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Special Inspector General for Iraq Reconstruction (SIGIR)
January 30, 2006 Quarterly and Semiannual Report to Congress

January 30, 2006 Cover"During the past quarter, the Special Inspector General for Iraq Reconstruction (SIGIR) continued to advance aggressive oversight of the use of U.S. funds in Iraq’s reconstruction. In executing its responsibilities, SIGIR promotes the efficiency and effectiveness of the U.S. reconstruction program and ensures that taxpayer dollars are spent wisely. Moreover, SIGIR’s role in Iraq’s reconstruction aims to help secure the overall success of the U.S. effort and thereby honor the sacrifices of the soldiers and contractors killed or wounded.

SIGIR’s most notable achievements during the past quarter were the arrests of four U.S. citizens for bribery, fraud, and theft involving Iraq reconstruction funds on contracts valued at more than $13 million. These arrests signal that the United States is unequivocally committed to fighting corruption and promoting accountability on all fronts in Iraq.

SIGIR’s Audit and Inspections divisions continued to focus oversight on the reconstruction gap, the cost to complete reconstruction projects, the sustainability of completed projects, the effort to fight corruption in Iraq, and the persistent need to develop an effective reconstruction project database. Future audits and inspections will provide further reporting on these and other issues.

With the issuance of this Quarterly Report, SIGIR introduces the review of a new issue—transition."

2006 will be a year of transition for the U.S. reconstruction program in Iraq. The successful December 2005 elections launched Iraq into a new phase of its history. The first government elected under Iraq's new constitution is now forming and will soon assume responsibility for managing Iraq's economy and infrastructure. These developments will fundamentally alter the nature of the U.S./Iraq relationship on many levels, including reconstruction.

By the end of FY 2006, the United States expects to have fully obligated the Iraq Relief and Reconstruction Fund (IRRF). IRRF dollars represent only a portion of the amount estimated by the World Bank and United Nations (UN) to be necessary to restore Iraq's infrastructure, and the IRRF has provided a substantial down payment on what will be a lengthy restoration process. The progress made thus far with U.S. reconstruction funds has supplied the new Iraqi government with a significant start toward establishing an effective infrastructure and eventual prosperity.

As more and more IRRF projects are completed, the U.S. agencies and elements that currently manage and implement the overall U.S. reconstruction effort-including the Iraq Reconstruction Management Office (IRMO) and the U.S. Army Corps of Engineers Gulf Region Division Project and Contracting Office (GRD-PCO)2-will implement transition strategies to ensure that completed projects and related assets are turned over to the appropriate Iraqi officials who have the training and budgetary resources necessary to sustain them. As the transition process gains momentum, the U.S. reconstruction presence in Iraq will begin to shift toward foreign assistance programs managed by the Department of State (DoS) and the U.S. Agency for International Development (USAID).

Regarding the reconstruction transition, SIGIR has several concerns:

  • Do all of the U.S. reconstruction implementing agencies in Iraq have strategic plans in place for transitioning their respective parts of the reconstruction program?
  • Are there sufficient resources to support capacity development for national and local government officials, operations and maintenance, infrastructure security, development of strategic cities, and private sector development?
  • Have Iraqi officials sufficiently budgeted and planned for the essential maintenance of the new, U.S.-provided infrastructure?
  • Is the United States prepared to sustain the reconstruction presence required to complete planned projects that may take another three or four years to complete?

SIGIR has learned that an IRMO transition team is reviewing the critical issue of funding sustainment in the near term. Additionally, the Department of Defense (DoD) and DoS have begun transition planning for their respective areas of responsibility. This quarter, USAID presented a plan for transitioning U.S. assistance from the infrastructure-focused IRRF reconstruction effort to a more traditional technical assistance strategy. Thus, there are significant signs that transition planning is being implemented. But the importance of this issue compels SIGIR to announce a new audit that will review all reconstruction transition planning. SIGIR continues to follow a number of critical issues raised in earlier Quarterly Reports:

  • the "reconstruction gap"
  • sustainability
  • cost-to-complete estimates
  • anticorruption efforts in Iraq
  • information systems management "

January 30, 2006 Report File Type File Size Date
January 30, 2006 Quarterly and Semiannual Report to Congress PDF 4,753 KB 01/30/06
Acronyms and Definitions PDF 56 KB 01/30/06
Endnotes PDF 87 KB 01/30/06
Appendix A - Statutory Requirements PDF 37 KB 01/30/06
Appendix B – Cross-Reference of Report to IG Act of 1978 PDF 28 KB 01/30/06
Appendix C – U.S. Appropriated Funds PDF 156 KB 01/30/06
Appendix D – IRRF Apportionments by agency PDF 111 KB 01/30/06
Appendix E – Iraqi Funds PDF 61 KB 01/30/06
Appendix F – Donor Funds PDF 84 KB 01/30/06
Appendix G – SIGIR Audits PDF 34 KB 01/30/06
Appendix H – All U.S. Audits PDF 540 KB 01/30/06
Appendix I - List of Contracts PDF 357 KB 01/30/06
Appendix J - Sector Cross Reference PDF 33 KB 01/30/06
Appendix K - Department of Defense Directive 3000.05 PDF 238 KB 01/30/06

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