UNITED NATIONS, New York Secretary General Kofi Annan and the members of the Security Council received an 860-page report on Wednesday excoriating their management of the oil-for-food program and saying the United Nations must be extensively overhauled if it is to earn global credibility and meet its 21st-century obligations.
“The organization requires stronger executive leadership, thoroughgoing administrative reform and more reliable controls and auditing,” said the report, compiled by a committee led by Paul Volcker, a former chairman of the Federal Reserve.
“At stake is the United Nations’ ability to respond promptly and effectively to the responsibilities thrust upon it by the realities of a turbulent, and often violent, world,” said the report, the result of a yearlong, $34 million investigation.
“In the last analysis,” it said, “that ability rests upon the organization’s credibility – on maintaining a widely held perception among member states and their populations of its competence, honesty and accountability.”
Addressing the Security Council on Wednesday in a special session at which Volcker presented the report, Annan said that while it was “painful for all of us” he accepted the personal criticism of him and would act urgently on the need for reforming the world organization.
“The findings in today’s report must be deeply embarrassing to us all,” he said. “The inquiry committee has ripped away the curtain, and shone a harsh light into them most unsightly corners of our organization.
He asked, “Who among us can now claim that UN management is not a problem, or is not in need of reform ?”
The four volume report examined in detail the history, conduct and unraveling of the $64 billion oil-for-food program in Iraq and said that the faults found were representative of the United Nations as a whole.
It made hundreds of recommendations for tightening up financial and management practices to make the United Nations accountable, transparent and efficient.
It faulted Annan for not curbing the corruption and mismanagement in the program, but said it had found no evidence to support charges that he influenced a contract awarded to Cotecna Inspection Services, the Swiss company where his son, Kojo Annan, had worked.
It rejected claims in a memo that surfaced this June by an executive of the company that he had had conversations with the secretary general in Paris in 1998 at which the contract was discussed. The committee said it investigated the claim and interviewed all the principals and ended up believing that the executive, Michael Wilson, was “bluffing” to make himself seem important. The extent of their meeting, the committee said, was a “hello” shouted across a hotel corridor.
It said that the secretary general should been more diligent in investigating the activities of his son and the possibilities of conflict of interest that it posed.
The committee said it found no evidence that Kofi Annan knew about the contract but did find instances where Kojo Annan tried to influence it with calls to the UN procurement office. It said too that Kojo Annan exploited his father’s name without his father knowing it.
In one incident, the report reveals, Kojo Annan bought a Mercedes limousine using his father’s name, which yielded him a 15 percent diplomatic discount and enabled him to import the vehicle to Ghana without paying import duty. In all, he saved $20,644, the committee said.
The oil-for-food program scandal has deeply undermined the reputation of Annan, once thought of as the most outstanding secretary general since Dag Hammarskjold, and brought calls from Republican lawmakers in Washington for his resignation. Annan’s spokesman, StÃ©phane Dujarric, said Tuesday that the secretary general intended to serve out his term, which runs until the end of 2006.
The committee credited the program with “important successes” despite the abuses and corruption that it generated. The report noted that the program had helped to keep in place the sanctions that deprived Saddam Hussein of the ability to acquire or develop weapons of mass destruction, and that, thanks to the food and medicine that got to the 27 million Iraqis, “minimal standards of nutrition and health were maintained in the face of potential crisis.”
It said that these successes were achieved “despite uncertain, wavering direction from the Security Council, pressures from competing political forces in Iraq and endemic corruption on the ground.”
However, it said, the structuring of the program gave too much leeway to the Iraqi regime and dangerously divided power between the Security Council and the secretariat, which shared responsibilities for running it.
“That turned out to be a recipe for the dilution of secretariat authority and evasion of personal responsibility at all levels.”
It said that the program’s instances of corruption, its easy exploitation by Saddam and its cutthroat national rivalries ended up discrediting the United Nations.
“As a result, serious questions have emerged about the United Nations’ ability to live up to its ideals,” it said.