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UN reforms vital in wake of Oil-for-Food report

Annan stresses ‘vital importance’ of UN reforms in wake of Oil-for-Food report

Secretary-General Kofi Annan today underscored the “vital importance” of enacting management reforms in the United Nations after the Independent Inquiry Committee (IIC) into the Iraq Oil-for-Food Programme delivered its final report to the Security Council, finding both misadministration and evidence of corruption.

“There are hard lessons for all of us to learn,” Mr. Annan told the Council, after IIC head, former United States Federal Reserve Chairman Paul Volcker, presented the 15-member body with the report of the year-long investigation of the $64-billion programme under which the sanctions-bound regime of Saddam Hussein was allowed to sell oil to buy food, medicines and other essential supplies.

“They are lessons about the importance of accountability, and particularly of having clear lines of responsibility and reporting, so that all officials, and all parts of the Secretariat, know exactly where their responsibilities lie,” Mr. Annan added.

“They are lessons about oversight, and particularly about the need for mechanisms to ensure that, when oversight reveals deficiencies, someone takes prompt action to repair those deficiencies. And above all, they are lessons about the need for the United Nations to maintain the highest possible standards of integrity, and of effective performance.”

Mr. Annan stressed that the report found that despite the shortcomings, the very large and very complex programme accomplished many vital goals in Iraq, reversing a serious and deteriorating food crisis, preventing widespread hunger and probably reducing deaths due to malnutrition, while also helping to maintain the international effort to prevent Saddam Hussein from acquiring weapons of mass destruction.

It also found that “the wholesale corruption within the Programme took place among private companies manipulated” by Saddam Hussein's government.

He noted that the IIC reaffirmed that there was no evidence that he improperly influenced the procurement process in favour of Cotecna Inspection Services, which had employed his son, Kojo. Among the findings of mismanagement or corruption, the IIC concluded that the former Executive Director of the UN Office of the Iraq Programme, Benon Sevan, “corruptly benefited” from his role in the programme and accused former procurement officer Alexander Yakovlev of soliciting kickbacks.

But Mr. Annan accepted personal criticism, also expressed in preliminary IIC reports, of his reaction when he was first informed of the reports about Kojo Annan. “I accepted then, and still accept, the conclusion that I was not diligent or effective enough in pursuing an investigation after the fact, when I learned that the company which employed my son had won the humanitarian inspection contract,” he said. “I deeply regret that.”

But, he added, the findings about the general management of the Programme, characterized by weak administrative practices, and inadequate control and auditing, reflect on the system of decision-making, accountability and management throughout the Organization.

“Here too, as chief administrative officer, I have to take responsibility for the failings revealed, both in the implementation of the Programme and, more generally, in the functioning of the Secretariat,” he said.

The report finds that many of these problems were rooted in an unclear demarcation of roles and responsibilities between the Council, the 661 Committee (overseeing the programme) and the Secretariat – in particular by this Council's decision to retain substantial elements of operational control within the 661 committee, composed of national diplomats working under highly politicized instructions from their home governments, yet willing to take decisions only when there was unanimous consent among all the 15 members.

“But one thing should be clear right now,” he went on. “The Inquiry's findings underscore the vital importance of proposed management reforms, many of which are at this very minute being negotiated by Members in the General Assembly, with a view to their adoption, as part of a broader agenda of political and institutional change, by next week's summit,” he added, referring to the 2005 World Summit at UN Headquarters in New York.

“As you know, I have already embarked on new reforms in areas where I have discretion – reforms designed to improve the performance of senior management, to strengthen oversight and accountability, to increase transparency, and to ensure the highest standards of ethics, notably by creating a new Ethics Office. But there are many key decisions that only the General Assembly can make.”

Not only must a stronger and better-resourced oversight structure be fully independent of the Secretariat and from political interference by Member States, but “the Secretary-General himself should be allowed to carry out his functions effectively, taking day-to-day decisions on deployment of staff and resources without having to wait for prior approval from the General Assembly, or this Council, or their various committees,” he declared.

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