Lawmakers probe food contract for troops in Afghanistan By Susan Cornwell Posted 2012/05/24 at 1:02 pm EDT WASHINGTON, May 24, 2012 (Reuters) The lawmakers are investigating a billing dispute of at least $750million between the main supplier of food to U.S. troops inAfghanistan and the Pentagon. The Pentagon says Supreme Foodservice GmbH overcharged it, but theNetherlands-headquartered company said the rates were properlybased on the complexities and dangers of supplying food inwar-ravaged Afghanistan. The Republican and Democratic leaders of a House of Representativespanel have written to the company as well as the Pentagon's DefenseLogistics Agency, demanding information and documents within tendays about the dispute on a contract dating to 2005 that so far hascost U.S. taxpayers $5.5 billion. |
The lawmakers' probe comes amid continuing concerns about waste andabuse of tax dollars in Afghanistan, with scrutiny intensifying asthe Pentagon budget faces big cuts. With such a large sum in dispute, lawmakers questioned thePentagon's oversight of the food contract, and also appear worriedthat Supreme could get the business again when an even largerfollow-on contract is awarded this December. The Pentagon has solicited bids for a follow-on contract estimatedat $10 billion to $30 billion over five years, although U.S. combattroops are expected to leave Afghanistan by the end of 2014. "The American taxpayers refuse to accept a government contractorthat bills more than $750 million in unsubstantiated charges, andthey refuse to accept the Pentagon's failure to manage thiscontract properly," Representative John Tierney said in astatement.
"It is outrageous that DLA could ever be in the position ofpossibly overpaying any vendor by three quarters of a billiondollars - especially at a time when troop levels are being scaledback, because funding is tight," Representative Jason Chaffetzsaid. Chaffetz, a Republican, is the chairman and Tierney the topDemocrat on a House Oversight and Government Reform subcommitteethat deals with foreign operations. "The subcommittee will work with the Department of Defense toinvestigate the facts and circumstances surrounding this apparentlack of oversight," Chaffetz said. Supreme Group said in a statement that it will respond to thelawmakers' letter promptly. A spokesman for the Defense LogisticsAgency, Douglas Ide, said the agency was reviewing the request forinformation.
REFUND DEMANDED LAST DECEMBER The Defense Logistics Agency wrote to Supreme last December to sayit had overpaid the company, and demanded a refund of $756.9million. But Supreme has argued that food deliveries should bebased on market rates for transportation in the remote war zone,according to Chaffetz and Tierney. "Calculated this way, Supreme would be owed ... $1.08 billion morethan DLA has already paid," Chaffetz and Tierney said in letterssent Wednesday seeking information from the Pentagon and Supreme'soperations in Switzerland and Dubai.
"Despite a billing dispute as wide as $1.64 billion, DLA is nowpreparing to grant a five-year follow-on contract that will beworth $10 to $30 billion," the lawmakers added. "Supreme remainsone of the four contractors under consideration." The original contract with Supreme was signed in 2005 to supplyfood to just four sites in Afghanistan. This was quickly expandedto 68 sites and today there are 265 sites. But Tierney and Chaffetz say there was never an agreement onpricing terms for transportation to the additional sites, many ofwhich were in remote parts of Afghanistan.
The contract was renewedin December 2010, and expires this December. The lawmakers' staffs wonder why the follow-on contract is expectedto be even larger. "It raises a lot of questions given ourpotential (troop) footprint," one congressional aide told Reuters."We asked the DLA, and didn't get an answer." In its statement, Supreme Group said the Defense Logistics Agencyhad unilaterally reduced its payments by $21.7 million a monthbeginning in March to try to recoup disputed funds. "We are confident that in due course a satisfactory resolution willbe reached," Supreme Group said, adding that in the meantime, "Weremain focused on provision of support to the war fighters in somevery challenging environments." Pentagon Inspector General Gordon Heddell told lawmakers last yearthat the Supreme contract was "an example of just how bad it canget," saying it had not been well designed. The overpayments included $98 million in transportation costs,Heddell said in testimony.
He said the United States also paid $455million in services to airlift fruit and vegetables intoAfghanistan, without including that in the contract. The Commission on Wartime Contracting in Iraq and Afghanistan, abipartisan group set up in 2008 to study contracting, said lastAugust that at least $31 billion had been wasted on contracts andgrants in Iraq and Afghanistan. (Editing by Vicki Allen).
The e-commerce company in China offers quality products such as JWH Research Chemicals , Organic Compound Synthesis Manufacturer, and more. For more , please visit Pharma Raw Material today!
Related Articles -
JWH Research Chemicals, Organic Compound Synthesis Manufacturer,