Purposeless purchases of military equipment and machinery enabled by a lacking concept of the Ministry of Defence

Press Release – November 18, 2013

The Supreme Audit Office (SAO) performed an audit of state budget funds spent on purchases of military equipment and machinery for land and special military forces of the Czech Armed Forces. Auditors scrutinized 15 purchases with the total expenditures in the amount of CZK 5,800 million.

The Ministry of Defence failed to produce a concept material, which would outline principles and details of the land and specialized forces and their development and would also define the target state, material needs, financial requirements, and time schedule for meeting the goals. As a result, purposeless purchases of military machinery and equipment occurred. Subject, schedule, and financial conditions, which had originally been defined for purchases of military equipment, were radically changed during the implementation periods of the audited programs, the changes also included amounts and prices of the purchased items.

Several problems were revealed with the purchase of chemical kits for observers. According to the original investment purpose plan from July 2005, 129 kits worth CZK 65 million were to be purchased. After some development and military tests, the Ministry decreased the number of necessary kits from 129 to 87. Thus the purchase price of one chemical kit increased by some 50 % – from CZK 501,000 to CZK 752,000.

Financial requirements of another programme increased by 42 %, namely because the programme additionally included purchases of special vehicles, which should have been used in topical abroad missions. Due to changes to the military and political state of affairs, some of the vehicles purchased in 2010 for the total amount of CZK 121 million have not been used in abroad missions yet.

During the auditing operation, auditors scrutinized 13 awarding procedures. Only in four cases, the Ministry of Defence opted for open procedures and similar methods. In the other nine cases, the Ministry only negotiated with one supplier because of various reasons. Auditors warned that the competition is limited when such a course of action is preferred, and purchase prices are negatively influenced as a consequence.

For further details about auditing operation No. 12/33 (in Czech only), see the following link: http://www.nku.cz/assets/media/informace-12-33.pdf.

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