Contractors Watching Contractors

The Special Inspector General for Afghanistan Reconstruction (SIGAR)
has hired a private corporation to help prepare government reports for
Congress about US government contracts with other corporations in
Afghanistan. The massive consulting firm Deloitte and Touche was hired
on a one year contract signed with the US Army's Contracting Center of
Excellence in May for $3.7 million. In the end, the contract could be
worth up to $7.5 million, according to federal contract data reviewed by
The Nation. In 2008, former Republican Congressman Tom Davis was
hired by Deloitte as a Director. Davis once chaired the powerful House
Government Reform Committee.

As part of its work for SIGAR, according to contracts obtained by
The Nation, the firm helps prepare the agency's quarterly reports
to Congress, assists in preparing Congressional testimony for agency
officials and helps develop SIGAR's responses to "questions for the
record" from lawmakers.

SIGAR hired Deloitte "as an interim measure while we, as a new
organization, built the internal capability we needed to provide the
quality reports that the Congress requires," SIGAR spokesperson Susan
Phalen told The Nation. "The SIGAR Quarterly Reports require an
extraordinary amount of detail and attention." Phalen downplayed
Deloitte's role in preparing Congressional reports, saying they "have
assisted the SIGAR staff on certain sections of the Quarterly Reports."

Deloitte also plays a similar role for several other federal
agencies, including preparing reports for the Special Inspector General
for the Troubled Asset Relief Program. TARP was created by the Emergency
Economic Stabilization Act of 2008 and allows the US Treasury Department
to purchase or insure up to $700 billion of "troubled assets." Deloitte
also works in a similar capacity for the US Agency for International
Development and the Special Inspector General for Iraq Reconstruction.

Danielle Brian, the executive director of the non-partisan Project
on Government Oversight sees a direct relationship between Deloitte's
increasingly prominent oversight role within the US government and the
hiring of former Congressman Davis. "We saw an immediate growth in
Deloitte's contracts for oversight functions, especially for special
inspectors general, when Davis left the Congress to go work for
Deloitte," said Brian. "It's totally predictable. This is the kind of
thing that he was encouraging while he was in the Congress. I think this
is a real degradation of government." She said Davis's work with
Deloitte is the "definition of the revolving door."

SIGAR has come under fire recently from a bipartisan group of
senators who have called on President Obama to "commence a comprehensive
review" of the agency. "In light of the planned increase in the U.S.
presence in Afghanistan, we have serious concerns that SIGAR currently
may be unable to perform its mission at a time when the need for
aggressive, independent oversight is greater than ever," wrote Democrat
Claire McCaskill and Republicans Susan Collins and Tom Coburn on
December 8 to President Obama. The lawmakers specifically said that
SIGAR has had "significant, ongoing difficulty in recruiting adequate,
qualified staff."

The senators also criticized the agency for not fulfilling its role
of focusing on "reconstruction contracting," instead conducting reviews
of female participation in the Afghan elections, which the senators said
is not SIGAR's job. The senators also decried what they called "the lack
of audit and investigative reports," pointing out that only "one of the
eight audits performed was a contract audit."

According to a "Performance Work Statement" for Deloitte's contract,
obtained by The Nation, Deloitte "shall provide all personnel,
equipment, tools, materials, supervision, and other items and
non-personal services necessary to perform data collection, data
analysis, report design, report formation and project management support
to ensure timely publication of the quarterly report to be distributed
to Congress...to track the status and maintain accountability of
specific funds allocated/designated for the reconstruction of
AFGHANISTAN, and to determine how the funds have been spent."

The firm, according to the work statement, is also responsible for
"Tracking the oversight activities (Audits and Investigations) of other
Government agencies having oversight authority of the relief and
reconstruction effort in Afghanistan." The contract specifies that
Deloitte personnel must have been granted a "SECRET security clearance
or an Interim Secret clearance from the Defense Industrial Security
Clearance Office."

"Now we have contractors overseeing the oversight of contractors,"
said a government oversight official. "It's like a bad '80s movie."
Tourang Nazari, a spokesperson for Deloitte, when asked for comment on
the firm's work for SIGAR told The Nation, "We do not comment on
work we do for clients."

Despite descriptions in the Deloitte contract, SIGAR's Phalen denied
that Deloitte plays a central role in SIGAR's communications to
Congress, saying "SIGAR staff is fully responsible for the writing and
final editing of all SIGAR reports," adding that Deloitte "contractors
have assisted SIGAR staff, on a interim basis [and it] is limited to
graphics production and the drafting of specific sections of the
Quarterly Reports." She said all audits and investigative reports are
done by official SIGAR investigators. POGO's Brian, however,
contradicted that. "They're actually writing the copy," she said. "To me
the most pure example of what a government person should be doing is
communicating between an inspector general and the Congress. The idea
you hire an outside contractor to do that is, to me, obscene."

SIGAR was created by President George W. Bush, who appointed its current
head, Marine Major General Arnold Fields, in June 2008. SIGAR has thirty
auditors in Afghanistan and the United States. Its budget of $23 million
seems stunningly low given the extent of government contracting in
Afghanistan. According to federal records, the US paid some $6.7 billion
to contractors for work in Afghanistan in 2008. That figure does not
include contracts in Pakistan over which SIGAR has no official mandate.
More than $5 billion has been allocated for Afghanistan reconstruction
in the Supplemental Appropriation of 2009. Meanwhile, according to the
most recent Department of Defense census, there are more than 104,000
private contractors on the US government payroll in Afghanistan, a
number that is expected to grow as US troop numbers swell.