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. Last Updated: 07/27/2016

Wasteful Arms Spending Under Fire

SukhoiThis year Russia will spend $15.4 billion on maintenance and buying new arms, such as modernized Sukhoi 27SM fighters.
Even as it pours money into arms procurement and maintenance, the government will crack down on waste in defense spending, a senior government official said Wednesday.

Among the measures are uniform procurement tenders for all defense and security agencies and an audit of prices for major weapons systems, Vladislav Putilin, head of the Economic Development and Trade Ministry's defense programs department, said at a briefing.

This year Russia will spend 432 billion rubles ($15.4 billion) on the maintenance and equipping of its military and security forces, or 30 percent more than in 2004, Putilin said.

"The main difference in the 2005 defense budget is that it introduces new tough requirements to improve efficiency in spending," he said.

While maintenance spending still remains the major component of budget allocations, Putilin said, nearly half, or 201 billion rubles, will go directly to arms procurement and research and development.

For the first time in the post-Soviet period, the government's overall spending on arms this year is set to exceed Russia's weapons exports, which last year reached a record $5.6 billion.

Although defense spending has been continuously rising for the past five years, the military has had little to show in terms of actual arms purchasing.

President Vladimir Putin has repeatedly asked Defense Minister Sergei Ivanov to account for wastefulness in arms spending.

This year the government seems to have taken home the criticism and is adopting a number of measures to ensure better control of procurement spending.

In the past, the different armed services issued their own tenders for new weapons, leading to huge price discrepancies for the same products.

"If they buy buckwheat then it should be for all of the military -- not each buying his own sack," Putilin said. "If it is a machine gun and there are many customers, it should be a single tender."

In the first half of the year the government will hire an independent auditor to value prices for major weapons systems, he said. Equipment procured thereafter will be bought at fixed prices.

"We often end up with [products] costing 30 to 40 to 50 percent more and receive fewer items ... The current budget prohibits prices other than those established in the tender," Putilin said.

The range of military products for procurement will also be streamlined to avoid the acquisition of similar weapons systems.

Of the 201 billion rubles the government is spending on new arms and R&D, 44 percent will go toward actual procurement, 22 percent toward repairs and upgrade works and 34 percent toward research and development of new weapons systems.

Last month Defense Minister Sergei Ivanov already revealed that his wish list for 2005 included 91 T-90 battle tanks, one squad of Iskander-M missile launchers, two warships, seven modernized Su-27SM fighters and nine defense satellites.

Konstantin Makienko, deputy head of the Center for Analysis of Strategies and Technologies, endorsed the government's efforts to cut waste.

"The measures being proposed by the government are worthy enough," he said. "It's better late than never."