The Associated Press - Problems Continue With Defense Contracts

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By ANDREW TAYLOR The Associated Press

A pair of U.S. senators investigating reports of waste, fraud and mismanagement in defense contracts in Iraq reported from Baghdad Saturday that they see some improvement but the military has a long way to go.

Sens. Claire McCaskill, D-Mo., and Tom Carper, D-Del., were in Iraq meeting with Pentagon officials to discuss reports of waste, fraud and mismanagement in defense contracts.

Uncountable billions of dollars have been squandered, McCaskill said, but there has been improvement in centralizing contracting oversight and increasing the number of fixed-price contracts containing incentives not to pad costs. That's a departure from the early days of the war when reconstruction money and other aid to Iraq was shoveled into the country with little oversight.

She said criminal charges may be filed in some cases and that the government might get at least a little of its money back. But the fact that the security situation in Iraq is so risky makes it difficult to effectively oversee contracting, said Army Auditor General Patrick Fitzgerald, who was joining the senators as they meet with more than a half dozen military inspectors general responsible for auditing services and logistics contracts.

McCaskill, a member of the Senate Armed Services Committee, has been critical of top officials of the military's auditing agencies for overlooking or ignoring reports of contractor mismanagement and overcharging the U.S. government.

"There's no question that in the early days of this conflict, gargantuan, I mean huge mistakes, were made," McCaskill said.

What is more, she added, similar problems were experienced in Kosovo, but the Pentagon didn't seem to learn from those mistakes, she added.

This is the first trip to Iraq for McCaskill, a former Missouri state auditor who narrowly won her Senate seat last year on a campaign that pledged to target government waste.

Earlier this year, McCaskill denounced Defense officials for repeatedly renewing a contract with Houston-based KBR Inc., despite audit reports showing poor management and expansive overcharging. The company was even rewarded with over $200 million in performance bonuses for work well done, she said.

The senators also met with Gen. David Petraeus _ the top U.S. commander in Iraq _ and other top U.S. military officials and diplomats, as well as Iraqi government officials and U.S. troops from Missouri and Delaware.

___ Associated Press Writer Sam Hananel in Washington contributed to this story.

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