Ukraine’s parliament, the Verkhovna Rada, has passed a long-awaited bill on state defense procurement, which is expected to help end the endemic corruption and ineffectiveness in the military sector.
The draft law, which went through 430 amendments, received the votes of 276 lawmakers in its final reading on July 17.
According to the lawmakers, the new legislation is meant to ensure more effective usage of state budget funds appropriated for the procurement of goods and services for national security and defense purposes. It will enforce transparency in planning and procurement.
The bill sparked a major battle in parliament. The final text is the result of painful compromises in the government and the Rada. Still, it was immediately hailed as a major accomplishment by anti-graft watchdogs and reform advocates.
Mustafa Nayyem, deputy director of state defense production giant UkrOboronProm, called the law “a revolution on paper.”
The Center for Defense Strategies, a Kyiv-based think tank set up by former Defense Minister Andriy Zagorodnuyk, called the final approval “a historic event,” adding that the new bill wound completely replace the old system of procurement, which was the cause of immense corruption and ineffectiveness in the indutry.
“(That) illustrates the scale of changes that are becoming inevitable is the transition from non-public procurement processes to market relations,” the press service of the organization stated on July 17.
In particular, the new bill aims to get rid of old, Soviet-style procurement, which was prone to multimillion-dollar corrupt schemes under the disguise of state secrecy.
Instead of that, the law defines a transparent unified procedure of procurement similar to what is practiced in many NATO member nations. Also, it provides clear regulations about how to make contracts with foreign entities when purchasing items that are unavailable on Ukraine’s domestic market. That said, the law gives preference to Ukrainian manufacturers in defense acquisition tenders.
Nonetheless, as many as 26 various statutory instruments need to be amended or developed from scratch so that the new legislative framework can start working.
The National Anti-Corruption Defense Committee, a Kyiv-based anti-graft watchdog that was involved in the bill’s development, also had a generally positive response to the legislation’s final version.
“At the same time, there remains a scope of work to be done,” the organization stated.
“This is about the declassification of information regarding the amount of financing of contracts signed under (the old legislation). It should have been done by an interdepartmental commission that would have reviewed all accomplished contracts within six months to define what could be declassified without any harm to national security,” the statement reads.
“Unfortunately, the 6-month deadline was excluded from the bill’s text, which calls into question the execution of this regulation.”
