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Last Updated: Wednesday, 7 September 2005, 17:08 GMT 18:08 UK
Annan accepts oil-for-food lapses
Kofi Annan

UN Secretary General Kofi Annan has said he takes personal responsibility for the failures of the oil-for-food programme, highlighted in a new report.

The highly critical report by an independent panel was delivered to the UN Security Council on Wednesday.

It finds instances of "illicit, unethical and corrupt" behaviour during the $64bn scheme, and blames the secretary general for mismanagement.

The inquiry concludes that the UN is in urgent need of sweeping reform.

Responding to the report, the US ambassador to the UN, John Bolton, said it demonstrated that the credibility of the UN depended on those reforms.

"This report unambiguously rejects the notion that business as usual at the United Nations is acceptable," he said.

It was a compact with the devil, and the devil had means for manipulating the programme to his ends
Paul Volcker
Head of the inquiry

Mr Annan said the findings were "deeply embarrassing".

"The inquiry committee has ripped away the curtain, and shone a harsh light into the most unsightly corners of the organisation.

"None of us - member states, secretariat, agencies, funds and programmes - can be proud of what it has found."

High-level corruption

The report was prepared by investigators led by the former head of the US Federal Reserve, Paul Volcker.

It faults UN management for allowing former Iraqi leader Saddam Hussein to corrupt the operation for personal gain.

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It says there was no adequate framework of control and auditing. There were incidences of corruption at the highest level as well as in the field.

"Our assignment has been to look for mis- or maladministration in the oil-for-food programme, and for evidence of corruption within the UN organisation, and by contractors. Unhappily we found both," Mr Volcker said.

He said the programme's weaknesses were aggravated by corrupt behaviour, and Iraq had been allowed to take too much initiative.

"It was, as one past member of this council has put it, a compact with the devil, and the devil had means for manipulating the programme to his ends," Mr Volcker said.

He added that the problems were not an aberration but ran deep in the UN, which had been designed 60 years ago in a "simpler time".

Key summit

But the chief investigator said the programme had had some successes, averting the danger of malnutrition and the collapse of medical services in Iraq.

The scheme was set up in the 1990s, when Iraq was under economic sanctions, and allowed the country to sell enough oil to provide food and healthcare for its people.

BBC diplomatic correspondent Jonathan Marcus says Mr Annan has embraced change, establishing a commission that has presented wide-ranging proposals for updating UN machinery and potentially broadening Security Council membership.

World leaders will discuss the issues at a summit ahead of the annual UN General Assembly, in what our correspondent describes as a potentially key moment in the organisation's history.

The report said action should be taken by the time the General Assembly had completed its meetings in 2006.




BBC NEWS: VIDEO AND AUDIO
Hear the inquiry team chairman outline the findings



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