Wednesday, November 15, 2006

Senate vote favors Iraq reconstruction watchdog

Senate vote favors Iraq reconstruction watchdog

WASHINGTON (Reuters) - The U.S. Senate voted on Tuesday to keep alive the federal agency that looks for waste and fraud in taxpayer-financed reconstruction projects in Iraq, hoping to reverse a recently passed law that would close the office next year.

On a voice vote, the chamber embraced a bipartisan plan to keep the office of the Special Inspector General for Iraq Reconstruction open until 10 months after 80 percent of the funds for Iraqi reconstruction have been spent, whenever that is.

"The important work of this watchdog must continue, as long as American funds are being used for Iraqi reconstruction," said Sen. Susan Collins, a Maine Republican and co-sponsor of the plan with Sen. Russ Feingold, a Wisconsin Democrat.

The office has focused on contracting problems involving large companies such as Halliburton, which was formerly headed by Vice President Dick Cheney. In one recent report, the office said Halliburton routinely hid information about its work in Iraq from the public by marking the data as proprietary when it wasn't.

The provision to extend the office's life was attached to a military construction spending bill that was expected to pass the Senate this week. Its fate in the House was unclear.

Some in the Senate have blamed House Republicans for the plan to close the inspector general's office next October, which was inserted earlier this year into legislation that President George W. Bush signed into law. House Republicans deny any stealth was involved in getting the provision approved.

Rep. Ike Skelton, a Missouri Democrat due to become chairman of the House Armed Services Committee, this week introduced legislation in the House to keep the office open. It also would give it oversight of a $1.7 billion U.S. fund set to train, equip and provide infrastructure for Iraqi security forces.

The agency, known by its acronym SIGIR and led by Inspector General Stuart Bowen, began work in January 2004 to track $18 billion in U.S. taxpayer dollars initially allocated for rebuilding Iraq.

SIGIR has issued 73 audit reports and 65 project assessments, resulting in the arrest of five people and the convictions of four for fraudulent use of taxpayer money.

In its latest quarterly report, the agency said it had 92 open investigations in Iraq, including 25 led by the Justice Department. It said its audits had resulted in a net potential economic impact of $405.1 million and its recommendations could boost Iraq's annual oil revenues by $1.3 billion.