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Last Updated:  Wednesday, 26 February, 2003, 22:23 GMT
Firms seek elusive security bonanza

By Steve Schifferes
BBC News Online in Washington

Airport security scanner
Who will profit from more security?
Defence contractors and small specialist firms have been gathering in Washington to discuss how to access the huge new funds that will soon become available from the new Department of Homeland Security (DHS).

Hundreds of company executives from across the United States have been taking part in a Defense Week conference aimed at speeding up the process of procurement.

With a $58bn budget, 22 Federal agencies, and 170,000 employees, the creation of the new department "is the most significant bureaucratic transformation since the formation of the Pentagon 50 years ago," according to Bruce Aitken, president of the Homeland Securities Industries Association, a recently formed industry lobby group.

There has been a convergence of patriotism and capitalism
Ray Biagini, Washington lawyer
But Mr Aitken says that administrative delays in creating the organisation, and the hold-up in Congress over allocating funds for the 2003 Budget, have meant that very little fresh funding has been available so far.


Spending on homeland security covers a wide range of services, from airport security to detection of biological and chemical agents, to prevention of hackers accessing government websites.

Among the agencies joining the new department are the Coast Guard, the Secret Service, Customs, and the Immigration Service.

With the department's budget rising by 64% this year, "there has been a convergence of patriotism and capitalism," according to Ray Biagini of the law firm McKenna, Long & Aldridge, who helped draft the legislation giving companies some legal protection against lawsuits if a terror attack did occur.

But many companies have not just been deterred by the fear of being sued.

Big players

They fear that the large defence companies, like Boeing, Lockheed Martin, and Raytheon, will dominate the homeland security market, just as they dominate the $400bn Department of Defence acquisition process.

William Menzies develops biodefense detection devices for the Midwest Research Institute in Kansas City, Missouri.

He says he has had trouble reaching key officials in the new department, where there is still not a head of procurement.

Mr Aitken says that a key official in the Homeland Security Department has assured him that new contracts will be shared among "teams".

However, Helaine Elderkin, a lawyer with the Computer Sciences Corporation, says that it could take years if not decades to merge the disparate agencies into a coherent department.

She warned that some previous attempts to coordinate Federal emergency programmes failed because of "ineffective and indifferent leadership."


The problem for the government, and the industry, is that organising homeland security is taking far longer - and costing far more - than anyone thought after 11 September, 2001.

And even with all the new spending, the states still say that they have not received enough money for basic needs, such as protective gear for police and firemen in the event of chemical or biological incidents.

Meanwhile, while the threat of terrorist incidents has increased sharply with the approach of an Iraq war, much remains to be done.

Although the government has taken over airport security, very few containers are inspected at ports, and the industry believes there are gaps in IT security as well.

It is now treading a delicate line in pointing out the dangers of delay, while not appearing too eager to gain its share of new business.

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