using civil society. You can have civil oversight of the major tenders. That is what South Korea is doing at the moment, that is what we were doing with TI Colombia and that is what Maciej Wnuk is engaging or beginning to engage in with Poland. You can have independent reviews of their procurement practices. The Colombian Defence Minister was ready to open all of his books on his last twenty two military procurements to us, allow us to interview successful bidders, allow us to interview failed bidders and use that as feedback to them on how open or otherwise his Defence Ministry was.

The two critical things in order to make any of that possible: Firstly you actually need some quite serious technical expertise - both military and procurement - otherwise you don't have the credibility to get through the door. That's possible and in many cases defence ministries are entirely open to foreign independent experts because most of them believe within their own country there is no such thing as an independent military technical expert. They have all been bought or used or paid by someone. The second thing is to build relationships. Defence ministry people have been used to having a very closed world for a very long time and it is a very unexpected experience to deal with outsiders. So building those relationships is one of the core success factors of having any chance to make an impact.

I am going to pass over to Maciej Wnuk but just before I do so there is another box up there called political will or political leadership. If you have a good defence minister there are a whole string of ways in which you can demonstrate political will and build that political will. Most armed forces hate being corrupt. If you are visibly trying to do something about it in terms of promotion, in terms of procurement integrity, lots of ways you build a lot of support. If you show the electorate you are spending its money for a more efficient outcome or you are stopping some obviously corrupt promotions, you build support. With your cabinet colleagues and don't laugh at me when I say this but in at least a few cases they quite clearly believe that anticorruption reform is easier in a defence ministry than elsewhere in the government. You have more autonomy, you have more discipline through a military hierarchy, and in a curious way you have more freedom with procurement rules because you are almost always allowed an exemption from the standard ones. So you can use that positively if you are so inclined.

Let me now hand over to Maciej, who will now talk about the experience in Poland.


Maciej Wnuk:

Ladies and Gentlemen, let me present recent experience in Poland. According to the Corruption Perceptions Index, Poland is the most corrupt country in the European Union. Consequently counteracting corruption was one of the priorities of the presidential and parliamentary election campaigns in the year 2005. The defence sector was (and is) one of the areas with high corruption risk. You can see examples of this on the slide. In the defence sector several institutions had corruption roles including those of the Military Police, Military Public Prosecutor, Military Intelligence Service, Control Department, Audit Office, and Legal Department. However, their activities were absolutely uncoordinated. For instance, the report on the risk of corruption drawn up at the beginning of 2005 was laid aside and did not result in any actions. This meant there was no anti-corruption policy in the Ministry.

During the last year, at the state level, anti-corruption related activities focused primarily on more effective detection of criminal activity and subsequent punishment. The Central Anticorruption Bureau was established as a new special secret service. Operating principles of the public prosecutors’ bodies were changed by appointing high-level special teams to carry out investigations into major fraud plots and organised crime. The Military Intelligence Service, accused inter alia of participation in fraud scandals, was disbanded. Its officers were vetted before being employed in the new intelligence and counter-intelligence services.

Radosław Sikorski was appointed as the Minister of National Defence one year ago. He declared to his partners:

“We want to be the leader in implementing anti-corruption solutions, to set an example for other bodies of the administration. We should not only rely on more effective criminal investigation, but also pay particular attention to procedural changes that have the objective of preventing corruption.”

One of the Minister’s first decisions was to appoint the Director for Anticorruption Procedures. The main aim of the Director was to establish an anticorruption policy in the Ministry and to supervise its implementation.

We improved procedures to ensure that there were no conflicts of interest amongst members of tender commissions. Declarations on conflicts of interest have been enhanced to include a wider range of family members and involvement with all contracts with tender participants.

We pressed for competitive methods in buying military equipment, in order to limit single-source procedures. We tried to press for this at the earliest stage possible, ideally during the determination of the operational requirements for new military equipment.

We simplified access to information on future and current procurements. This is published in one place, on the Ministry website. Consequently, companies can now protest against single-source procurement if they feel they have been excluded from a competition.

Minister Sikorski stimulated activities of the military police and prosecutors. During the first meeting with the commander of military police, the Minister declared that “there are no sacred cows”. At his request, the Minister of Justice replaced the main military public prosecutor, whose approach was too defensive. As a result, the first military general was charged in a corruption case.

We have started to introduce elements of Transparency International’s ‘Defence Integrity Pacts’ into the tender for VIP aircraft and we hope to also apply them to a significant tender for transport helicopters. Finally, the use of electronic auctions has increased and we plan further development of e-procurements.

Changes introduced are often slowed down by inertia or resistance of the administration. Reasons for this differ. Some people think that these are only empty statements. Others seek to protect their interests or profits. Some people are just not able to act in a different way.

Additionally, overnight reorganisation of the army and the Ministry of Defence would be difficult – an ineffective ministry is better than a completely paralysed one. Minister Sikorski accepted a strategy of gradual but consistent change. At the end of the first year, this strategy generated results: indications of co-operation are now more frequent than signs of rejection of the new policy.

Employment of private sector experts with wide experience has been initiated. These people are able to introduce major changes by introducing good practices from the private sector. Lack of previous relationships with ministry employees enables or with defence sector generals enhances their effectiveness.

Several sources of analysis are used. This prevents hiding problems under the carpet and forces comprehensive discussion.

However, I think the most important principle is basing reforms on procedures, rather than on personnel changes only. It makes the adjustments reliable internally and externally. Personnel changes are inevitable, but focusing on procedures clearly indicates that the requirement is to introduce genuine change rather than merely to replace the old corrupt regime with a new corrupt one.

Thank you very much.

Huguette Labelle:

Thank you to all of you. Do you still have enough energy left for a few questions or not? You do? Okay – we will use this microphone because this is the only one that is linked to the simultaneous interpretation. Please come forward and I'll go down.

Question 1/comment from the floor:

Hello, thank you for the presentations. My name is Alejandro Bendaña, from an NGO from Nicaragua. Haven't we got a bit of an ethical problem here? We can speak of democratic control over the military, fine, but if we are talking about enhancing the effectiveness, efficiency and public presentability of the military- it might be a different issue. NATO is not exactly a humanitarian organisation. The Columbian military has one of the worst human rights records in the world. The Kurds might have something to say about the Turkish military too, so how do you grapple with that? Has that gone through some kind of consideration from a TI perspective? Thank you.

Huguette Labelle:

Thank you. Let us take a few more questions before asking the panel to comment. Yes please, come over.

Question 2/comment from the floor:

(Marie-Luise Ahlendorf, TI) We have seen in the past and probably in the future an increasing involvement of the military in humanitarian relief, like distributing aid in emergency relief and humanitarian assistance and then in the reconstruction process. I would like to know in how far you see that will be an increasing problem in the future in terms of the distortion of aid and what we can do to prevent and what role TI could play?

Huguette Labelle :

Thank you Marie Luise. Maybe two more and then we'll turn to the panel.

Question 3/comment from the floor:

Victoria Jennett, from Transparency International Secretariat in Berlin. My first question follows on from my colleague Marie-Luise and I'm wondering about the implications of the changing role of the military from fighting missions to peacekeeping missions and whether that has implications for defence procurement. In particular I am thinking of UN peacekeeping missions in Africa where many nationals, for instance the South African National Defence Force who is operative in the MONUC peacekeeping mission in the Democratic Republic docSpecial Session, Defense

Brazil 2012

Brazil 2012

IACC Video

IACC Video