Corruption

Scandal in the Defense Procurement Agency: 23 PR people and inefficient staffing structure

The Defense Procurement Agency (DPA) of the Ministry of Defense of Ukraine is once again at the center of a scandal. A journalist and member of the Public Anti-Corruption Council at the Ministry of Defense, Tetiana Nikolayenko , revealed details of the staffing structure of the Defense Procurement Agency, which, according to her, employs 23 PR specialists, and the total number of administrative staff reaches 19% of the total staff. MP Viktoriia Syumar sent a parliamentary appeal to the Healthcare Agency to inform about the structure of the company and how many people work in each department. However, the pharmaceutical company simply refused to answer the MP. Komersant ukrainskyi has collected all the information known about the scandal at the Defense Procurement Agency.

23 PR people and bureaucracy in the Defense Procurement Agency

Earlier, journalist Tetiana Nikolaienko reported interesting facts about the new structure of the Defense Procurement Agency. For example, the Defense Ministry decided to hire as many as 23 PR specialists in the Strategic Communications Department (8 of them to work with international leaders). At the same time, 13 people worked in the backroom department, and 22 in the contract support department.

This is despite the fact that the agency’s main task is procurement, not communications and PR.

Tetyana Nikolayenko drew attention to the excessive number of PR and administrative staff:

“But I have to point out one thing: after 23 PR people appeared in the Healthcare Agency, communication is becoming more and more complicated. However, we must not forget that the public communications department consists of only 6 people, 8 of whom work on communications on digital platforms. And another 8 communicate with national and international stakeholders. There should be a 23rd person, but this is probably the head.”

She also notes that after criticizing the previous head of the AOZ, Maryna Bezrukova, for having 4 PR people, the new structure under Arsen Zhumadilov has become even more cumbersome. Nikolayenko adds:

“There is also a document management department with 10 people. There is also a department for organizing document flow – 4 people. And the sector of initial review of documents – 2 more people.”

According to her estimates, a total of 53 people, or 19% of the staff, are engaged in administrative and communication functions, including 8 advisors and 2 assistant directors, as well as 4 employees of the information security department.

“Yes, that’s not all – the director has 8 advisors and 2 assistants. And that’s not all – there is also an information security department – 4 more people. There are 53 people in total, which is 19% of the entire staff,” the journalist added.

Nikolayenko asks a rhetorical question:

“Are all these people really needed, probably three protocolists know… These people probably also know why this desk is so similar to the desk of the State Logistics Operator.”

Context of the scandal: The Healthcare Agency does not respond to requests for information about its structure

Viktoriia Syumar sent a deputy’s appeal to the Healthcare Organization to inform her about the structure of the enterprise and how many people work in each department.

However, the Pharmaceutical Industry simply refused to respond to the MP. In response, they gave a legal justification why it was not necessary to respond.

The document signed by the director Arsen Zhumadilov reads:

“In such circumstances, there are no legal grounds for providing information and documents at your MP’s request.”

Syumar notes that the reason for the refusal is formal: they say that the appeal is not an official parliamentary request because it was not read from the rostrum of the Verkhovna Rada. And even though the Rada is not currently working in plenary mode, the answer is still no.

The response also emphasizes:

“The company carries out its activities exclusively within the limits and procedure established by the current legislation…”

Nikolayenko also draws attention to the fact that MP Victoria Syumar did not receive a response to her request for information about the activities of the pharmaceutical company, in particular, about the Shimon plant and its staffing structure. According to the journalist, this is not surprising:

“No, I am not at all surprised that Viktoriia Syumar did not receive a response to her request, neither about the Shimon plant nor even about the staffing structure. This would be a guilty plea. And the Ministry of Defense is not capable of this. It would be shooting itself in the foot. Especially after Bezrukova was imprisoned for 4 PR people in a plainclothes uniform, of whom only one was working.”

Zhumadilov explained some personnel changes in the Defense Industry

Earlier, Arsen Zhumadilov, Director of the Defense Procurement Agency, speaking to Radio Liberty journalists, said that the Strategic Communications Department of the Defense Procurement Agency employs not only people who conduct public communication.

According to the head of the Defense Procurement Agency, the Strategic Communications Department includes not only public communications, but also, for example, the international department, which used to be a separate unit and had 17 people. Therefore, as Zhumadilov noted, the Agency has now optimized and reduced the relevant structural units, bringing them into one department.

“We have combined it within the same logic,” said the Director of the Agency.

And this logic implies that the Agency cannot communicate differently both inside and outside the country, so they created a strategic communications department, where “the total number of people is less than the number of people who performed these functions within the previous staff structure,” Zhumadilov said.

He also noted that people were not laid off, but rather were part of a staff reorganization and were offered to move to other positions. As of now, less than 10 people work in the Strategic Communications Department at the Healthcare Association, Zhumadilov said.

He also commented on the number of people working in the procurement department. According to journalist Tetyana Nikolayenko, there are currently 13 people there.

According to Zhumadilov, the mentioned department is “essentially a tender department”. At the same time, he assured that the total number of people involved in procurement is about a hundred employees.

“If we take all the structural units that are currently engaged in procurement or will be engaged in procurement, including the category management department, the authorized persons department, procurement, contract management, logistics, technical inspection, it is six structural units. The total number of people involved in procurement is about 100,” Zhumadilov said.

“This is not a formality. This is a mechanism to avoid control.”

The draft law, which provides for the closure of information in the registers on all enterprises related to defense, has already caused a public outcry. The Committee on Anti-Corruption Policy has recognized that the document contains corruption risks. According to MP Viktoriia Syumar, billions of hryvnias may be hidden under the guise of defense:

“Transparency is not a threat. It is also a weapon. Especially when it comes to providing weapons to the army. The draft law that would close the information in the registers about all enterprises that are at least related to defense was recognized by the Committee on Anti-Corruption Policy as containing corruption risks. This is not surprising. Billions are often hidden under the guise of “defense”. We know very well that it is not openness that kills. What kills is 100% of subscriptions for non-existent weapons. What kills is silence. What kills is the response instead of answers.”

She believes that the current legal practice is nothing more than an official instruction to ignore inconvenient questions, which is actively used by various authorities.

“But my request will be read out after all. And I will have to answer,” the MP notes, emphasizing that attempts to avoid answering only increase suspicions: either the parliament or the authorities themselves have something to hide.

Why is it important?

During a war, when every penny of the budget must work for victory, spending on a bloated administrative apparatus raises suspicions. Especially if these expenses are accompanied by silence in response to socially important requests.

And even more interesting: Tetiana Nikolaienko notes that the staff of the Anti-Corruption Agency is strangely reminiscent of the staff of the State Logistics Operator.

It should be noted that the National Anti-Corruption Bureau of Ukraine has launched a pre-trial investigation against Defense Minister Rustem Umerov. He is suspected of abuse of power.

This happened after Umerov announced on January 24 that he had decided not to extend the contract with the director of the Defense Procurement Agency, Maryna Bezrukova, for another year.

The AntAC noted that the head of the Defense Ministry “refused to comply with the decision of the Supervisory Board of the Defense Procurement Agency, contrary to the law.” Umerov also dismissed two members of the Supervisory Board, Taras Chmut and Yuriy Dzhyhyr.

Scandal over the appointment of the head of the Defense Procurement Agency

on January 24, Defense Minister Rustem Umerov said that the Defense Ministry would not extend the contract with the director of the Defense Procurement Agency (DPA), Maryna Bezrukova, whose contract was extended for another year by the Supervisory Board of the DPA on January 24.

Arsen Zhumadilov, the current head of the DOT, has already agreed to head the agency. In addition, two representatives of the state, Yuriy Dzhyhyr and Taras Chmut, are to be recalled from the Supervisory Board.

In her turn, Bezrukova said she would remain the head of the Healthcare Agency. She was shocked by the Defense Minister’s statement about the non-renewal of her contract. According to her, “it looks like an attempt to rape all the reforms that were announced and promised to the public.”

Prior to that, the Supervisory Board of the Healthcare Agency approved the extension of Maryna Bezrukova’s contract for another year. According to the agency, no additional approval from the Ministry of Defense is required.

On January 30, the register was amended again, reinstating Bezrukova in her position. Then the registers were changed repeatedly until Zhumadilov again became the interim head of the APH.

The volume of procurement by the Healthcare Agency is about UAH 300 billion a year, while the State Defense Enterprise is about UAH 100 billion.