Accessibility links

Two US Senators Seek Competition in Future US Contracts in Iraq - 2003-09-27

Two U.S. Senators have introduced legislation aimed at ensuring competition on future contracts for work on the reconstruction of Iraq. It comes in the wake of allegations of favoritism in the contracts that have been awarded so far to companies doing work in Iraq.

The measure would require that funds for rebuilding Iraq be spent only on competitive contracts. If an agency awards a contract without bidding, it must notify Congress and explain why.

Senator Ron Wyden, an Oregon Democrat, is a sponsor, as is Senator Susan Collins, a Maine Republican.

"It is about ensuring fairness and openness when contracts are made to support our military to build the infrastructure," said Senator Collins. "That is why we want to make sure it is a transparent, open and competitive process that is used to award contracts."

The move comes in the wake of controversy involving Vice President Dick Cheney and a Texas-based energy conglomerate he once headed that is now doing work in Iraq.

Mr. Cheney was chief executive officer of the Halliburton Company from 1995 until August 2000. A subsidiary of the company is the main contractor working on restoration of Iraq's oil industry. Among the contracts it received is an open-ended one that was awarded without competitive bidding.

Congressional Democrats say Mr. Cheney has benefited from the deal. They say he has received hundreds of thousands of dollars from the company since taking office, but note that he has denied having a financial interest in the company. The vice president replied to such comments in a recent interview on NBC's Meet the Press.

"I have severed all my ties with the company, gotten rid of all my financial interests. I have no financial interests in Halliburton of any kind, and have not had [payments] now for over three years," he said.

A spokeswoman for Mr. Cheney, Cathie Martin, has since clarified the statement, saying the vice president has been receiving deferred compensation payments from the company. She said Mr. Cheney had already earned the salary that is now being paid, and that he bought an insurance policy to guarantee the deferred salary would be paid even if Halliburton went bankrupt.

But a new congressional report concludes that federal ethics laws consider Mr. Cheney's deferred payments a continuing financial interest in the company.

The report was prepared at the request of Senator Frank Lautenberg, a New Jersey Democrat, who says the findings raise ethical concerns.

"While the vice president is not technically violating the law, he is running afoul of ethics principles by maintaining financial interests in Halliburton while Halliburton receives massive contracts from this administration, including a no-bid, exclusive contract in Iraq that has already paid them over $1.2 billion," he said. "It is wrong, it is unethical, and it needs to stop."

Senator Lautenberg is calling for congressional hearings into the matter.