Commission Claims $30 Billion of Waste in Iraq, Afghan Contracts

More than $30 billion has been wasted from U.S.-funded Iraq and Afghanistan contracts, according to the final report of a congressionally mandated commission.

That’s about one in every six dollars of the $192.5 billion spent on contracts and grants from fiscal 2002 to the middle of fiscal 2011, according to the Commission on Wartime Contracting. Expenditures are expected to reach $206 billion by the end of this fiscal year on Sept. 30, according to commission figures.

An additional $30 billion of the total spending “could again turn into waste if the host governments are unable or unwilling to sustain U.S.-funded projects after our involvement ends,” co-chairmen Christopher Shays and Michael Thibault wrote in a Washington Post column today.

“Those sobering but conservative numbers” reflect dollars wasted “through poor planning, vague and shifting requirements, inadequate competition, substandard contract management and oversight and subpar performance or outright misconduct by some contractors and federal employees,” they wrote.

Shays and Thibault highlighted the key findings of the panel’s final report scheduled for release Aug. 31.

The commission’s findings build on those of Special Inspector General For Iraq Reconstruction Stuart Bowen. He’s estimated that between 2003 and 2009 as much as $4 billion of the $21 billion Congress approved since 2003 for Iraq reconstruction has been wasted on excessive payments to contractors and poorly designed facilities.

The commission was established by the fiscal 2008 defense bill at the insistence of Senate Armed Services Committee members James Webb of Virginia and Claire McCaskill of Missouri. Both remain on the panel and are in position to push as amendments to the pending fiscal 2012 defense budget some of the 15 commission’s recommendations.

‘Not an Attack’

One recommendation calls for setting up a permanent inspector general’s office for wartime contracting staffed by a team of investigative personnel ready to deploy “to monitor preparedness” to enter into contracts.

Shays and Thibault wrote the final report “is not an attack on contractors.”

“In general, contractors have provided essential and effective support to U.S. personnel but the costs have been excessive, largely because of a shrunken federal acquisition workforce and lack of effective planning to use contractors and the discipline of competition,” they wrote.

Pentagon spokesman Colonel David Lapan told reporters today he wouldn’t directly comment on the report’s findings until it is released and officials review it.

The commission is one of many independent bodies to make recommendations, Lapan said.

“We are well aware of some of the deficiencies over the years in how we worked contracts,” he said. “We have worked hard over those years to try and correct those deficiencies when we come across them.”

To contact the reporter on this story: Tony Capaccio in Washington at acapaccio@bloomberg.net

To contact the editor responsible for this story: Mark Silva at msilva34@bloomberg.net

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