http://www.azcentral.com/arizonarepublic/news/articles/0128iraq-rebuild0128.html

Reconstruction projects will go unfinished in Iraq

Jonathan Finer Washington Post Jan. 28, 2006 12:00 AM

BAGHDAD - The United States will not complete hundreds of basic water and electricity projects planned after the 2003 invasion because more than $3 billion was shifted to meet unanticipated needs, according to a U.S. government audit of reconstruction spending in Iraq.

Iraqis routinely describe the lack of basic services such as clean water and a steady supply of electricity as perhaps the biggest problem facing the war-ravaged country, ranking it alongside insecurity and persistent insurgent violence.

But with less than 20 percent of the government's $18.4 billion reconstruction budget unallocated, and the Bush administration not planning to seek more such funds in the budget request going before Congress next month, "some of the original goals will not be fully achieved in some sectors," according to the audit released Thursday by the office of the special inspector general for Iraq reconstruction.

"The United States' reconstruction efforts have shown tangible results in improving the Iraqi infrastructure," Inspector General Stuart Bowen Jr. wrote in the report. "However, the significant funding change means that many of the originally planned projects will not be completed."

As much as 60 percent of all projects aimed at improving Iraq's water supply, including work on sewer systems and drinking-water supplies, will remain unfinished because more than $2.1 billion originally allocated to that purpose was shifted away, according to the report.

Projects related to drinking water that were expected to benefit about 8 million people will now benefit about 2.75 million, the report said. And only two of 10 planned sewerage projects will be completed, though they will serve an additional 4.5 million people.

More than 125 of a planned 425 electricity projects will also be left unfinished, a total that reflects a steep reduction in the goal for increasing Iraq's generating capacity. Plans for four gas-powered generating plants and a diesel plant were canceled as officials reallocated about $1.25 billion in funding. "The system is inadequate to meet Iraq's growing demand and lacks any measure of reliability," the report said.

Bowen has referred to the gulf between the aims of U.S. reconstruction officials and what they will be able to accomplish as the "reconstruction gap."

Much of the discrepancy stems from higher-than-expected costs to provide security for projects. The audit said roughly 16 percent to 22 percent of each project's budget went toward security, including providing armored vehicles and trained security teams with communications equipment, 9 percent more than anticipated.