US lawmakers offended by spike in Afghan guards' cost
* Afghan government requiring USAID projects to switch to Afghan security
* Kabul adding 20 percent "profit" on costs of Afghan guards
By Susan Cornwell
WASHINGTON, March 29 (Reuters) - U.S. lawmakers were disturbed on Thursday by a government auditor's prediction that security costs will spike for U.S. development projects in Afghanistan as they are forced to switch from private contractors to Afghan government-provided security.
Representative John Tierney suggested the United States might want to just walk away from aid projects in Afghanistan rather than pay the additional costs, including a 20-percent "profit" charge, under the new policy mandated by Afghan President Hamid Karzai. Tierney said there were already too many questions about "where the money is going" in Afghanistan.
"There's always one last option. Just don't do it," Tierney, a Democrat, told a s enior o fficial of the U.S. Agency for International Development (USAID), Alex Thier, in a hearing on Capitol Hill.
"Personally, I'm offended ... I think we are being pushed around," said Representative Jason Chaffetz, a Republican. "We're paying for everything, we should be able to provide the security."
The hearing also aired disputes among U.S. agencies over whether security costs will indeed go up, and whether that will force closure of some U.S.-funded development projects.
Preliminary findings of the audit by the Acting Special Inspector General for Afghanistan Reconstruction, Steven Trent, said security for USAID projects may cost as much as 46 percent more than it does now under the new system mandated by Karzai, adding as much as $55.2 million to USAID's bill in the first year of the transition.
Private security contractors working for foreign companies, who have numbered in the thousands, are no longer allowed to guard development programs in Afghanistan under Karzai's decree. If these programs want armed escorts or guards for their compounds, they are supposed to contract with a branch of the Afghan police, the Afghan Public Protection Force (APPF).
The deadline for the change was March 20, but the Afghan government has granted 30- to 90-day extensions for projects that have not yet made the transition.
Karzai has long been critical of private contractors. But the changeover is also a gauge of plans to hand n ationwide re sponsibility for security to the Afghan army and police. The United States and other western nations plan to withdraw most of their troops by the end of 2014.
USAID's Kabul mission director S. Ken Yamashita has angrily rejected Trent's findings, calling them "inaccurate" and "speculative" in a letter to the inspector general.
AFGHAN GOVERNMENT ADDING 20 PERCENT "PROFIT" CHARGE
Thier, the director of USAID's Washington office of Afghanistan and Pakistan affairs, downplayed the findings at Thursday's hearing, but acknowledged costs would go up.
"We see a 16 percent cost increase. I can't guarantee that some projects won't be more and some less," Thier told a subcommittee of the House Oversight and Government Reform Committee.
The potential costs include a 20 percent "profit" that the Afghan government will apply to most charges associated with each guard in the new Afghan Public Protection Force, Trent said in his testimony to the subcommittee.
Trent also said aid projects might actually increase the use of expatriate security consultants under the new system, perhaps doubling those costs. Projects will be allowed to hire licensed expatriates to "advise" on security, although the actual guard duty is required to be done by the APPF.
Trent said at least 10 USAID projects with a total award value of $899 million were at risk of termination because of the costs.
But Thier said that no USAID projects had been shut down because of the change. He added that there were no indications of any decrease in security for the USAID projects, in part because most of the security was provided by Afghans anyway.
The guards "change their uniforms ... and go to work for APPF," Thier said.
Chaffetz countered: "Why are we going to spend more for the same thing?"
USAID has about 380 employees in Afghanistan, but also funds many projects that are carried out by non-governmental organizations and the Afghan government.
In his report, Trent described some of the additional fees that the Afghan government planned.
The monthly fee for an Afghan guard will be $100, the report said. "APPF will add charges for firearms, ammunition, training, administrative and overhead fees, and a profit, among other charges, to the monthly fee," it said.
"Furthermore an annual charge of $600 (or $50 a month) per guard will be assessed for uniforms and personal equipment," it said. "In addition, although APPF is a state-owned enterprise, a profit of 20 percent will be applied to all charges associated with a guard, except for uniform and pension charges."
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