Tag Archives: Rosoboronpostavka

Clean Slate

Posted on April 1, 2013 | 1 comment

It took a brave man to tell the State Duma what department chief Aleksandr Piskunov said in the Audit Chamber’s annual legislative report in February.  Voyenno-promyshlennyy kuryer published excerpts of his remarks.

Piskunov’s a government official.  Not a powerful voice, but an authoritative one in his specialty.

Auditor Aleksandr Piskunov

Auditor Aleksandr Piskunov

To say he’s well-equipped for his work is an understatement. 

Sixty-one or 62 years old, Piskunov graduated from the RVSN’s Dzherzhinskiy Military Academy with a radio engineering degree.  He served on active duty to the rank of general-major, spending many years at the Plesetsk cosmodrome.  He later trained in the RF Government’s Financial Academy and a business school in London.  He has a PhD in economics.

Piskunov served in both the RSFSR Supreme Soviet and State Duma in the early 1990s, and was deputy chairman of the Defense Committee for each body.  He also chaired the Defense Ministry’s Military-Technical Policy Committee.  In the mid-1990s, he moved to the staff (apparat) of the RF Government and was deputy chairman of its Committee on Military-Industrial Issues.

He returned to the Duma briefly in 1999, and became deputy chairman of its “Regions of Russia” faction.

He went to the Audit Chamber in 2001, and is currently in his third term of service.

Piskunov thinks Russia can’t produce new, better, or more weapons and military equipment without modernizing its badly neglected defense industrial base.  But he has pretty much nothing but scorn for the current management of the state defense order.  And he sees little but failure in the GPV over the last 20 years.  In particular, Piskunov calls for incorporating life cycle costs into the GPV.  Ultimately, however, he says auditors and accountants can’t fix the GOZ or GPV, but lawmakers could.

Enough preamble.  Here’s VPK’s excerpt of Piskunov’s remarks.

“STRICT CONTROL OF FULFILLING THE ARMAMENTS PROGRAM IS NEEDED”

“I represent a department that performs strategic audits in the Audit Chamber.  We’ve done a lot of work in evaluating the condition of practically all 1,350 enterprises of the defense-industrial complex, their financial stability and real contribution to equipping the Armed Forces.”

“We looked at how balanced the program of defense-industrial complex modernization and State Program of Armaments were.  A gap of 700 billion rubles was observed.  At the same time, 1 trillion 200 billion is built into the budget to guarantee compensation to enterprise directors who go to commercial banks for credits.”

“Similar credit practices are leading to the growth of OPK enterprises with an unstable financial situation.  More than 30 percent are like this.  Only 20 percent come close to world standards in technical equipping.  More than half are in a condition where their restoration is already senseless — it would be better to build from a clean slate.”

“In preparing the law on the state defense order we tried to correct this situation.”

“From my point of view, our system of administering the state defense order is uncompetitive.  The adopted law preserved the situation under which  management amounts to a lag in the state defense order.”

“The deputy prime minister, responsible for the defense-industrial complex, reported that the state defense order was fulfilled by 99 percent as in past years.  But almost one hundred percent fulfillment of state defense orders over the last 20 years has not prevented the failure of all arms programs or fulfilling them at 30, 40, 50 percent.”

“Dmitriy Rogozin himself noted that fulfillment happened because of the appearance of realization.  During the execution of the arms program 7,200 changes were introduced into it, that is the real result is being slanted to agree with this fact.”

“Meanwhile Rogozin recognized that the arms program has gotten old.  The task of preparing a new State Program of Armaments stands before him.  So the problem of forming a legislative basis and management of the State Program of Armaments is more acute than ever.”

“Our opponents in government, having considered it inexpedient to include the management of the acquisition program life cycle in the GOZ law, said it was necessary to include this management in the law on the State Program of Armaments.”

“To me it seems necessary in this instance to hold them to their word — to propose that the government prepare a draft law on the State Program of Armaments.  It’s possible this will allow us to compensate for not realizing it in the GOZ law, and meet the president’s demand to create essential management of the life cycle of weapons systems.  But today the state of affairs is seriously complicated by the fact that the life cycle is really torn into several parts in the Defense Ministry itself.”

“Those who’ve served understand:  you can’t modernize armaments without the experience of using them.  Who really tracks all this life cycle?  It would be logical if Rosoboronpostavka were occupied with this, but it is located at the junction of the functional orderer — a service of the Armed Forces and a contracting firm.  It would be more appropriate to subordinate this department to the government.  It’s perfectly clear that the main risks are connected not to corruption, but to the low qualifications of the orderer.  Someone needs to “hang” over the orderer from the point of view of its responsibility for how both the program and the contract as a unitary whole are being executed.  Juridical responsibility is not rebuilt only through the contract.”

“The level of project management in our ‘defense sector,’ unfortunately, is also very low, especially the quality management system.  We are all witness to what is happening now in space.”

“It’s frightening that it’s impossible to create new equipment without metrics.  We lost the project management culture and stopped training specialists in military academies and schools.  The very best on this plane is OOO ‘KB Sukhoy’ and it used the American experience-plan for metrics on developmental aircraft.  The Americans seized and simply closed the issue — this project is no longer being supported.  To rewrite project documentation now in some kind of domestic variant is complex, therefore the development of these systems is essential.”

“The participation of commercial banks in providing credit for the state defense order is an important question.  Now in the government they are discussing how these 23 trillion will go — through commercial banks, for free or for money?  It’s understood that banks simply don’t work that way.  There is a precedent — the government resolution on the Mariinka, the Bolshoy [theaters], the M-4 [highway].  If you calculate it, then 20 percent received from 23 trillion over these years, it’s necessary to take an additional amount from the taxpayers or cut the defense order by this sum.”

“Not less sensitive is the issue of intermediaries.  If the Defense Ministry and government don’t put transactions under the strictest control, then there are all the calculations on the defense order, life cycle and cooperation levels, we will mess up this program of armaments also.  This, undoubtedly, is one of the most dangerous questions for the Defense Ministry — too large lobbyist forces participating, too large sums going.”

“Questions of managing the life cycle and control of finances are the most fundamental.  The treasury is incapable of resolving this task.”

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Defense Ministry Collegium

Posted on November 23, 2011 | Leave a comment

Serdyukov Flanked by Makarov and Pankov

November’s the time for year-end evaluations in the Russian military, and the Defense Ministry had its collegium yesterday.  Mil.ru printed Defense Minister Serdyukov’s introductory remarks.

First on his mind was complete fulfillment of the State Defense Order next year, and signing all GOZ-2012 contracts next month.  He said all responsibility for ordering will be transferred to a “Federal Procurement Agency.”

Some media sources assumed this means Rosoboronpostavka.  This author thinks it could be something new.  It’s important, so here’s exactly what Mil.ru says he said:

“Next year the functions of the ordering organ are being fully transferred to the Federal Procurement Agency.”

If that means Rosoboronpostavka, why not just say Rosoboronpostavka?  ITAR-TASS actually replaced Serdyukov’s words “Federal Procurement Agency” with Rosoboronpostavka.  At the very least, not everyone’s working from the same sheet of music.  But continuing with Serdyukov’s remarks . . .

Unlike large-scale strategic exercises of recent years, the coming year will stress tactical-level training.  But Southern MD exercises will test the new Armed Forces command and control system.

He noted establishment of VVKO by December 1, and said it will “intercept any targets right up to hypersonic speeds, both in the air and in space.”

Military police will start working in the troops in 2012, according to Serdyukov.  They are still occupied at present with selecting personnel, writing regs, etc.  Serdyukov earlier said they’d be functioning in 2011.

The Defense Minister indicated all service functions in the Armed Forces will be outsourced next year.

Without much fanfare, he said the new system of enlisted contract service will start in 2012.

Serdyukov said stimulus pay for officers will continue alongside their newly-approved higher pay.

First Deputy Defense Minister, Chief of the General Staff Nikolay Makarov delivered the collegium’s main report, but the press wasn’t invited to stay.

Meanwhile, today NG sources “don’t exclude” that Anatoliy Serdyukov could soon leave the Defense Ministry to become Finance Minister.  There’s talk Russia’s NATO Permrep Dmitriy Rogozin could succeed him as Defense Minister [because he toured the 58th Army with Medvedev this week].

There are always rumors like these.  Recently it was said Makarov would be “sacrificed” as an electoral offering to military men who don’t like him.  Sometimes the rumors bear out, sometimes not.  More important are the reasons behind any personnel changes. 

Is Putin or Medvedev likely to find a more effective steward of the military than Serdyukov?  Probably not.  The fiery politician Rogozin would be a dramatic change from the retiring technocrat Serdyukov.  The former would inspire and appeal to the troops more than the latter, but not do a better job.  Of course, we shouldn’t assume capability is the leadership’s most important criterion in picking a Defense Minister.

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Posted in Command and Control, Military Leadership, Rear Services, Serdyukov's Reforms

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For Most Corrupt . . .

Posted on June 12, 2011 | 1 comment

The winner is . . . the Ministry of Defense.  Novaya gazeta assembled respected independent experts to judge which of the Russian government’s 35 ministries and departments is most corrupt.

The Defense Ministry edged out the Transportation and Economic Development Ministries.  The experts said the five most corrupt (Health and Social Development is fourth and Finance fifth) have the opportunity to “saw off” 100 million to 1 trillion rubles per year (including budget money, and money that doesn’t reach the budget).

A little context.  Recall Defense Minister Anatoliy Serdyukov arrived four plus years ago promising to bring the Armed Forces’ notorious “financial flows” under strict control.  But corruption scandals have only continued to flare around the Arbat Military District.  Just a casual recent look:  the Main Military Prosecutor says 20 percent of GOZ money is being stolen, Lipetsk highlights widespread premium pay extortion, the Chief of the Main Military-Medical Directorate is arrested for corruption.  The list could go on.

Look at the Novaya story in the vernacular for links to its original sources.  Its experts focused on the closed nature of the defense budget, the impossibility of accounting for money allegedly spent on military R&D, the inability to confirm that work was actually performed, inflated prices, and a high rate of kickbacks.

But they also focused on the simple fact that no one is officially in charge of significant amounts of defense money in the federal budget.  Just by looking at budget lines, it’s clear to them that 600 billion rubles in defense spending (and perhaps much more) are simply unaccounted for.

They also focused on Defense Ministry FGUPs that haul in enormous profits but remit little into the budget.  And lastly they noted that fake health deferments from Voyenkomaty amount to an illicit 150-billion-ruble business every year. 

This is how they summarize the corruption situation in the Defense Ministry (below распил or saw cut, a share or cut of illegally obtained money, is translated as sawed off): 

“1.  Anatoliy Serdyukov’s Defense Ministry is the richest and also the most closed of Russian ministries and departments.  This is precisely why the experts considered it the ‘goldmine of the corrupt,’ that is absolute leader in the volume of money which it’s possible to write off  without supervision as ‘expenses,’ the reality of which society doesn’t have the slightest chance of verifying.  The first corruption scandal in the new (Yeltsin-Putin) Russia is directly connected with the Defense Ministry – the plunder of Western Group of Forces property which broke out in 1992-93.”

“In the opinion of experts polled, ‘today’s army purchases and especially ‘development,’ ‘research and development work’ for the army is that sphere where it’s possible to put up to 90% or more of state financing in your own pocket peacefully and where there’s no kind of limit at all.  Not even comparable is civilian construction done at state budget expense, where it would seem there should be the greatest percentage of corruption, but there is a limit there:  in construction it’s necessary to present a final result – a finished facility, therefore here it’s possible to put a maximum of 70% of state resources in your pocket without punishment.  In army ‘development’ there’s no accounting, everything’s classified, and this means it’s impossible to check, therefore in the Defense Ministry they ‘lose’ fantastic sums.  This comes to light only rarely, when military journalists make note of ‘new developments’ at Defense Ministry exhibitions which they already saw several years before.  Meanwhile, the Defense Ministry objects to this:  no, this isn’t old, it’s new, but meticulous military journalists show photos from previous years in which even the serial numbers are the very same as in the new exhibition.”

“Such expert evaluations are largely supported by the not numerous checks of the Main Military Prosecutor when they conduct them.  So, not long ago, the results of checks into the Defense Ministry’s 13th GNII and the Main Military-Medical Directorate, where ‘large-scale thefts of financial resources’ were revealed, were substantiated.  ‘Just in several instances of criminal activity by officials of the 13th GNII and ZAO ‘Kulon’ the theft of more than 40 million rubles was revealed – this is the amount of work which was never fulfilled.  A criminal case in relation to a group of Defense Ministry Main Military-Medical Directorate and State Order Directorate personnel was launched:  they concluded a state contract with a commercial firm to supply medical equipment for more than 26 million rubles, the cost of the equipment purchased from the businessmen was inflated more than 3 times, and the state took a loss of more than 17 million,’ acknowledged the Chief of the Second Directorate of the Main Military Procuracy General-Major of Justice Aleksandr Nikitin.”

“In Kirill Kabanov’s estimation, ‘the figure of 1 trillion rubles which the budget loses in purchases could be understated.  Kickbacks in our state procurement system are 30-40%, in open areas kickbacks are 20%, but in closed, monopolistic ones they go up to 60% — in the Defense Ministry, for example.’“

“‘The Defense Ministry, of course, is the kingdom of the fearlessly corrupt.  The ability to classify everything in the world powerfully helps in ‘sawing off’ activity,’ – states Aleksey Navalnyy.”

“The potential corruption of ‘defense expenditures’ lies not just on the fact that society can’t concretely check the designation of every billion of military spending, but it doesn’t even have chances to find out precisely which ministry or department exactly bears responsibility for a good half of ‘defense’ expenditures.  For example, in 2010, the expenditures of the RF federal budget were 10.116 trillion rubles – both the Finance Ministry official site and the Rostat official site attest to this.  But of these only 9.052 was officially distributed among ministries and departments, and more than 1.06 trillion rubles was used by someone unknown, meanwhile more than half of them (0.6 trillion) went to ‘defense expenditures!’  An even more outrageous situation was planned in the RF budget laws for the following years:  in 2011, expenditures are 10.65 trillion, only 9.35 of which are signed off to a departmental structure, in 2012 — 11.3 trillion and 9.4 trillion, in 2013 — 12.2 trillion and 9.5 trillion accordingly, that is with every year the share of ‘no one’s’ expenditures will grow even larger . . .”

“In 2010, budget expenditures ‘on defense’ were 1.28 trillion (!) rubles.  Meanwhile, the Defense Ministry spent 0.98 trillion, of which 0.64 trillion were ‘on defense,’ but the remaining 0.34 trillion — on communal services, education, health, film, TV and pensions.  Spending of the remaining departments ‘on defense’ was in the amount of 0.041 trillion (Minpromtorg –32.4 billion, Rosatom –3.7 billion, Roskosmos — 0.9 billion, Rosaviatsiya — 0.6 billion, etc.; the Defense Ministry’s departments:  Spetsstroy — 1.8 billion, Rosoboronpostavka — 0.5 billion, Rosoboronzakaz — 0.3 billion, FSVTS — 0.3 billion, FSTEK — 0.0 [sic] billion rubles), the total expenditures of all departments ‘on defense’ — 0.68 trillion rubles.  But it’s unknown who — unknown even which ministry or department spent all of 0.6 trillion rubles ‘on defense!!’  It’s understandable that they were spent on the Defense Ministry’s business, but why hide this (no ‘military secret’ really suffers, if the Defense Ministry acknowledges that it spent not 1 trillion, but an entire 1.6 trillion in a year), isn’t it because it’s so much easier to steal ‘no one’s’ 600 billion in defense money?”

“It’s not known which departments spend not just 0.6 trillion in expenditures ‘on defense,’ but also 0.46 trillion of other spending — a number of experts believe they are almost all under the Defense Ministry’s control, the real budget of which is twice as much as the official one and amounts to 2 trillion a year.  So half of this (or even more), in experts’ opinions, gets ‘sawed off.'”

“However, the ‘fat’ life of the Defense Ministry leadership doesn’t end with this.  It turns out to be unknown how and why 15 thousand pieces of property belong to the Defense Ministry.  Where and to whom the proceeds from the use of them go – God only knows.  But on the other hand it is known that they are still also gathering up money for housing construction on these Defense Ministry lands from simple people who then turn into deceived investors.”

“Moreover, the Defense Ministry directs 352 FGUPs (Federal State Unitary Enterprises), from which even in the crisis year 2008, the Defense Ministry received 39.3 billion rubles in proceeds, but there are problems with remitting the profits into the federal budget:  it remitted only 0.092 billion of them.  Another 126 FGUPs are directed by Defense Ministry subordinate Spetsstroy and there’s the same situation with it:  proceeds in 2008 were 62.4 billion, and only 0.017 billion in profits remitted to the federal budget.  Defense Ministry subordinates FSTEK and Rosoboronzakaz direct 4 and 3 FGUPs respectively, their proceeds are 0.8 and 0.2 billion respectively, profits remitted to the budget are 0.001 and 0.0002 billion respectively.”

“The Defense Ministry and its subordinate Rosoboronpostavka glorified themselves with outrageous expenditures of dozens of budget millions to buy furniture for their leadership – certainly made of gold, beautiful wood and natural buffalo hide.  The main defender of the Motherland wouldn’t sit or work on any other furniture . . .  Just three such orders for the leadership cost the budget 60 million rubles, and at the same time 7 million was spent for furniture for average Defense Ministry and Rosoboronpostavka personnel. The Defense Ministry made it known that it also wrote off 45 million on ‘media monitoring’ in 2010(!).”

“The Defense Ministry’s subordinate Spetsstroy has been highlighted in corruption scandals:  in 2010, just one of its FGUPs tried to ‘con’ four banks out of more than 500 million rubles, by not returning credits taken from them and attempting to organize the ‘bankruptcy’ of Spetsstroy FGUPs . . .”

“Besides, in the experts’ opinion, ‘the main preoccupation of voyenkomaty in the last two decades has become the collection of bribes from conscripts,’ since ‘from 80% to 90% of deferments for health are given by voyenkomaty for bribes – exactly for this reason the Defense Ministry is demanding the lifting of student deferments, lifting deferments for the fathers of newborns, but never demands lifting deferments for health.’  Every year nearly 600 thousand deferments ‘for health’ are issued, almost all are for bribes which run in various RF regions from 200 to 400 thousand rubles, so, the overall trade in voyenkomat bribes is nearly 150 billion rubles a year, the experts believe.”

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Rosoboronpostavka Understaffed, Ineffective?

Posted on March 15, 2011 | Leave a comment

This author has written several times that Rosoboronpostavka – the Federal Agency for Supplies of Armaments, Military, Special Equipment and Material Resources – is supposed to be key to making the GOZ and GPV work.  It’s supposed to take responsibility for negotiating, contracting and taking deliveries out of the hands of military men, so they aren’t tempted by bribes and kickbacks from manufacturers, and can concentrate on the specific requirements for weapons and equipment that needs to be made and bought.

In mid-2010, erstwhile Putin ally Viktor Cherkesov (who once warned of infighting and corruption among high-ranking security service veterans) was unceremoniously booted from Rosoboronpostavka.  President Dmitriy Medvedev criticized the agency (and Cherkesov) for not accomplishing much, and he moved it under the Defense Ministry, declaring that it would become a reinvigorated part of the effort to rearm the Armed Forces during the next decade.

Nadezhda Sinikova

With great fanfare, Defense Minister Serdyukov’s confidant, Nadezhda Sinikova took over at Rosoboronpostavka.  This all fit pretty well with Serdyukov’s general intent – to establish strict control over the Defense Ministry’s “financial flows,” and to civilianize Defense Ministry functions that aren’t clearly military in nature.

It’s seemed that Sinikova’s Rosoboronpostavka has remained stillborn, much like it was prior to mid-2010.  At least, nothing was heard from or about it until a 3 March article in Rosbalt.ru.  Now we have to be wary — Cherkesov’s wife, Natalya Chaplina is Rosbalt’s General Director.  Be that as it may, the article seems pretty solid.

According to Rosbalt.ru, Rosstat published data on salaries in the federal executive organs, and experts were surprised the highest average paychecks — 135,000 rubles per month or more than 1.6 million rubles per year — are in Rosoboronpostavka, an organization not even really functioning.  The average 12-month federal salary is 728,000 rubles, about 60,000 per month.
 
Rosoboronpostavka is working only in a technical sense.  The different power ministries and departments haven’t hurried to hand over authority to conclude contracts for them, and they’ve tried to sabotage the agency’s work, according to Igor Korotchenko. 

Rosoboronpostavka’s supposed to have 1,100 professional employees, 980 in the Moscow headquarters.  A source close to Rosoboronpostavka claims that, prior to mid-2010, not more than 10 people worked for the agency, and it didn’t have its own office.  They worked in a room in Rosoboroneksport on Moscow’s Ozerkovskiy Embankment. 

The Rosstat data says Rosoboronpostavka has the lowest staffing level of any executive structure, only 15.5 percent or 152 people against an authorized level of 980.
 
Before the mid-2010 changes, Rosoboronpostavka salaries had been 50-70,000 per month; the director got 70,000 and he reported to Prime Minister Putin.  Now, with its status downgraded and reporting to the Defense Minister, the agency’s pay has increased several times.
 
Experts think the pay’s kept high because the country’s leadership wants to deter corruption in the state defense order (GOZ), but deputy editor-in-chief  the journal “Armaments and Economics,” Professor Sergey Vikulov says this high pay comes “from the naive belief of our leaders that high pay will deter bureaucrats from bribery.” 

One notes Vikulov’s journal is the professional publication of the 46th TsNII, not exactly an objective voice since it used to form the GOZ (and probably collect the bribes) pretty autonomously before Rosoboronpostavka was established.
 
Korotchenko believes even bureaucrats who earn millions will be tempted to “saw off” part of the billion-ruble contracts they oversee.  He goes on to say  corruption in the Defense Ministry directorates occupied with the GOZ and the OPK already caused the failure of the two previous state programs of armaments (GPVs).
 
Rosbalt.ru also claims the Audit Chamber has said GOZ-2009 was only 50 percent completed.  Then it cites NG‘s (Mukhin’s) 70 percent fulfillment figure for GOZ-2010.

Although one expert hopes higher pay at the agency is tied to greater productivity in processing contracts, a Rosbalt.ru source says as before only a small number of contracts are being completed.  The expert is just about ready to give up searching for a logical explanation for the lack of elementary order in Russia’s management structures. 

But Korotchenko thinks it might be early to judge Rosoboronpostavka, since it’s still establishing itself.  Perhaps at the end of this year or the beginning of next, it will take over all power ministry arms and equipment procurement contracting, he says.

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Two More Perspectives on Serdyukov Flap

Posted on October 25, 2010 | Leave a comment

Defense Minister Serdyukov (photo: RIA Novosti)

A couple more interesting ones today . . . .

Calls for Serdyukov to resign seen as an effort to stop the ‘revolution from above’ . . . journalist Mikhail Leontyev told United Russia’s website:

“Serdyukov is a very severe man.  He’s conducting a very severe reform.  The very logic and mission of reform is merciless in relation to many people.  Serdyukov himself and others understand this, but this is not a reason not to renovate the army.  Reform is being conducted from аbove and by a man who’s a stranger to the army.  Moreover such a task was set from the beginning so it would be exactly like this.  Because they won’t ever do anything to ‘their own.’  In essence, the system is resisting.  Many would want to stop military reform at the current stage but this is stupidity.  Therefore a rumor beneficial to a large number of people is launched that they’re removing Serdyukov.”

Serdyukov almost a victim of his own success when it comes to making military officers focus exclusively on military affairs . . . Aleksandr Golts writes in today’s Yezhednevnyy zhurnal:

“The entire business, in my view, consists in the fact that a new revolution is ripening in the armed forces today.  They are removing officers, almost to the very top, from the heavy responsibility of distributing finances.  Unit commanders and district commanders alike henceforth don’t need to answer for the work of a boiler or cafeteria, or for guaranteeing electricity to the district’s troops.  Civilian departments — Oboronservis, Rosoboronpostavka and the like — will be occupied with supporting the troops with all essentials — from ammunition to the most complex armaments.  Military reformers set as their goal to put an end forever to commanders as ‘big business managers.’  In the course of decades, the commander was hardly evaluated by senior chiefs according to how he trained his unit for action on the battlefield.  They evaluated him according to whether he succeeded in building the cafeteria or bathhouse ‘efficiently,’ that is without allocating the necessary resources.  All this submerged commanders in tangles of corrupt relationships.  Besides lumber and bricks, the officer could pay his debts with the help of a natural resource which was at his disposal — a free work force.  If in Soviet times this system was somewhat limited by party control, then in the 1990s, when the state didn’t have any money at all to support its gigantic military machine, military units were practically condemned to self-support.  As a result, now officers have come to be brigade commanders and deputy army commanders who know perfectly how to ‘operate,’ but not to command.  This is not their fault, but their misfortune.  And the Defense Ministry is creating a special system for retraining senior and higher officer personnel [to learn or relearn their strictly military business].”

“But far from all military leaders are inspired by the prospect of perfecting troop command and control, and combat training methods day and night, meanwhile having at their disposal only that money that came to their personal bank card from their salary.  Many long ago became accustomed to side profits which now seem like their base pay.  In the minister’s innovations, they see the main threat to their interests.  And, as we’re seeing, they aren’t standing on ceremony.”

No, they aren’t standing on ceremony.  They’re using the opportunity to come after the guy who dared threaten their profitable arrangements.  Who knows how widespread this kind of corruption is, but it certainly exists and those benefiting don’t want it to end.  Similarly, one can only guess to what extent Serdyukov’s been successful instituting his civilian control over Defense Ministry financial flows.  And no one should assume the civilian hands on these flows will be any cleaner.

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Posted in Crime and Corruption, Military Leadership, Rear Services, Serdyukov's Reforms, VDV

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Emblem of Procurement Problems

Posted on August 28, 2010 | Leave a comment

On Friday, amidst Krasnaya zvezda’s usual fare, there was interesting coverage of a high-level meeting to review the military’s UAV (BPLA or БПЛА) procurement program.

Technically, it was a session of the collegium of the Federal Service for the Defense Order (Rosoboronzakaz or Рособоронзаказ) with the agenda item “Results of Inspecting the Placement and Fulfillment of the State Defense Order (GOZ) in the Area of Development and Supply of Unmanned Aerial Vehicles.”

Rosoboronzakaz Director Aleksandr Sukhorukov, a former Serdyukov tax service deputy, conducted the session.  Also participating were newly-minted Deputy Defense Minister Tatyana Shevtsova, also a former Serdyukov tax service deputy, and Director of the Federal Agency for Supplies of Armaments, Military and Special Equipment, and Material Resources (Rosoboronpostavka), Nadezhda Sinikova, another of the Defense Minister’s long-time proteges.

The military paper noted that representatives of the government, ministries, and other federal executive organs, state customers from the Defense Ministry, FSB, FSO, MVD, and MChS, representatives of the Main Military Prosecutor, and OPK officials also attended.

One Yu. Stolyarov gave the main report.  He’s Chief of the Directorate of Oversight of the State Defense Order in the Area of General Armaments and Military Equipment, Aviation Equipment, Aerospace Defense Means and Armaments, Ships, and Naval Armaments and Military Equipment.  Quite a broad portfolio.  Krasnaya zvezda didn’t elaborate on what Mr. Stolyarov said, however.

Ground Troops CINC, General-Colonel Aleksandr Postnikov, VDV Chief of Staff and First Deputy Commander, General-Lieutenant Nikolay Ignatov, an OAO Tupolev deputy chief designer, and OAO ‘Vega’ Radiobuilding Concern General Director, V. Verba also spoke at the session.  Their remarks weren’t reported either.

Krasnaya zvezda reported that all presentations were thorough and constructive, and the collegium adopted some draft directive, but we don’t know what it said.  The paper, however, says the main theme of all presentations was the same:

“. . . in their TTKh (ТТХ – tactical-technical characteristics) domestic UAVs must not lag behind foreign ones and it’s essential to do everything to achieve this.  State money has to be spent with maximum effectiveness.  Troops and power structures need to be supplied with those UAVs that will be most effective on the battlefield, and in conducting special operations.”

What should we conclude from this?  Firstly, the meeting highlighted Shevtsova’s new oversight and auditing role in procurement.

Secondly, the Defense Ministry’s leaving the door open for domestic UAV producers, and so this seems to amount to just another warning to them.  It doesn’t seem to be anything like a decision to include Russian firms or exclude foreign ones, or vice versa.

It’s not surprising the Defense Ministry highlighted this particular program review.  Few procurement issues have caused Russia as much angst recently as UAVs. 

Georgia’s Israeli-supplied UAV capabilities, and Russia’s relative lack of them, highlighted this issue in 2008.  Moscow had to risk manned aircraft instead of employing unmanned ones on reconnaissance missions.  What’s worse, two years after the five-day war, there’s still no fix to the UAV problem.  And it will become more acute should unmanned aircraft become the backbone of future air power for the world’s leading militaries.  Russia’s clearly behind on UAVs, and questions remain about whether it should catch up, and whether it can.

The Russian defense establishment has spent months debating buying from foreign manufacturers, purchasing sample quantities abroad, or producing jointly to jumpstart or pressure domestic producers.  In late 2009, Air Forces CINC, General-Colonel Zelin flatly stated it would be ‘criminal’ to accept inferior Russian UAVs into the arms inventory.  The FSB reportedly said it would buy Israeli UAVs.  In March, Defense Minister Serdyukov admitted domestic UAVs ‘seriously lag’ behind world standards, and, in April, then Armaments Chief, now First Deputy Defense Minister Popovkin reported that Russia had spent 5 billion rubles on UAVs without result.

So UAVs joined the list of other systems – helicopter carriers, soldier systems, light armored vehicles, etc. – that could be bought abroad, but it doesn’t look like Moscow is ready to rely, at least entirely, on foreign producers for any of them.

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