Cablegate: Chalabi's Provision of Services Committee - January 17 &

DE RUEHGB #0162/01 0221515
P 221515Z JAN 08




E.O. 12958: N/A
SUBJECT: Chalabi's Provision of Services Committee - January 17 &
January 20

1. SUMMARY: The Provision of Services Committee met for the first
time in slightly more than a month on Tuesday, January 15. The
Ministries of Oil, Trade, Health, Education and Defense attended.
The National Security Advisor was represented as was the Joint
Planning Commission, Iraqi Ground Forces, the Amanat, FAQ (Baghdad
Security Plan) spokesperson, MNF-I, MNC-I and the US Embassy. Topics
included oil, highlighting kerosene and jet fuel shortages;
inadequate schools; health; and significant service shortages in
Ghazaliya. A special session was called on January 20 to address
pharmaceutical procurement. END SUMMARY.

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Not Unlike Previous Meetings: Ministries Detail Issues
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2. The Ministry of Oil (MoO) suggested that "some" entity be
responsible for monitoring crude shipments to factories. It was
previously reported that factories are selling the crude rather than
using it to operate their facilities because it is more profitable.
A committee member suggested that the local council be responsible
for this issue, but no final decision was made. MoO reported that
fuel had been provided to Sabi' Al Bor, a suburb of Baghdad, also a
previous committee recommendation. The representative also asked
MNF-I why repair to the 14" pipeline to Doura was postponed on
January 15. MNF-I responded that the work will commence on January
24, but wasn't certain of the cause for delay. Finally, the MoO
warned of continued jet fuel and kerosene shortages due to
unreliable electricity at refineries. The MoO suggested purchasing
generators to operate refineries when necessary. Fuel for the
generators would still need to be supplied.

3. Representatives from the Ministry of Health (MoH) claimed that
there was a nation-wide shortage of medical equipment like CT scans
and MRIs. They also complained that there has been no resolution to
the ongoing shortage of life saving medications. This procurement
delay was attributed to Khamidiya, the MoH's internal procurement
process, and the rules and regulations more generally governing
prescription drug procurement. Chalabi called a special health
session to be held on Sunday, January 20 to address this issue. The
committee agreed. The MoH announced that the transfer of the Al
Karkh Hospital was complete and it will open this week for military

4. Dr. Chalabi again rattled out numbers of schools needed
nation-wide. He said that Baghdad alone needs 1,000 more. Previously
land rights were an issue, but according to several committee
members the Amanat, the Provincial Council and the Ministry of
Education (MoEd) has come to an agreement. Chalabi requested a
report on the schools throughout Baghdad, highlighting which schools
need to be rehabilitated and where new schools can be built. ITAO
Director Tokola reminded the committee that Prime Minister Maliki
had suggested renting space for schools if construction would take
long. The committee did not favor the idea of renting, but another
member suggested the use of trailers.

5. The committee reviewed decisions taken to alleviate the potable
water shortage in Nahrawan, including the use of trucks to deliver
water to the province. The Amanat said that tankers were not an
efficient solution to the problem. They questioned who would be
responsible for the tankers and they pointedly stated that the
Baghdad Water Authority really should solve this problem.

6. Chairman of the Joint Planning Commission, Mr. Riyadh Filaheh
discussed the inadequate services in Ghazaliya, due largely to
militia influence. He reported that the JPC was reviewing service
sector areas by security districts, as designated in the Baghdad
Security Plan (BSP). The JPC will now review projects by political
districts to ensure all areas are completely reviewed. Riyadh also
noted that local councils have significant vacancies which continue
to hinder local service delivery and infrastructure improvements. He
said that individuals have volunteered, but were unqualified,
lacking formal educations or having criminal records. Dr. Chalabi
encouraged them to appoint local council members as quickly as

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Special Session on Health Issues - Sunday, January 20
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7. Dr. Chalabi, Dr. Adel, the Deputy Minister of Finance, the US
Embassy Health Attach, Dr. Tahseen (the FAQ spokesperson), and two
other representatives from MoH attended the special session on life
saving drugs procurement. The DG of pharmaceutical safety joined the
group at the very end of the meeting.

8. The first discussion revolved around the committee's previous
recommendation to pay doctors overtime for on-call services. The
Ministry of Finance (MoF) is still holding up this funding. Another
letter will be sent to the PM urging his interference in this

9. The group then discussed the best way to purchase 75 life saving

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drugs. They concluded that the current process is too cumbersome and
will not allow for an immediate resolution to the ongoing shortage.
The recommendation was adopted to send a letter to DPM Barham Saleh
to authorize the MoH to purchase life saving drugs from the private
sector directly, similar to the agreement the Ministry of Trade has
regarding food purchases. It is not clear how many vendors are
available to purchase drugs directly from in Iraq, but the IG
estimated 14 vendors. Chalabi questioned whether or not the MoH's
reputation with these vendors was strong enough for direct purchase.
The IG insisted it would work. Chalabi also suggested that the
current mandatory bidding process could be avoided if the MoH set a
fixed price and then allowed any vendors to sell the product if they
meet the MoH set price.

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10. After the lengthy holiday, the Services Committee seems to be
back in the swing of things, business as usual. The Ministry of
Electricity and the Baghdad Operations Command both were absent from
the meeting, which Chalabi expressly noted, promising to send a
letter to General Abhoud and Dr. Karim. An interesting observation
was Dr. Chalabi's remark that the work of the Services Committee is
not long-term, as that was the function of the ministries as well as
the Amanat and Provincial Council. He emphasized short-term,
immediate fixes.


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