[Senate Hearing 110-1016]
[From the U.S. Government Publishing Office]
S. Hrg. 110-1016
AN UNEASY RELATIONSHIP: U.S. RELIANCE
ON PRIVATE SECURITY FIRMS IN
OVERSEAS OPERATIONS
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HEARING
before the
COMMITTEE ON
HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
UNITED STATES SENATE
ONE HUNDRED TENTH CONGRESS
SECOND SESSION
__________
FEBRUARY 27, 2008
__________
Available via http://www.access.gpo.gov/congress/senate
Printed for the use of the
Committee on Homeland Security and Governmental Affairs
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COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
JOSEPH I. LIEBERMAN, Connecticut, Chairman
CARL LEVIN, Michigan SUSAN M. COLLINS, Maine
DANIEL K. AKAKA, Hawaii TED STEVENS, Alaska
THOMAS R. CARPER, Delaware GEORGE V. VOINOVICH, Ohio
MARK L. PRYOR, Arkansas NORM COLEMAN, Minnesota
MARY L. LANDRIEU, Louisiana TOM COBURN, Oklahoma
BARACK OBAMA, Illinois PETE V. DOMENICI, New Mexico
CLAIRE McCASKILL, Missouri JOHN WARNER, Virginia
JON TESTER, Montana JOHN E. SUNUNU, New Hampshire
Michael L. Alexander, Staff Director
Troy H. Cribb, Counsel
Brandon L. Milhorn, Minority Staff Director and Chief Counsel
Richard A. Beutel, Minority Professional Staff Member
Trina Driessnack Tyrer, Chief Clerk
Patricia R. Hogan, Publications Clerk and GPO Detailee
Laura W. Kilbride, Hearing Clerk
C O N T E N T S
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Opening statements:
Page
Senator Lieberman............................................ 1
Senator Collins.............................................. 3
Senator Tester............................................... 23
Senator McCaskill............................................ 25
Senator Akaka................................................ 27
WITNESSES
Wednesday, February 27, 2008
Hon. Patrick F. Kennedy, Under Secretary for Management, Bureau
of Management, U.S. Department of State........................ 5
Hon. P. Jackson Bell, Deputy Under Secretary of Defense,
Logistics and Materiel Readiness, U.S. Department of Defense... 9
James D. Schmitt, Senior Vice President, ArmorGroup North
America, Inc................................................... 12
Laura A. Dickinson, Professor, University of Connecticut School
of Law......................................................... 16
Alphabetical List of Witnesses
Bell, P. Jackson:
Testimony.................................................... 9
Prepared statement........................................... 45
Dickinson, Laura A.:
Testimony.................................................... 16
Prepared statement........................................... 60
Kennedy, Patrick F.:
Testimony.................................................... 5
Prepared statement........................................... 39
Schmitt, James D.:
Testimony.................................................... 12
Prepared statement........................................... 52
APPENDIX
Questions and Responses for the Record from:
Mr. Kennedy.................................................. 76
Mr. Bell..................................................... 122
Mr. Schmitt.................................................. 149
Ms. Dickinson................................................ 158
AN UNEASY RELATIONSHIP: U.S. RELIANCE
ON PRIVATE SECURITY FIRMS IN
OVERSEAS OPERATIONS
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WEDNESDAY, FEBRUARY 27, 2008
U.S. Senate,
Committee on Homeland Security and
Governmental Affairs,
Washington, DC.
The Committee met, pursuant to notice, at 10:02 a.m., in
Room SD-342, Dirksen Senate Office Building, Hon. Joseph I.
Lieberman, Chairman of the Committee, presiding.
Present: Senators Lieberman, Akaka, Carper, McCaskill,
Tester, Collins, and Sununu.
OPENING STATEMENT OF CHAIRMAN LIEBERMAN
Chairman Lieberman. The hearing will come to order. Thank
you all for being here.
Throughout our history, the American military has relied on
the private sector in what has been called a ``great arsenal of
democracy'' to provide weapons and supplies for our fighting
forces. But once the private sector delivered the goods,
generally speaking its responsibility ended.
Over the past 15 years, we have seen a significant
expansion of the role of private firms in overseas operations
from being the manufacturers of military supplies and equipment
to becoming suppliers of crucial military services, like the
logistical support of our troops, the training of foreign
police and armies, the conduct of interrogations, and the
provision of armed security details.
It is the latter--the use of private security contractors
(PSCs)--that is the subject of today's hearing because of
questions that have been raised about the use of private
security contractors in the ongoing conflicts in Iraq and
Afghanistan.
Traditionally, bearing arms and employing force in arenas
of military conflict have been the sole province of the armed
services. But our present military is just not large enough to
fulfill the need for the protection of American personnel,
convoys, key facilities, and reconstruction projects.
So the use of PSCs has become necessary in Iraq and
Afghanistan. PSC employees have, in fact, performed
effectively, honorably, and in many instances, heroically. Many
of the PSC employees are ex-service members. They are patriots
who are deeply dedicated to the U.S. mission and ready every
day to risk their lives--and sometimes lose them--protecting
American personnel and America's cause.
We all remember in this regard the horrific sight of the
bodies of those four Blackwater contractors, private security
contractors, being dragged through the streets of Fallujah in
2004.
But there have also, of course, been problems with the
private security contractors. The rapid growth in their use has
been ad hoc and without a comprehensive framework for the
hiring, training, vetting, or even use of their services.
Insufficient oversight of PSCs has drawn strong criticism
from within our government and our military itself, including
Defense Secretary Robert Gates, who said in October that the
mission of many contractors was ``at cross purposes to our
larger mission in Iraq.''
A special panel convened by Secretary of State Condoleezza
Rice to look at PSCs--directed by Under Secretary Patrick
Kennedy, who is one of our witnesses today--concluded that PSCs
``operate in an overall environment that is chaotic,
unsupervised, deficient in oversight and accountability, and
poorly coordinated.'' Those are tough words that need to be
taken seriously by us.
These concerns are reinforced, of course, by incidents like
the September 16, 2007, shooting incident in Baghdad involving
Blackwater security agents in which 17 Iraqis died. Incidents
like that one have exposed gaps in our own laws that leave our
government with limited ability to prosecute employees of
Federal contractors who may have committed criminal acts
abroad.
The House of Representatives, in fact, has passed
legislation to address these gaps, and I understand that
Senators Leahy, Obama, and others are currently working to
bring a similar bill to the Senate floor.
But beyond changing the laws so we can punish criminal
behavior when it occurs--which, again, I stress, are a minority
of cases--we also need to have a discussion about our rapidly
growing reliance on PSCs with the goal of developing a better
framework across our government for deciding how and where we
are going to use them.
Our Committee staff has conducted an extensive
investigation into the use of PSCs in Iraq and Afghanistan that
leads to the following findings:
First, there are no government-wide standards for the
hiring, vetting, and training of PSCs.
Second, oversight of PSCs has been hobbled by
jurisdictional squabbles between the State Department and the
Department of Defense (DOD), as well as insufficient numbers of
personnel from both departments in theater to supervise the
contractors.
Third, reconstruction companies, non-governmental
organizations (NGOs), and other kinds of non-governmental
entities also employ armed security contractors--many of them
third-party nationals--further complicating the creation of a
uniform framework for security services.
And, fourth, Federal agencies are doing very little to
assess our future needs for PSCs or entering into a process to
decide by some rational standards which functions must remain
governmental and which can be contracted out.
That has led our staff to make some recommendations to us
for consideration, for instance: To give consideration to
creating a licensing authority for security companies and their
employees; to set training standards on everything from the
proper use of weapons to the application of international human
rights laws; better coordination among agencies to oversee
PSCs; and to create a clear chain of command when multiple
agencies are involved in an operation. And, again, the
fundamental question that has to be answered--and it seems to
us is not now answered--is what kind of missions private
security contractors should be hired for in the first place.
In December 2007, the Department of Defense and the
Department of State took a first step by signing a Memorandum
of Agreement (MOA) to commit to the development of common
standards for management of PSCs in Iraq and to clarify their
respective roles.
But this only applies to Iraq and only applies to the
Departments of State and Defense, not to other potential fields
of battle or to other agencies such as the U.S. Agency for
International Development (USAID) and the Department of
Justice, which also are involved in the retention of private
security contractors.
The need for standards and regulations on the use of PSCs
goes far beyond today's missions in Iraq and Afghanistan. For
instance, peacekeeping and stabilization, I believe, will be a
major focus of the new Africa Command (AFRICOM) at the
Department of Defense. The State Department is currently
bidding a private contract worth approximately $1 billion to
train peacekeepers and provide logistics for use in Africa.
So, we have to assume that in the normal course the need
for PSCs in the Federal Government is only going to grow, and I
think we have to determine together, Congress and the Executive
Branch, where that growth is necessary and where it is
reasonable. And we have to put in place clear rules for their
hiring of PSCs, and then, I hope, comprehensive systems to
ensure proper training, vetting, and accountability of their
employees.
I thank our staff for the good work they have done
preparing for this hearing. I thank our witnesses for being
here. And now I would call on the Ranking Member of the
Committee, Senator Collins.
OPENING STATEMENT OF SENATOR COLLINS
Senator Collins. Thank you, Mr. Chairman. This is a very
interesting and important subject, and I appreciate your
decision to focus the Committee's efforts on it.
Over the past two decades, the end strength of the U.S.
military has declined by a third, from 3.3 million in 1987 to
2.2 million today.
That dramatic post-Cold War decline has imposed enormous
strains on our troops and caused some unintended consequences
as America undertook large-scale military operations in
Afghanistan and Iraq.
As the Government Accountability Office (GAO) recently
concluded, the decline in force strength, coupled with the
demands of overseas deployments, has greatly increased the
demand for private contractors, including private security
firms.
When thousands of contract security employees are involved
in guarding facilities and escorting convoys in a hostile zone
and face a high risk of violent incidents, we confront a
fundamental question: Should private contractors be responsible
for jobs in a combat zone that have traditionally been
performed by military personnel? Where should the line be drawn
between inherently governmental military operations and
contract services?
There are, of course, many valid reasons to employ
contractors to carry out or augment overseas tasks. But as the
Congressional Research Service has pointed out, never before
have private sector employees played such an extensive role in
a combat zone.
Furthermore, the heavy reliance on contractors without
effective acquisition policies and contract oversight has led
in some cases to wasteful spending, unsatisfactory performance,
and failure to achieve mission objectives. When the Departments
of State and Defense, USAID, or other agencies hire firms that
place armed civilians in foreign countries, their actions can
also have a significant impact on America's foreign policy
objectives.
It is also true that private security firms are providing
valuable services in hostile settings overseas, especially at a
time when our military forces are stretched so thin. They guard
vital infrastructure, protect American and foreign officials,
and escort convoys. Their employees, as the Chairman pointed
out, are often highly skilled, disciplined, and honorable
professionals, typically with extensive military experience.
Nevertheless, the actions of some contract employees,
combined with legally tenuous or ambiguous accountability
mechanisms, have tarnished the industry.
A team of Justice Department prosecutors and the FBI are
currently in Baghdad on a 2-week mission to interview local
witnesses to the September 2007 incident in which Blackwater
private security guards under contract to the State Department
opened fire in a public square. Seventeen Iraqi civilians died,
and others were wounded.
Now, the facts of this incident remain to be determined,
but they raise a broader issue about the lingering uncertainty
about whether these security guards are subject to any legal
accountability. And that degree of uncertainty should not be
acceptable at this stage in the war. And the degree of
accountability should not hinge, as it appears to do today,
upon whether the contractor was supporting a Defense Department
mission or acting on behalf of the State Department.
The problem is not new. In recent years, several
contractors implicated in violence have simply left the area to
avoid any legal consequences.
These examples underscore a stark truth: The United States
cannot expect trust and respect from other peoples if we cannot
impose clear constraints and enforce serious legal consequences
for illegal conduct by private security contractors.
Improving private security performance and protecting
Federal interests demand explicit expectations, precise
contract requirements, sharp oversight, clear standards for the
use of force, and a framework for ensuring legal
accountability.
Our hearing today will raise many difficult questions, and
it is evident that we need better answers than we seem to have
today. Devising an effective set of answers must also include
improving our Nation's ability to recruit, train, and retain a
skilled Federal acquisition workforce.
Our acquisition workforce must not only be strengthened,
but be able to apply its skills in a war zone. And that is why
the Chairman and I have worked very hard to include provisions
in our contracting reform bill that will strengthen our Federal
acquisition workforce and create a Contingency Contracting
Corps that could be marshalled to deploy experienced
acquisition professionals in hostile settings such as Iraq and
Afghanistan.
The rule of law, our obligations to other governments and
to non-combatants, our responsibilities to taxpayers, and our
interest in the success of our foreign policy all suggest that
we need to ask fundamental questions about the role of private
security firms in a war zone. We need to improve the regulation
and oversight of these firms when they are used, and most of
all, we need to ensure accountability. Thank you, Mr. Chairman.
Chairman Lieberman. Thank you, Senator Collins, for an
excellent opening statement, and you raise some very important
questions.
I welcome Senator Tester and Senator Sununu to the hearing
this morning.
We will proceed now with the witnesses. I believe we are
going to give each of you 10 minutes. I appreciate that you are
here. I think you are exactly the people we wanted to be here
to help us with our deliberations.
We will begin with Patrick Kennedy, Under Secretary of
Management for the Department of State. Mr. Kennedy was asked
by Secretary Rice last fall to serve as executive director of a
special panel convened to examine the State Department's
contracting for security, so I welcome you and look forward to
your testimony now.
TESTIMONY OF HON. PATRICK F. KENNEDY,\1\ UNDER SECRETARY FOR
MANAGEMENT, BUREAU OF MANAGEMENT, U.S. DEPARTMENT OF STATE
Mr. Kennedy. Good morning. Thank you very much, Mr.
Chairman, Ranking Member Collins, distinguished Members of the
Committee. I am honored to appear before you today with my
distinguished colleagues. I would like to thank you and the
Committee Members for your continued support and interest in
the Department of State's programs and foreign policy
objectives.
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\1\ The prepared statement of Mr. Kennedy appears in the Appendix
on page 39.
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The Bureau of Diplomatic Security, the law enforcement and
security bureau of the Department, has the primary
responsibility for ensuring the safety and security of State
Department and other U.S. Government personnel operating under
Chief-of-Mission authority overseas. The Diplomatic Security's
nearly 1,500 special agents serve in the United States and
around the world, in embassy and consulate Regional Security
Offices, and manage security programs designed to protect U.S.
Government personnel, facilities, and classified information at
285 posts worldwide.
Even with this presence, the employment of security
contractors has become a critical Department tool since the
1980s for providing services necessary to protect U.S.
personnel, buildings, and information. After the bombing of the
U.S. Embassy in Beirut in 1983, private companies were afforded
the opportunity to compete for security contracts at U.S.
overseas missions under the Diplomatic Security and
Antiterrorism Act of 1986. Over the years, security contractors
have been employed in diverse hot spots around the world, and
as these contracts have evolved, the Department has sought to
standardize the way posts contracted and paid for guard force
services to enhance uniform fiscal reporting responsibilities
and to streamline security management.
Over the past decade, conflicts, wars, political unrest,
and terrorist activities have increasingly required the
deployment of diplomats to areas that are inherently dangerous
places to live and work. As the U.S. Government continues its
diplomatic efforts in these critical areas, the assets and
resources required to ensure the safety and security of U.S.
diplomats and other governmental representatives have also
increased.
The use of security contractors in these dangerous places
has allowed the Department the flexibility to rapidly expand
its capabilities to meet these increased security requirements
and to support national security initiatives without the delays
inherent in recruiting, hiring, and training full-time
personnel. The employment of security contractors remains an
essential cost-effective tool utilized by the Department to
provide security services necessary to support U.S. personnel
and facilities.
The government's Federal Acquisition Regulation (FAR)
enables the Department to procure, sometimes with little
notice, the services of a skilled cadre of security
professionals for emergency needs as world events unfold. The
Department's security contractors perform a narrow range of
defensive duties abroad, including the protection of certain
foreign heads of State, high-level U.S. Government officials--
including Members of Congress--and U.S. diplomats under Chief-
of-Mission authority. These functions are not inherently
governmental, as Department security contractors are engaged in
protecting our diplomats and other officials and are not
authorized to engage in law enforcement or combat activities.
The use of contract personnel allows the Department the
flexibility to rapidly expand or contract the level of security
personnel deployed based upon changing requirements. Most
importantly, it is through the contracting mechanism that the
Department requires security contractors to adhere to stringent
standards of recruiting and training.
The establishment of interagency standards for contractors
would ensure that all U.S. Government security contractors or
subcontractors meet core standards regarding their
qualifications, training, and operations. Over the past several
months, the Department of State has been working closely with
the Department of Defense to accomplish this goal. Agencies
should be allowed the flexibility to augment core standards, as
needed, with additional training and operational requirements.
Contract provisions requiring contractors to comply with
local laws and regulations are additional measures that ensure
appropriate security contractor activity. Such provisions are
currently included in Department of State contracts; for
example, existing contracts require contractors to comply with
all licensing requirements that are established by the host
government. In general, such provisions require contractors to
secure a business license, firearms permits, and firearms
storage licenses, etc.
Contract requirements and government-wide standards are
only as effective as the management and oversight controls
implemented, as the Chairman noted in his opening remarks. The
Secretary of State's Panel on Personal Protective Services in
Iraq, on which I served, carried out a comprehensive review of
the embassy's security practices in Iraq and provided
recommendations, all of which have been adopted by the
Secretary to strengthen these procedures.
The panel also encouraged enhanced coordination and
communication with the U.S. military. To that end, the
Secretaries of State and Defense signed on December 7, 2007, a
memorandum to jointly develop, implement, and follow core
standards in these areas.
Over the past several months, the Department has undertaken
to quickly institute new policies and procedures governing
security contractors. Diplomatic Security agents are now
``embedded'' with every embassy movement of personnel in Iraq.
Procedures have been established to ensure that the Multi-
National Force in Iraq (MNF-I) and the embassy are aware of and
coordinate all movements by each other's details. This
maximizes the Department of State protective support and
provides visibility to battle-space commanders. Respective
liaison officers now serve in operations centers, and both
entities have established procedures to respond to and
investigate incidents.
The State Department has developed new investigative
procedures on the use of force which will also facilitate the
referral of cases to the Department of Justice where there is
evidence of potentially criminal misconduct.
A Joint Embassy Review Board, which also includes U.S.
force representatives, periodically reviews incident
investigations to develop lessons learned, determine trends,
and make recommendations for improvements in private security
contractor operations.
Embassy Baghdad's Mission Firearms Policy has been revised
and reissued to reflect the common principles on ``Rules for
the Use of Force'' that govern private security contractors, as
agreed in the State and Defense Department MOA. And the
Regional Security Officer in Baghdad has established direct
channels of communication and working arrangements on
coordination and liaison with senior Iraqi officials at the
National Police, the Ministry of the Interior, and the Ministry
of Defense.
Moreover, the Department of State strongly supports efforts
to provide greater legal accountability for unlawful acts its
security contractors may commit abroad. The Administration is
currently working with the Congress on legislation concerning
extraterritorial coverage of U.S. criminal laws. We would very
much like to see this critical legislation enacted as soon as
possible.
In addition to private security contractors that contract
directly with the Department of State, there are also those
with contractual arrangements with other contractors,
subcontractors, or grantees of the Department or other civilian
agencies. In accordance with the State and Defense Department
MOA, the State Department has also taken strides to strengthen
oversight and accountability of these security contractors. The
State Department has been actively engaged with the Department
of Defense and the Agency for International Development in
developing core policies for vetting, background
investigations, training, weapons authorizations, movement
coordination, and incident response procedures and
investigations for these subcontractors, arrangements we
already have in place for our direct contractors.
In that vein, on January 30, 2008, the Departments of State
and Defense co-hosted a meeting at the Pentagon with company
executives to discuss further efforts to strengthen security
contractor operations, oversight, management, and
accountability.
With the passage of the National Defense Authorization Act
(NDAA) for Fiscal Year 2008, the Departments of State and
Defense are now actively engaged in the development of formal
regulations governing private security contractors operating in
combat zones, as well as the development of a Memorandum of
Understanding that will address all contractors operating in
Iraq and Afghanistan and establish a common database of
information, as required by Sections 861 and 862 of the Act.
Our joint efforts in developing and implementing the December
2007 MOA have already established a strong foundation for these
regulations. Moreover, the State Department is prepared to
participate in the Defense Department's Synchronized Pre-
deployment Operational Tracking (SPOT) database of these
contractors, anticipated for a DOD rollout in March.
This enhanced coordination with the Defense Department and
our own increased oversight of our private security contractors
has necessitated additional staffing in Iraq by State
Department personnel. In response, the State Department has
initiated temporary deployments of additional Diplomatic
Security special agents to Iraq and authorized a permanent
increase in Baghdad staffing consistent with the recommendation
of the Secretary of State's Panel. With these staffing
requirements straining personnel resources and the need to meet
continual and emerging worldwide security demands, the State
Department will be hiring additional special agents. The
additional requirements are being requested, and with them the
Department will be able to meet these requirements and continue
to provide a safe and secure environment for the conduct of
U.S. foreign policy.
Chairman Lieberman, Ranking Member Collins, I thank you
very much, and other Members of the Committee, for the
opportunity to appear here today, and at the end of the
testimony, I would be glad to receive any questions that you
might have. Thank you very much.
Chairman Lieberman. Thanks, Mr. Kennedy. A good beginning.
I am impressed that you completed your statement exactly as the
10 minutes expired. We do not see that too often.
Mr. Bell, thanks for being here. Jack Bell, Deputy Under
Secretary of Defense for Logistics and Materiel Readiness, has
been a leader in the Department of Defense efforts to
strengthen the integration, oversight, and management of the
large contractor force working alongside military personnel in
Iraq. So you are right in the middle of exactly the questions
we have on our minds, and we look forward to your testimony
now.
TESTIMONY OF HON. P. JACKSON BELL,\1\ DEPUTY UNDER SECRETARY OF
DEFENSE, LOGISTICS AND MATERIEL READINESS, U.S. DEPARTMENT OF
DEFENSE
Mr. Bell. Thank you. Chairman Lieberman, Ranking Member
Collins, other Members of the Committee, thanks for this
opportunity to appear before you to discuss DOD's initiatives
to improve the management and oversight of personal security
contractors--operating in Iraq and Afghanistan.
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\1\ The prepared statement of Mr. Bell appears in the Appendix on
page 45.
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As Chairman Lieberman pointed out, contractors supporting
our military forces in contingency operations, both at home and
deployed, are performing critical support functions that are
integral to the success of our military operations. DOD
military forces--civilian forces also--have been downsized
significantly over the last 25 years, as Ranking Member Collins
has pointed out, and our dependence on contractors has,
accordingly, increased.
In addition, the increasing technical complexity of DOD
weapons systems and equipment requires a level of specialized
technical expertise that DOD does not believe can be cost-
effectively supported by a military force capability.
The current scale and duration of DOD military force
deployments in support of the global war on terrorism (GWOT)
are the first major contingency operations to reflect the full
impact of the shift of the reliance on contractor personnel to
support critical functions of the military deployed in the
field. This has required a substantial commitment by DOD
contractors to deploy with our military forces in forward
areas. As of the first quarter of fiscal year 2008, which ended
December 31, 2007, for example, Central Command (CENTCOM)
reported in January about 163,590 DOD contractor personnel
working in Iraq and 36,520 personnel for DOD working in
Afghanistan.
Chairman Lieberman. Give us those numbers again, because
those are quite significant--some might say stunning.
Mr. Bell. Glad to do that. As of December 31, 2007, CENTCOM
reported in January about 163,590 DOD contractor personnel
working in Iraq and 36,520 DOD contractor personnel working in
Afghanistan.
Chairman Lieberman. So, in Iraq, that is about as high, or
maybe a little higher than uniform personnel that we have had
there.
Mr. Bell. That is correct. The ratio in both theaters is
about 1:1, roughly.
Chairman Lieberman. Yes. That is very important for us to
understand. Please go ahead.
Mr. Bell. Thank you. This unprecedented scale of dependence
on contractors has led us at DOD to recognize the situation
that deployed contractors are a significant and continuing part
of our total force, and DOD must manage our contractors on an
integrated basis with our military forces.
Since 2005, we have launched several major initiatives that
are already strengthening the management of all DOD contractors
and contractor personnel. I will briefly outline those for you.
First of all, we have been working since 2005 on
establishing a strategic policy and operational framework for
managing contractors and contractor personnel in future
operations on a systematic basis.
Second, we have focused on strengthening the management of
current DOD contractor operations in Iraq and Afghanistan.
Third, we are responding to the recommendations in the
Gansler Report on Contracting in the CENTCOM area of
responsibility.
Fourth, as Mr. Kennedy has pointed out, we are implementing
State Department-DOD Memorandum of Agreement governing PSC
operations, specifically in Iraq.
And, fifth, we are both working with the State Department
again and with USAID on implementing Sections 861 and 862 of
the 2008 National Defense Authorization Act.
However, in my testimony today, I would like to focus on
what DOD is doing with the State Department to strengthen the
management of PSC operations in Iraq and Afghanistan.
The operations in Iraq and Afghanistan, as we have all
recognized, have required PSCs to fulfill a variety of
important security missions, operating in non-permissive
environments in support of both the DOD military mission and
State Department diplomatic mission. These include both mobile
physical protection for individuals and delegations, such as
congressional delegation trips (CODELs), and facility
protection for bases, buildings, and supplies.
Again, referring to the first quarter 2008 CENTCOM census
for the period ending December 31, 2007, there were
approximately 6,467 armed DOD personal security contractor
personnel in Iraq and 2,745 DOD personal security contractors
in Afghanistan performing security functions.
Both DOD and the State Department have recognized the need
for more effective coordination of PSC operations in Iraq. On
December 5, DOD and the State Department signed a Memorandum of
Agreement--I will be referring to it as a ``MOA''--defining a
framework for improving both the accountability over PSC
operations and strengthening the actual operational procedures.
This MOA covers a broad range of management policies and
operational procedures to achieve more effective management
coordination in Iraq. The specific provisions of the MOA are
detailed in my written testimony, and also a copy is available
on the DOD website.
The purposes of the MOA, briefly, are to: Establish core
standards for vetting, training, and certifying PSC personnel;
to specifically avoid situations where there is a high risk of
incidents occurring; to integrate incident management and
investigations; to integrate follow-ups with the government of
Iraq's Ministry of Interior and our own Tactical Operations
Centers; and to coordinate follow-ups with any persons affected
by an incident and any witnesses thereto.
MNF-I has already executed and implemented what we call a
Fragmentary Order (FRAGO)--titled 07-428. It establishes
authorities, responsibilities, and requirements for oversight
of all DOD civilians and DOD contractors. The State Department,
as Mr. Kennedy points out, is developing a counterpart document
to reflect U.S. Embassy Baghdad's policies for U.S. Government
agencies working under Chief-of-Mission authority.
Many aspects of the MOA have already been implemented. In
fact, we have adopted interim procedures in cases where
permanent solutions require additional work. At the Office of
the Secretary of Defense (OSD), we are closely monitoring the
implementation status of these elements as they are being put
together in-country.
On January 30, again, as Mr. Kennedy pointed out, Deputy
Defense Secretary Gordon England and Deputy Secretary of State
John Negroponte co-hosted a meeting of PSC company executives.
In this meeting, we discussed the new initiatives covered by
the MOA. We particularly emphasized contractor responsibilities
for the elimination of sexual harassment, ethnic
discrimination, employee misconduct, and criminal activity. We
also covered the implementation of the Uniform Code of Military
Justice, which is applicable to DOD contractor personnel
deployed with our military forces. And again, most importantly,
we emphasized the need to support U.S. strategic goals in the
operations in Iraq and Afghanistan as well as performing
contract missions.
We also discussed the efforts of both the State Department
and DOD to obtain legislation to strengthen the Military
Extraterritorial Jurisdiction Act--MEJA, as we call it--because
we feel it is important to clarify the legal accountability of
non-DOD U.S. Government contractors overseas.
In response to the requirements of Sections 861 and 862 of
the 2008 NDAA, DOD and the State Department are jointly
developing a Memorandum of Understanding (MOU), covering
matters relating to the State Department, DOD, and USAID
contractor operations in Iraq and Afghanistan, and that covers
all contractors, not just PSCs. Once this memorandum is signed,
the MOU will be implemented through DOD, the State Department,
and USAID policies and regulations.
We are also moving ahead at the State Department with
efforts to comply with the provisions of Section 862 of the
2008 NDAA, and that specifically focuses on the management of
PSC operations in Iraq and Afghanistan.
We have already placed a high priority at DOD and the State
Department on registering contracts and contractor personnel in
the theater of operations in something called the Synchronized
Pre-deployment and Operational Tracker System. SPOT provides a
system to: Track contractor personnel movements within Iraq,
Afghanistan, and CENTCOM AOR; verify specifically the authority
of the individual to have authorization and access to specific
facilities; and establish their eligibility for specific
support services.
We are approaching at DOD 100 percent registration and
accountability of all DOD PSCs and contractor personnel
involved in translation and interpretation activities. We
anticipate that SPOT will be a system used also in compliance
with Section 861. The State Department is already participating
in getting their contractors in and is on schedule to basically
get their personal security contractors under prime contracts
into the system by March 2008. USAID is also evaluating how
best to implement the system.
Taken together, these initiatives substantially strengthen
DOD's, the State's Department, and USAID's capabilities in
managing its contractors and in particular its PSC contractors
and contractor personnel compliant with Sections 861 and 862.
We thank you for your interest and support in this effort,
and at this time I look forward to your questions whenever the
other people have finished testifying. Thank you.
Chairman Lieberman. Thank you very much, Mr. Bell.
Mr. Schmitt, you are next. As Senior Vice President of the
ArmorGroup of North America, you served last year as the Chair
of the private security industry's association, the
International Peace Operations Association. The ArmorGroup
itself has 9,000 employees in 38 countries, including 1,600 in
Iraq. Thank you for being here, and I look forward to your
testimony now.
TESTIMONY OF JAMES D. SCHMITT,\1\ SENIOR VICE PRESIDENT,
ARMORGROUP NORTH AMERICA, INC
Mr. Schmitt. Thank you, Mr. Chairman. Mr. Chairman, Senator
Collins, Members of the Committee, I would like to thank you
for having me appear in front of you today with such
distinguished leadership from the Department of Defense, the
Department of State, and from academia.
---------------------------------------------------------------------------
\1\ The prepared statement of Mr. Schmitt appears in the Appendix
on page 52.
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It is an honor to assist the Committee in its review of the
use of the private security industry. And as noted this
morning, the private security industry, my industry, has been
under a great deal of scrutiny due to the recent events and
significant incidents in Iraq and Afghanistan. These events,
especially tragic incidents involving the deaths of private
security employees and local civilians alike, have brought
questions concerning the practices of private security
providers, their oversight, and their accountability to the
front pages of newspapers and morning discussions across
kitchen tables throughout America.
At best, we are viewed as a necessary evil and, at worst,
as trigger-happy thugs who sacrifice America's reputation at
home and abroad and damage its strategic operations by
operating as if we are above the law in the pursuit of a quick,
opportunistic buck. From our perspective, this view is a gross
caricature of an industry in which ArmorGroup, my company, has
been operating for more than 26 years, providing a wide range
of defensive protective services, risk avoidance training,
humanitarian and mine action, and reconstruction and
stabilization efforts.
As private security contractors, it is our actions--good or
bad--and the image we project that influence and shape how the
local civilian populations view our Nation. Perceptions matter.
The conduct and disposition of private security contractors
paint a striking canvas from which we, as a Nation, are viewed
by local inhabitants. As an American, I know how I would feel
about large numbers of foreign security contractors driving
down our streets. Would we really expect the Iraqi people or
the population of any other nation to feel so differently when
they witness an expatriate-laden security convoy careen through
their neighborhood?
While the development of a coordinated and comprehensive
U.S. Government framework for using PSCs has been under
discussion and long in the making, it seems to me that the
question is not when we will use private security providers
but, rather, which firms are best qualified to provide the
optimal support commensurate with our national interests.
Of course, the specific decision on whether to use a PSC
will always depend on the U.S.'s requirements at that time and
on given needs and circumstances. However, experience has shown
that contingency requirements normally develop with little
warning. Hurricane Katrina, the deteriorating security
situation of Iraq in 2003 and 2004, the need to train and
mentor a large number of local security sector personnel in
Iraq, Afghanistan, West Africa, and elsewhere all indicate that
the U.S.'s interests could be best served by identifying,
validating, and competing suitable firms for contingency
response contracts in advance of a crisis or need.
Likewise, U.S. Government demand for private security
contractors seems poised for continued growth with the
establishment of National Security Presidential Directive 44
and Department of Defense Directive 3000.5 for Stability,
Security, Transition, and Reconstruction, both of which
demonstrate the U.S. Government's intent to include the private
sector in future reconstruction and stabilization efforts in
high-risk areas around the world.
For this reason, I believe the U.S. Government's
coordinated framework for determining when to use private
security companies should be less about deciding the when and
more about setting the common standards, the validation, and
oversight procedures necessary that have been addressed so far
this morning. My company, along with many other committed
firms, would prefer to do everything we can in terms of proving
our standards and procedures before a contingency operation
even gets underway so that we are able to respond and deliver
immediately when called upon to do so.
As to the question on whether there is a need to establish
government-wide standards, licensing requirements, or contract
provisions for security providers, the answer can only be
``absolutely, yes.''
The development of industry standards, best practices, and
accountability provisions was first addressed by the private
security industry well before the ramp-up of PSCs in Iraq in
2003. In the case of my company, we have long-established
formal corporate programs to ensure that company employees act
at all times within the relevant international and local legal
and humanitarian frameworks including an employee Code of
Conduct, a stringent ethics policy, and an ethics review board.
We implement deliberate leave rotation, provide personal
insurance and welfare policies, and we teach cultural training
to ensure our employees--whom we refer to as our ``quiet
professionals''--are prepared to provide our protective
services in an ethically sensitive fashion in the most complex
of environments.
In 2004, in keeping with our commitment to transparency, we
published the PSC industry's first white paper, calling on the
U.K. Government to regulate the industry, and we became a
publicly traded company.
Unfortunately, a number of newer PSCs working in support of
U.S. Government programs in Iraq and elsewhere, but without
this rigorous approach to ethics, have found themselves
embroiled in difficult incidents which have resulted in
controversy surrounding the U.S. Government's use of PSCs. The
U.S. Government regulations are clearly beginning to take
shape, including the key oversight provisions for PSCs, as
discussed this morning by the Hon. Patrick Kennedy and the Hon.
Jack Bell. In fact, with regulation now established, the
industry stands ready to assist in its implementation.
PSCs will gladly follow the U.S. Government's regulatory
requirements provided to them. And with the establishment of
the MOA between the Department of State and the Department of
Defense for PSC operations in Iraq, and the provisions of the
2008 National Defense Authorization Act, the industry is
hopeful that this will be a blueprint of interagency policies
and operating practices that can be applied to other future
areas of operations as required.
We stand ready to assist and will do so more efficiently
when the implementation procedures are developed in an
inclusive manner with the U.S. Government taking into account
companies' experiences and management practices. Companies that
comply with prescribed regulatory and performance standards
should be rewarded with more opportunities to support the U.S.
Government stabilization objectives; companies that do not
should be held accountable through the loss of contracts and
the ineligibility to bid on new ones.
We also suggest implementation of the following mechanisms:
First, involve PSCs and other stakeholders in ongoing
standard-setting dialogues and implementation processes;
Second, a codification of standards and best practices in
company policies and daily operating procedures;
Third, training of U.S. Government personnel interacting
with PSCs within the Combatant Command (COCOM)/Chief-of-Mission
AOR;
And, last, education for impacted local populations on the
means to identify PSCs and how to register a complaint through
appropriate authorities concerning PSC operations.
Additionally, we also see a more proactive role for trade
associations.
While many industry best practices are codified in the
existing codes of conduct and ethics policies of individual
firms and internationally recognized trade associations, not
all U.S. Government private security contractors are members of
these trade associations or have adopted codes of conduct.
An alternative method of regulation could be that the U.S.
Government mandates that its PSCs require some type of third-
party accreditation, potentially through trade associations, to
validate their attainment of industry standards. Strict
enforcement of these standards ultimately depends upon the will
and consensus of the association's members to prove an
effective self-enforcement mechanism exists, and upon the U.S.
Government to demonstrate that it takes these standards
seriously by committing to only work with those companies who
have obtained accreditation.
Oversight for private security contractors begins with a
corporate commitment to the ethical delivery of services that
we believe at a minimum should contain the following
provisions: Knowledge of, and respect for, indigenous
populations; a defined corporate ``operating envelope'' which
limits a company's role to purely protective, defensive
security support; a formal declaration that the company will
not plan or participate in offensive operations; full adherence
in mandatory induction and continuation training on U.S. and
host Nation local laws, international human rights and
humanitarian law, and country-specific rules for the use of
force; a commitment to cooperate with local and all law
enforcement agencies and submit records of all notifiable
incidents to those agencies; a commitment to transparency by
registering host Nation subsidiary companies; a formal
declaration that the company will not plan or participate in
any operations that seek to destabilize governments or alter
the political or military balance in a host nation; a
commitment that the company will not supply lethal equipment
nor permit employees to bear arms, except for those carried for
personal protection or for the defense of clients, without
possessing a license from the host government or mandated
authority; and, finally, the establishment of an executive-
level ethics committee to review and approve all significant
new client contracts.
Additionally, and in closing, we believe that U.S.
Government resources in areas of operation would help provide
improved oversight to private security providers.
While reputable PSCs can and have established policies and
codes to ensure the ethical delivery of their services,
ultimately only the U.S. Government can establish formal
industry-wide regulatory and ethical standards though the
introduction of more stringent contractual obligations and a
commitment to the enforcement of these obligations
The regulatory provisions described above and discussed
earlier are an important step in establishing standards, but
will only be effective if sufficient resources are committed to
ensure that they are upheld and a more rigorous approach is
taken towards those who do not uphold them.
Working under the direction and guidance of Congress and
the U.S. Government agencies we support, the private security
industry is capable of providing meaningful contributions to
U.S. Government stabilization and reconstruction efforts in
high-risk areas around the world. This work, we know, must be
delivered with full adherence to U.S. and host Nation local law
and with full commitment to the provisions of international
human rights and humanitarian law.
I very much appreciate the opportunity to speak to you this
morning, Chairman Lieberman and Ranking Member Collins, and to
the Members of the Committee, and I look forward to taking any
questions.
Chairman Lieberman. Thanks, Mr. Schmitt, for that
constructive testimony. I appreciate it.
Our last witness this morning is Professor Laura Dickinson
of the University of Connecticut Law School. I will express
parochial pride in the fact that you are here from UConn Law,
and I will say with additional parochial pride that is not why
you are here. But the staff of the Committee, in asking people
who in academia would have the most to contribute, kept
receiving your name in answer to that question, and I was very
pleased to hear that.
Professor Dickinson has written extensively on U.S.
Government privatization of foreign affairs functions. She
served during the Clinton Administration in the Department of
State's Bureau of Democracy, Human Rights, and Labor.
Thank you very much for being here.
TESTIMONY OF LAURA A. DICKINSON,\1\ PROFESSOR, UNIVERSITY OF
CONNECTICUT SCHOOL OF LAW
Ms. Dickinson. Thank you, Mr. Chairman, Ranking Member
Collins, and other Members of the Committee. It is a great
privilege to be here with such a distinguished panel.
---------------------------------------------------------------------------
\1\ The prepared statement of Ms. Dickinson appears in the Appendix
on page 60.
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While most contractors have performed admirably and have
filled vital roles--and, indeed, more than 1,100 have died in
Iraq--many have committed serious abuses without being held
accountable. The use of private security contractors and
interrogators poses special risks and potentially threatens
core values embodied in our legal system, including respect for
human dignity and limits on the use of force, as well as a
commitment to transparency and accountability.
How should Congress respond to the problems posed by
private security contractors? One possibility is to define
certain functions as inherently governmental, such as security,
and ban outsourcing of these functions entirely. However, the
drive to use contractors will likely persist and may even
expand, particularly once the inevitable drawdown of troops in
Iraq begins. Therefore, it may be difficult, and perhaps even
unwise, to limit significantly the use of such contractors.
Another approach might be for Congress to define such
functions as core functions rather than inherently
governmental, which would permit outsourcing, but at the same
time impose limits on the percentage of positions that may be
turned over to contractors while mandating higher standards of
oversight for these positions.
Regardless, Congress will need to institute more effective
measures to punish contractors who commit abuses. The MEJA
Expansion Act of 2007, which has already passed in the House
and which is pending in the Senate, would close important
loopholes in the Federal courts' jurisdiction over contractors
who commit crimes overseas. I suspect, however, that these
types of back-end enforcement measures, while critical, will be
insufficient. I, therefore, propose five steps that Congress
can take to improve contracting practices, oversight, and
monitoring so as to better prevent abuses before they occur.
First, Congress should establish minimum standards for
contractual terms. As my co-panelists Mr. Bell and Mr. Kennedy
have testified, the Department of State and the Department of
Defense have made significant progress in this area. However, I
recommend that we do more. I think Congress should go further
and establish a set of minimum standards to guide the drafting
of private sector contracts. These minimum standards would
explicitly make contractors subject to clear, consistent rules
regarding the use of force and establish specific requirements
for training and recruitment.
With respect to the use of force in particular, these rules
should be both specific and consistent across governmental
departments. Indeed, the Department of Defense and the
Department of State rules have sometimes differed from each
other. For example, as Mr. Kennedy's report concluded in the
wake of the September 16, 2007, Blackwater incident, the
Department of Defense at the time required its security
contractors to fire aimed shots when responding to a threat,
while the Department of State did not.
Similarly, Congress could mandate that contracts with
private security companies do more to explicitly require that
contractor employees receive training in the applicable limits
on the use of force, including very specific training in
international human rights and humanitarian law. Experts have
concluded that training thus far has in some cases been
insufficient. DOD's recently proposed rule that certain
security contractors should receive training by military
lawyers is a very strong measure that would be a significant
improvement. I would argue, however, that Congress should
legislatively require such training rather than leaving it up
to agency discretion, as the agencies have differed in their
practices on this question.
Congressionally mandated standard contractual terms should
also include consistent recruiting and vetting requirements for
security contractor employees. Vetting becomes even more
critical and more difficult as the number of non-citizen
contract employees rises. Finally, in the increasingly global
market for labor, recruiting practices are particularly
important, and Congress could impose minimum standards here as
well.
Second, Congress should encourage better interagency
coordination. Government officials from the multiple agencies
that have hired security contractors have not in the past
communicated well with each other in the field or in
Washington, contributing to a climate of confusion that can
create abuse. For example, in some cases, military commanders
have not known when security contractors hired by other
agencies passed through their areas because there was no clear
system in place to communicate that information to them. And
the agencies have not had a working, unified system for
counting, let alone keeping track of what contractors are
doing.
As mentioned above, agencies have applied different rules
regarding the use of force, and when there are investigations,
multiple agencies have been on the scene. Moreover, the precise
jurisdiction of each agency has been unclear, leading to
further confusion.
For this reason, we must improve interagency coordination
of contractors both on the ground and in Washington. The
Memorandum of Understanding between the State and Defense
Departments is an important step, but we can do much more. I
would argue that Congress should require the establishment of
an interagency working group to set common standards for
security contractors and design uniform systems for keeping
track of them, improving communication, and clarifying lines of
authority.
Third, Congress should expand the contract monitoring
regime. An effective contractual regime must include sufficient
numbers of trained and experienced governmental contract
monitors. We have recently cut back on the acquisitions
workforce, and the personnel who are on the payroll do not have
adequate incentives to serve in Iraq and other conflict zones.
The problems caused by the sheer low number of personnel are
exacerbated by a lack of expertise in the particular issues
raised by security contractors. Many of the contract personnel
were trained in another era. They did not learn how to manage
service contracts, let alone service contracts that raised the
specific problems regarding security.
Congress should mandate that agencies increase the number
of monitoring and oversight personnel, ensure that they
specialize in the types of tasks they are overseeing, and
require that they receive specific training in rules regarding
the use of force.
Fourth, Congress should require regular reporting. One of
the factors that is creating the oversight challenge is a lack
of information, combined with the piecemeal way that much
information about contractors comes to Congress and to the
public at large. Recent legislation and bills in the pipeline
would improve the situation but do not go far enough. Congress
should require each agency to report to Congress quarterly or
every 6 months. If Congress establishes an interagency working
group, it could be the task of this group to coordinate and
provide the report. Moreover, this report should not only
identify the number of contractors and oversight personnel, but
it should provide information about the tasks the contractors
are performing, the number of incidents in which security
contractors fire their weapons and injure third parties, and
qualitative assessments about whether these incidents raised
concerns.
Furthermore, the reports should provide information about
follow-up: Whether there was an investigation, what the
conclusion was, and what happened subsequent to the
investigation. If the State Department can report annually on
the human rights conditions in all of the countries around the
world, the agencies should be able to provide Congress with
minimal information about their own security contractors. Of
course, any mandate should be funded so that the agencies have
the resources to do this work.
Finally, Congress should foster accreditation and
licensing. Congress should encourage the creation of third-
party monitoring, accreditation, and certification entities and
then consider requiring such third-party approval as part of
the contract. At least one industry organization, the
International Peace Operations Association, has launched this
sort of a system, and its work has been very important.
Accreditation by an independent organization, I would argue,
would be an even better approach, but no organization yet
exists. The National Committee on Quality Assurance, which
rates and monitors health maintenance organizations (HMOs) in
the health care area, might serve as a model. Congress could
encourage the creation of such an entity by providing seed
funding or, as it has done in the health care area, by giving
agencies the authority to deem ratings by such an independent
entity as sufficient to satisfy congressionally mandated
standards.
In conclusion, it is extremely important that Congress move
forward with this Committee's efforts to impose greater
contractual standards and monitoring requirements on private
security contractors. To that end, in addition to any
legislation arising from this Committee, the work of the new
Commission on Wartime Contracting in Iraq and Afghanistan will
provide an important forum for further consideration of these
issues.
Thank you very much for the opportunity to address this
Committee.
Chairman Lieberman. Thank you very much, Professor
Dickinson. Thanks for the suggestions, and I promise you that
we will consider those as we consider whether and how to
legislate, as we will the suggestions that Mr. Schmitt made. We
are going to do a 6-minute round of questioning to move the
discussion around to the Members here.
I appreciate what has been done to provide for better
management of private security contractors, as both Mr. Kennedy
and Mr. Bell have testified to. Let me try to focus on the
question on which I am interested in, which is, are we using
private security contractors too much? In other words, are we
for various reasons using private security contractors in what
might be called inherently governmental functions that would
better be carried out by full-time government personnel?
I know you could talk for hours on that. I want to ask Mr.
Kennedy and Mr. Bell just to give me a quick response to that
overall question. Too many PSCs?
Mr. Kennedy. Mr. Chairman, I do not think so, for two
reasons. The way the State Department uses PSCs, we ensure that
they do not engage in any law enforcement activities and they
do not engage in any what I will call ``aggressive combat
activities.'' They simply engage in defensive activities.
The second point I would make, Mr. Chairman, is that, at
least for the State Department, the ebb and flow of the
activities in Iraq today, Xanadu tomorrow, or Shangri-La next
year create a curve that I do not believe that the State
Department has the resources to meet. We only have 1,500
special agents. To deploy them all to Iraq and Afghanistan
would mean we would have no defensive advisory capability at
any other post in the world, as well as no one in Washington to
pursue important activities such as combating passport and visa
fraud. So I believe that private security contractors, with
appropriate oversight, with the full panoply of restrictions
and injunctions placed into the contracts, constitute an
important tool for the State Department to carry out its
mission.
Chairman Lieberman. So I understand the second part of what
you said. Obviously, there is a benefit to a private security
contractor because it is not a full-time governmental employee
and you can retain their services in the arena where you need
them. But I wonder, if I can phrase this question differently,
whether we are at a point where we ought to be able to foresee
not only the need for private security contractors in Iraq and
Afghanistan but, to carry on your wonderful fantasy names,
Shangri-La and Xanadu and, therefore, increase the total number
of full-time Diplomatic Security beyond the 1,500 that it is at
now.
Mr. Kennedy. Mr. Chairman, we employ in Iraq alone 1,518
contractors, just in the security arena, which is almost
exactly the same number as the Diplomatic Security special
agents we have. We also employ other contractors, for example,
assisting our personnel who go into the Gaza Strip or the West
Bank.
I do not feel confident to say that requirement would
continue in perpetuity. I wish to have a robust Diplomatic
Security Service. I think that is essential to permit us to
carry out our activities abroad. But a doubling or a tripling
of the Diplomatic Security Service, I am not sure about, Mr.
Chairman. We are seeking a few additional resources so that we
can have, as the Secretary has mandated from the report, a
Diplomatic Security special agent move as the agent in charge
in every one of these convoys. I think that pairing of a
Federal agent as the agent in charge, backed up by contractors,
is the appropriate way to go, sir.
Chairman Lieberman. Mr. Bell, what is your quick answer on
the DOD side? Too many PSCs?
Mr. Bell. Sir, we do not believe so, and I think it is
important to insert in the record here very briefly that we are
operating within a well-defined U.S. Government policy
regarding what is an inherently governmental function and what
is not. As you know, Policy Letter 92-1 from the Office of
Management and Budget (OMB) defines what is an inherently
governmental function and what is not. And I would just like to
emphasize that Appendix B, Paragraph 19 of that Public Policy
Letter specifically exempts personal security contractor
functions as not being inherently governmental.
That policy has been in place since 1992. We have built our
DOD force structure around the assumption that they would not
be inherently governmental.
So, for example, if you looked at the approximately 9,200
personal security contractors that we have in Iraq and
Afghanistan, using the Congressional Budget Office analytical
construct from their work in 2005 on DOD staffing, it would
indicate we would probably have to have somewhere on the order
of magnitude of nine brigades of military forces to support the
rotation of troops in and out for a fielded force of 9,200
private security contractors.
Chairman Lieberman. I hear you on that. The fact is that
there have been numerous incidents that have drawn private
security contractors in Iraq into hostilities, when they have
been deployed to protect personnel, convoys, or facilities in
hot zones. I understand, for instance, that Forward Operating
Base Shield, which is a quarter mile from Sadr City, is guarded
by a contractor.
So I wonder whether there has been any shift in the
Department's policies about when security contractors should be
used and when they should not, and whether, in fact, they are
not inherently in some of these cases in hot zones performing
governmental functions.
Mr. Bell. The line of distinction, as Mr. Kennedy has
pointed out, is whether they are used for defensive purposes or
need to be involved in offensive combat operations. Static base
security is considered to be defense. The private security
contractor personnel that we have engaged in that static
security defense are clearly trained on the fact they are not
to engage in offensive operations. But as for any base that is
threatened by a hostile force, the role of that security force
is to protect that base.
So that is the distinction that we have been using within
the Executive Branch, certainly at DOD, regarding what is an
appropriate role for a private security contractor.
Chairman Lieberman. OK. My time is up, but I want to come
back to this in the second round. Thanks very much. Senator
Collins.
Senator Collins. Thank you. Actually, Mr. Chairman, you
have set up perfectly the questions that I want to ask, because
I, too, believe that the fundamental question here is what
functions are appropriate to contract out and what functions
should be retained and are, in the bureaucratic term that we
use, inherently governmental.
This is a section of the Army Field Manual, and as you can
see, it is a very thick section. And it is entitled
``Contractors on the Battlefield.'' It sets forth the standards
for when you would use a contractor. It is very detailed. It
was written by a contractor. In other words, a private security
contractor wrote the guidance in the Army Field Manual for
using contractors on the battlefield. And I want to ask each of
you whether you think that is appropriate.
It seems to me that this is inherently governmental, but
even if it is not inherently governmental, it seems to me that
there is at least an inherent conflict of interest to have a
contractor writing the section of the manual on the use of
contractors. But I am going to start with you, Mr. Bell, since
it is a DOD document.
Mr. Bell. With all due respect, Senator Collins, I am sure
that that document was not issued without detailed review by
both military and civilian employees of the Department of
Defense. We do, as you know, use contractors for different
drafting purposes. I have not actually seen the manual in
detail. I know specifically what it is. But I would suggest
that the document has been thoroughly vetted by both DOD
military personnel as well as civilian personnel in its
issuance.
Obviously, there is the appearance, as you are pointing
out, of an apparent conflict of interest in that, but I would
suggest that that probably had very detailed screening.
Senator Collins. Well, our understanding is that the
contractor received some basic guidance, but essentially did
the job. It obviously was reviewed----
Mr. Bell. Right.
Senator Collins [continuing]. As you have said. I want to
ask the professor her opinion on this.
Ms. Dickinson. Well, I do think it raises concerns, a
broader concern, which is that when you outsource certain
functions, there is a risk that you lose the capability in-
house. Now I am not suggesting that the military has lost the
capability of doing that particular job, but with respect to
security, I think there is a risk, and that is why I think we
ought to think about limiting the percentage of positions that
can be outsourced. And, of course, anytime you have risk to
human life, then there is a greater concern, and so there
should be greater oversight.
Senator Collins. Thank you.
Mr. Bell, another specific issue that is raised by this
Army Field Manual is the role of contractors in the
interrogation of prisoners. Now, I am told that an earlier
version of this manual in 2000 had a specific prohibition
against intelligence work being performed by private
contractors. But in 2003, when the manual was revised--this
version--that policy was omitted. And, subsequently, we had the
abuse at Abu Ghraib. And according to the Fay Report, private
contractors allegedly were involved in 10 of the incidents of
abuse of Iraqi prisoners.
Do you believe that the interrogation of prisoners is an
inherently governmental function that should not be contracted
out?
Mr. Bell. I can say, irrespective of my personal beliefs on
this, that it has been defined that interrogation, translation,
and prisoner/detainee operations are not considered inherently
governmental functions. I think to the extent that we wanted to
get into personal discussions, there would be a lot of
different opinions on that. What we operate on is what is
provided for specifically in the U.S. Government guidance.
Senator Collins. Are you aware of a dispute within the Army
on whether the earlier policy should have been reinserted into
the 2003 version of this manual?
Mr. Bell. Senator Collins, I actually am not.
Senator Collins. OK. Mr. Kennedy, I also want to get your
views on the timeline for finalizing a Memorandum of
Understanding for Afghanistan. I understand it is finished for
Iraq, but where are we as far as coming up with the same sort
of guidance for Afghanistan?
Mr. Kennedy. Senator, the requirement in the Defense
Authorization Act for 2008 requires this to be done within 6
months of the date of enactment. And Mr. Bell and I are under
specific orders from Deputy Secretary England and Deputy
Secretary Negroponte that we are not to fail to meet that
deadline. So it will be done within 6 months, and it will
incorporate Afghanistan and Iraq as the Defense Authorization
Act requires.
There is already a first draft of it circulating among our
agencies, and we have every intention of making it. It is a
complicated issue because of the volume of individuals to be
registered and conforming practices. But there is a clear
congressional mandate, and we will meet it, ma'am.
Senator Collins. Thank you.
Mr. Bell. Let me clarify Mr. Kennedy's comment. With
specific regard to PSC operations for Iraq and Afghanistan, we
have 120 days after the enactment of the legislation to comply
with Section 862. Mr. Kennedy was referring to the larger
issue, and Section 861 is where we have to put in place the
database, the tracking mechanisms, and the policies regarding
all DOD, State Department, and USAID contractors. But the
deadline for PSC compliance is 120 days after enactment, so
that is in April.
Senator Collins. Thank you.
Chairman Lieberman. Thanks, Senator Collins. Senator
Tester.
OPENING STATEMENT OF SENATOR TESTER
Senator Tester. Thank you, Mr. Chairman. I want to thank
all the witnesses today for being here. This is a very
important hearing. It has been very valuable to me. I think
there are a couple reasons why we have such a hearing, and
other people may have different opinions: to make sure that
taxpayer dollars are spent to the best effect and that they are
not being wasted. Regrettably, I do not see an urgency there,
and I have heard a lot of information about what has been going
on with contractors, particularly in Iraq. And it is of great
concern to me.
I am very proud of the nine freshmen in this Senate, led by
Senator Webb, Senator McCaskill, and others, who are setting up
a contracting commission to find out what is going on and get
to the bottom of how these dollars are being spent.
Unfortunately, I think the President put a signing statement on
that DOD authorization bill that I hope does not block this
important work.
It is important we spend the dollars correctly for obvious
reasons. When you are at war, the money has to go to what is
important--armor protection, bullets, equipment, those kind of
things. And then we also need to understand how contracting
would affect our troops, and there is a lot of information out
there about what the contractors are getting paid versus what
the troops are getting paid--6 or 7 times as much is what I
have heard. And I think that could have a tremendously negative
effect on morale. So I really appreciate your being here. I do
have some questions.
Mr. Kennedy, you talked about local laws and regulations
being adhered to by the contractors. When did this start
occurring?
Mr. Kennedy. Senator, it is a requirement in the State
Department worldwide security contract that we issue that
governs all the contractors we employ. It is a prima facie
requirement.
Senator Tester. OK. Has that been put in all the contracts
from the beginning? Because there are plenty of examples where
contractors have, well, to be blunt, killed Iraqis and have
been escorted out of the country before any law enforcement
could take place in Iraq.
Mr. Kennedy. It has been in the contract. We have referred
the case, I believe, that you are referring to, Senator, to the
Department of Justice. And, unfortunately, I cannot comment on
it any more because I do not have any information from DOJ.
Senator Tester. That is fine.
Mr. Kennedy. But we are pursuing that case at DOJ, and if
it is appropriate, the individual would be brought to justice.
Senator Tester. How many contractors are Americans and how
many are foreign?
Mr. Bell. It varies, depending on whether they are personal
security contractors or not.
Senator Tester. Well, of the total 163,000--well, over
200,000, approximately, ballpark figure?
Mr. Bell. The figure, I believe, is about 17 percent
Americans.
Senator Tester. Seventeen percent American, 83 percent
foreign born?
Mr. Bell. Yes, sir. Most of those are third-country
nationals, but we have some host-country nationals as well.
Senator Tester. Is that about the same ratio in the
Department of State?
Mr. Kennedy. No, sir. All of our direct personal security
contractors are Americans.
Senator Tester. OK, so of that 9,200 that you talked about?
Mr. Kennedy. It was 1,500, sir, we have 1,500 personal
security contractors in Iraq; 792 are personal security
professionals. They are all Americans.
Senator Tester. OK.
Mr. Kennedy. We have 431 static guards. Almost all of those
are third-country nationals with American supervisors. And then
there is some support personnel, technical personnel, cooks,
etc., who are----
Senator Tester. OK. You actually used two terms. You used
1,500 special agents, and then during testimony somewhere--and
I think this was attributed to you--you said there are 9,200
PSCs. Is that incorrect?
Mr. Bell. That is actually my quote, Senator. That is 9,200
in Iraq and Afghanistan for the Department of Defense.
Senator Tester. Help me out. You have 163,590.
Mr. Bell. Yes, sir.
Senator Tester. Where is the 9,200?
Mr. Bell. The 9,200 are a subset of that. Those are the
personal security contractors that are a subset of the total
number of contractors.
Mr. Kennedy. And, Senator, if I might, it just happens to
be that our number of contractors in Iraq is 1,518, and the
total number of our special agents worldwide is 1,500
Senator Tester. So you are saying that 1,518 is 100 percent
American.
Mr. Kennedy. No, sir. Half of--792 of the 1,518----
Senator Tester. So half American.
Mr. Kennedy [continuing]. Are Americans. Half of them, and
then of the other half, about 10 percent or so have American
supervisors, but those are static guards or support personnel.
Senator Tester. Good enough. One thing that came to me--and
this goes back to the questions of the Chairman and Senator
Collins. Mr. Bell, you talked about weapons systems were pretty
much being manned by contractor personnel. That is somewhat
concerning to me. We are talking about weapons systems that are
being operated by contract personnel that, quite frankly, could
go to the highest bidder anywhere in the country.
Mr. Bell. The way it works, Senator, is we have about
12,500 contract----
Senator Tester. Numbers aside, just that philosophy, can
you tell me what the justification of it is?
Mr. Bell. The justification is usually the original
equipment manufacturer (OEM) of a system--it is not usually the
entire weapons system. It is a specific component of the
weapons system. It is involving technology that has to be
maintained.
Senator Tester. OK.
Mr. Bell. And so most of the contractors that we have doing
that are representatives of the OEM.
Senator Tester. OK. Thank you, Mr. Chairman.
Chairman Lieberman. Thanks very much, Senator Tester.
Senator McCaskill.
OPENING STATEMENT OF SENATOR MCCASKILL
Senator McCaskill. Thank you, Mr. Chairman, and thank you
to the panel this morning. I have sent a letter to President
Bush about the Status of Forces Agreement (SOFA). What I am
really concerned about here is this notion that we are
negotiating potential immunity from Iraqi law for contractors
before it is very clear that every single contractor involved
in a contingency operation or in a war zone is accountable to
someone.
As you all know, there are various, different types of laws
that contractors are potentially accountable under. There is
the Military Extraterritorial Jurisdiction Act, obviously.
There is the Uniform Code of Military Justice. There are laws
in the United States of America. And depending on what kind of
contractor you are, it is not clear where you fall under these
various accountability regulations.
What I would particularly like to hear from Mr. Kennedy and
Mr. Bell is a commitment on the part of the Departments of
State and Defense that you would support the notion that we
should enter into no agreement until it is laid out under the
letter of the law, the accountability for acts performed by
contractors that are in direct violation of our standards of
conduct in the United States of America.
Mr. Bell. Senator, we are already on the record, both the
State Department and DOD, as strongly encouraging Congress to
pass the amendment for the MEJA provision here. We think there
is ambiguity in the current law that needs some attention, and
until that is done, obviously, there are some questions about
it.
I think certainly we would feel it would be ill-advised to
issue an additional task order in support of our troops and our
combat operations until that law passes because it is obviously
something outside our control. But we very strongly endorse the
recommendation that the MEJA law be passed as quickly as
possible.
Mr. Kennedy. If I could second that, one of the
recommendations of the panel for which I was executive director
is specifically to seek clarity, and in turn, the Secretary of
State and Secretary of Defense have talked about this, along
with the Department of Justice. And we fully agree with you,
this must be clarified.
There are statutes that are available to the Diplomatic
Security Service if the event takes place on U.S. Government
owned or leased property abroad. But there are obviously gray
areas, and we want absolute clarity. We fully support, believe,
and endorse that if a contractor employee commits a violation,
it would be a violation in the United States, that individual
should be brought to justice.
Senator McCaskill. Do you agree that the President should
not negotiate any Status of Forces Agreement and execute any
agreement unless and until that law is clarified?
Mr. Bell. Our great hope, Senator McCaskill, is that the
law will be passed well in advance of the conclusion of SOFA
negotiations, which are not scheduled to be concluded until
some months from now. It is our view that this law needs to be
passed as quickly as possible.
Mr. Kennedy. Negotiating something as complex as the SOFA
agreement or an agreement based upon the Vienna Convention is a
very complex and time-consuming activity. And I believe that it
is important that the negotiations proceed sequentially.
Senator McCaskill. On another topic, I want to make sure I
get both Defense and State Departments on the record today
about the new auditing authority given to the Special Inspector
General for Iraq Reconstruction (SIGIR) and to the Special
Inspector General for Afghanistan Reconstruction (SIGAR) in
last year's defense authorization bill that was signed into law
by the President. I sponsored an amendment that expanded the
authority of the SIGIR and for the new SIGAR to be able to do
audit work in the area of these security contracts.
The tricky part is getting the Inspectors General at the
State Department and at DOD to cooperate and work effectively
in order to make sure that the horizon is covered with the
appropriate audit work. I know that Mr. Krongard had testified
in front of Congress that he did not have sufficient resources
to do the kind of audit work that, frankly, would have exposed
some of the problems that have been exposed in the press. It is
bad when we learn about bad stuff by someone other than the
Inspectors General because that means the Inspectors General
are not adequately doing their jobs or do not have the
resources to do their jobs. And many times it is the latter,
not a lack of will.
I know that Mr. Krongard is now gone from the State
Department, but it is my understanding there have been
meetings, regarding where we have jurisdiction here, and we are
not sure, so we are anxious for you to do these audits. This
amendment was passed to make sure that no one had the excuse
that someone did not have the responsibility for doing the
audit work in this important area.
Mr. Bell.
Mr. Bell. Having spent 7 months in Afghanistan in 2003 and
2004, Senator McCaskill, I strongly welcome the approval of the
SIGAR authority, to establish the same authority there we have
in Iraq with SIGIR. So I welcome that.
I personally have not seen any evidence of any territorial
disputes between DOD and SIGIR. I do not know the personnel who
may eventually be nominated to take the responsibility for
SIGAR. I know some qualified candidates. Knowing General
Kicklighter, who is our Inspector General, I would assume that
he has no sense of turf or stovepiping desire in his duties and
would welcome that opportunity.
I believe that SIGIR has done a good job as much in
preventive oversight as in retroactive oversight, and I think
that is an important thing to establish. We have recognized in
some work the Secretary asked me to do last September that we
needed to strengthen the oversight in the field. We have given
authority to the Joint Contracting Command in Iraq and
Afghanistan so that they must pre-clear all contracts. We are
adding up to 300 Defense Contract Management Agency (DCMA)
personnel going into Iraq and Afghanistan before the end of
March; a hundred of them are already deployed--all with the
point of view I think the direction you are leading, which is
we need much stronger integrated oversight of all post-award
contract administration.
Senator McCaskill. And I am more worried about the State
Department than I am the Defense Department in this regard.
Mr. Kennedy. As you know, Senator, the Inspector General is
an independent entity within the State Department and not under
the jurisdiction of the Under Secretary for Management, as it
should be.
I have been briefed that the Inspector General of the State
Department's team and SIGIR have already engaged in some joint
reviews. I know that the Inspector General of the State
Department is in the process of staffing a regional office in
Amman, Jordan, so that the new Inspector General or the current
Acting Inspector General will have resources in the field,
because I fully agree that oversight by an independent entity
such as an Inspector General is a critical element. I welcome
that. I welcome the information that the Inspectors General can
provide to me as the management adviser to the Secretary so I
can make course corrections when I see that.
If I could also second something that Mr. Bell has said, we
are just in the process of changing over our entire contracting
support operation in Iraq to what we call a working capital
fund so that we assess a small fee on every contract and that
fee goes to the contracting office that guarantees, as work
rises and falls, they have sufficient resources to give every
contract the sufficient front-end work, signing work, and post-
award work.
So these are activities that I personally am very committed
to, and I know that our Inspector General is working with SIGIR
and is working to push personnel into the field so they are
closer to the scene in Iraq and can do a better job.
Senator McCaskill. OK. Thank you, Mr. Chairman.
Chairman Lieberman. Thanks very much, Senator McCaskill.
Senator Akaka, welcome.
OPENING STATEMENT OF SENATOR AKAKA
Senator Akaka. Thank you very much, Mr. Chairman. Let me
apologize for being here late as I was chairing another
hearing.
Chairman Lieberman. Understood. Thank you. Glad you came.
Senator Akaka. And I welcome our witnesses here. Mr. Bell,
many reports indicate that Department of Defense private
security contractors utilize non-American personnel.
Specifically, a January L.A. Times article pointed out a firm
called Triple Canopy that relied on Peruvian citizens to work
security in Iraq.
How can the Department adequately ensure the suitability of
non-U.S. citizens for work as security contractors? And what
additional challenges do they pose for the Department?
Mr. Bell. Thank you, Senator Akaka. It is good to see you
again, sir. Obviously, every private security contractor has to
be vetted from a security perspective in their home country,
just as they would for an interpreter, a translator, or an
intelligence operative. And so the vetting process is conducted
against the same standards we would use for any other function
where we recruit foreign nationals to do that.
Out of the 6,467 armed security contractors we have in Iraq
working for DOD, about 5,300 of them are third-country
nationals. Many of them come from countries where that vetting
process is relatively easy, such as the U.K. and South Africa.
There are a number of others where it is more difficult, but we
have the procedures and the capability to do that vetting, and
that has not been, to our knowledge, a problem.
Senator Akaka. I understand some of these have experience
as ex-military personnel and ex-policemen in their countries.
Let me ask, are there background checks made on each one of
these individuals?
Mr. Bell. There are, sir, and in fairness, when we recruit
people, for example, there are a substantial number of former
British Army Gurkhas, who have obviously been vetted by the
British Government themselves, who are working as private
security contractors. We do additional vetting over and above
their credentials for having served in a government. So that is
done on an individual basis.
Senator Akaka. Mr. Schmitt, in your testimony you alluded
to security contracts being awarded based more on claimed
versus demonstrated capabilities. Can you please explain that?
Mr. Schmitt. Certainly, Senator, and good morning.
Senator Akaka. Good morning.
Mr. Schmitt. That basis really comes from some of the
observations that I personally had when I had the opportunity
to serve at the Coalition Provisional Authority (CPA) in 2003
and 2004 in Iraq. And more publicly, from some of the instances
we have seen that are really a matter of public record--and I
guess probably the most striking example would be the Custer
Battles Company, which, as I recall, had really no background
or past performance as a security provider whatsoever, but was
awarded a security contract to provide the security for the
Baghdad International Airport.
So for an established firm, not just mine but many others,
to see something like that and then to see that contract really
disintegrate, we took great concern with that. And certainly
the FAR exists for a reason, both at the Federal level and at
the agency level, but we also are sympathetic that there was
such great need at that time and such great demand that the
services need to be rendered quickly.
Our view is that, as I mentioned this morning, Senator, if
we can identify the processes in advance, much like the
indefinite delivery/indefinite quality (IDIQ) contracts that
are more greatly being used by the agencies, the agencies then
can identify suitable providers before the need occurs. And
when that need occurs, the providers are ready to respond. The
American taxpayer has the assurance that the provider is, in
fact, qualified and is, in fact, prepared to do what they have
demonstrated they can do through the evaluation process.
Senator Akaka. Thank you.
Mr. Bell, one concern raised in a joint Subcommittee
hearing I co-chaired on January 24, 2008, regarding contingency
contracting in Iraq and Afghanistan was that contractors are
not under the same obligations as U.S. servicemen and
servicewomen. For example, a contractor could refuse to travel
to dangerous areas of Iraq.
Does the Department feel comfortable that there is a strong
chain of command with private security contractors?
Mr. Bell. Yes, Senator Akaka, we did discuss that at the
last hearing. We are comfortable that we are being fully
supported by the contractor companies. If they have an internal
problem with an individual contractor personnel refusing the
mission, they also have the obligation to supply somebody
according to the timetable we have to perform that mission. I
have actually had personal conversations with the heads of
several of the private security contractors who provide those
kinds of services, such as KBR, Inc., which has the Logistics
Civil Augmentation Program (LOGCAP) contract, to query whether
this has at any time been a problem or looks like it could be a
problem. We are getting strong, consistent assurances that with
our reliance on the individual company to provide the personnel
required, they do not anticipate any problem in that regard.
Senator Akaka. Well, thank you very much. Thank you for
your responses.
Mr. Chairman, I have a statement that I would like to be
included in the record in the proper place. Thank you.
[The prepared statement of Senator Akaka follows:]
PREPARED STATEMENT OF SENATOR AKAKA
Thank you, Mr. Chairman, for holding this important hearing.
I have made it a point over the past year to take a close look at
government contracting for goods and services. At several hearings with
both in this Committee, and in the Armed Services Committee, a pattern
of insufficient contract oversight and poor execution has emerged. In
too many cases, contracts are awarded hastily with not enough Federal
employees overseeing them, putting the government at risk of waste,
fraud, or abuse.
In particular, I have been concerned about hiring contract workers
to fill gaps in the Federal workforce. Agencies across the Federal
Government rely on contractors to fulfill critical government
functions. Alarmingly, many agencies don't even know how many
contractors are working for them, side by side with Federal employees,
at any one time.
The Federal Government has all too often passed off the job of
managing contractors to the contracting firms themselves. There are
currently no consistent standards across agencies that say who can be a
private security contractor or how they should be managed. Different
contract security firms conduct different levels of background checks
and have different hiring standards.
The legal status of many contractors operating outside of the
United States needs to be clarified. The law is ambiguous at best as to
how private security contractors are treated when they break the law in
foreign countries.
For the foreseeable future, private security contractors will need
to be used abroad. Our dependence on them can not be ended quickly, but
we can do more to ensure better oversight and management. Reforms are
needed to make sure that the Federal Government is using private
security contractors appropriately and that they are well suited to
work for the Federal Government.
I am a cosponsor of the Security Contractor Accountability Act
which would clarify the legal status of security contractors overseas
to ensure that they are accountable for their actions. However, the
legal status of contractors is only part of the problem. Perhaps even
more importantly we must institute standards for private security
contractors to ensure that they behave appropriately in the field.
This Committee has an important role in reforming contracting rules
conducting oversight. Contractors should be held to the same high
standards as our outstanding Federal workforce. Even though contractors
overseas are not government employees, it is essential that their
actions reflect well on the United States.
Chairman Lieberman. Thank you very much, Senator Akaka.
I would like to return to a few of the questions that I
raised at the outset, regarding the kind of functions that
private security contractors are performing now. They have been
involved in so many shooting incidents, and I am assuming, for
the record, that those are justified incidents of shooting. But
I wonder if the distinctions that we are making that we
discussed earlier, Mr. Bell, between defensive and offensive
operations really are relevant in that sense. I will start with
Ambassador Kennedy because I did not have a chance to ask him
about this. The security contractors from the Department
obviously are often assigned tasks or sent into areas that put
them at high risk of being engaged in the use of force. And I
know you spoke to this issue somewhat in earlier comments, but
I want to ask you if you would address the validity of the
distinction between defensive and offensive security.
Mr. Kennedy. Clearly, Senator, we ask our security
contracting professional colleagues to engage in dangerous
activities.
Chairman Lieberman. Right.
Mr. Kennedy. During calendar year 2007, in Iraq--this is in
both Baghdad and other locations where the State Department
uses personal security contractors--we asked them to run over
5,648 missions. There was a very small percentage of those
missions--I will calculate that and get it to you--where there
was escalation of force and actual shooting. So the numbers are
relatively small, but they have been deadly over the years.
During the course of the existence of the American Embassy in
Iraq after it was turned over to the State Department from the
CPA, two State Department Foreign Service security officers,
government employees, have been killed, and 28 colleagues from
the contract security forces have been killed as well. So this
is inherently dangerous.
Chairman Lieberman. Yes.
Mr. Kennedy. However, their actions that they take are
entirely defensive. They do not fire unless they are approached
and encroached into the zone, and then they go through a very
specific and laid-out rubric, flashing lights, hand signals,
large placards on the back of the trailing vehicle. So we have
very specific rules of engagement that say you do not fire. And
then as the next to the last resort, you fire shots into the
engine body of the vehicle that is encroaching on you to
attempt to disable the vehicle, and only then as a last resort
do you fire into the cabin or the body of the vehicle.
So it is a dangerous environment, but the percentages are
relatively small, where escalation of force and actual shooting
occurred but the number of missions, as you can see, is very
large, over 5,600 in 1 year.
Chairman Lieberman. Mr. Schmitt, let me ask you to get into
this from the contractor's point of view. Is the distinction
between offensive and defensive actions is a meaningful one?
And, parenthetically--I know the parent company of ArmorGroup
is British--I'd like to know whether, from your own experience
whether the British Government system, both for hiring
contractors and for describing responsibility once hired, is
different from our own.
Mr. Schmitt. Certainly, Senator. Clearly, the British
Government took an early lead on this, even, I would say,
earlier than we did, in really about 2004.
Chairman Lieberman. Meaning the use of the contractors or
in rules to govern the use?
Mr. Schmitt. The use and the rules themselves for the
employment of the contractors. It is an essential question on
the rules of force, which are different than rules of
engagement, actually, and as the Under Secretary described,
there is a whole series of procedures and actions that do
occur.
We believe that the most essential thing is that you train
individuals prior to employing them on these tasks so that
there is no question of how to de-escalate when you have a
situation. Much can be determined on how a contractor is
perceived by the local population.
I will give you an example from my own experiences in
Hurricane Katrina. I was deployed immediately upon landfall of
Hurricane Katrina to set up our support for the de-watering of
the city, and the thing that I felt was most important was the
type of weaponry that we would use. We chose to use--and it was
very dangerous, very lawless at the time--only shotguns, not
rifles.
Now, you may ask, it is still a firearm, but the
distinction in how it looks and how it is perceived by the
local population makes all the difference. And the same is true
in Iraq, and we believe that if you train individuals
appropriately before placing them in the situation, you can do
much to avoid the incident to begin with--not always. Sometimes
you have to actually escalate very quickly to the rules of
force where you may have to engage to protect life or limb.
Many times you can avoid it.
Chairman Lieberman. So do you think the existing defensive/
offensive security distinction that our government is following
is a meaningful one?
Mr. Schmitt. I do, Senator, and I think it is essentially
important that we clearly state as a government and as a
country that we only allow private security providers to
provide defensive work. Private security providers are not
agents of the U.S. Government. They are contractors.
Chairman Lieberman. Right. Thank you. My time is up.
Senator Collins.
Senator Collins. Mr. Bell, I want to refer to a December
2006 GAO report that is entitled ``High-Level DOD Action Needed
to Address Long-standing Problems with the Management and
Oversight of Contractors Supporting Deployed Forces.'' There
were a number of recommendations in the report. One is that DOD
had such limited visibility over contractors because
information was not aggregated, and as a result, senior leaders
and military commanders could not develop a complete picture of
the extent to which they could rely or did rely on contractors
to support their operations. And the GAO went on to give an
example of a base consolidation plan that DOD officials were
unable to determine how many contractors were even deployed to
bases in Iraq.
What is the current status in terms of DOD's visibility
over contractors? This report is about 14 months old now.
Mr. Bell. Thank you, Senator Collins. The report itself,
even when it was issued, was somewhat dated, and I have had a
series of conversations with Bill Solis about this. Let me give
you the current status of those arrangements.
First, as I mentioned earlier, we are in the process of
implementing now a system we call SPOT, which actually will
identify every DOD contractor who comes on a military base, and
we will know where they are on the base--if they come to a
dining facility, medical care facility, or when they leave the
base. So we can actually identify and aggregate the statistics
regarding the individual contractor personnel.
Equally important, we have put into place in October of
this last year the authority that all contracts and task orders
that are going to be implemented in Iraq or Afghanistan must be
pre-cleared by the Joint Contracting Command for Iraq and
Afghanistan, so that not only do we know about the individuals
who are transiting and moving around our AOR, we actually know
what contracts are being implemented. This was not the case
prior to that effort of putting the Joint Contracting Command
Authority in place and as we implement the actual SPOT system,
as we call it, for tracking the personnel. So we have about
75,000 contractor personnel and contracts in the system already
that is being fielded today. The State Department is pilot
testing that for their own personnel for contractors. So we
believe by this summer that the combination of having the Joint
Contracting Command oversight of any contract to be implemented
there as well as the actual ability to track individual
contractor personnel and their movements will give us that kind
of information.
Senator Collins. Thank you.
Another concern that GAO raised about the oversight of
contractors is that DOD did not have sufficient contracting
officers in-country. I know from my many briefings with the
Special Inspector General for Iraq Reconstruction that he
believes this is still a problem. Similarly, Ambassador, with
the State Department, the October 2007 report found that there
was not sufficient State Department contracting officers in-
country. There is a very startling statistic that my staff
found that in 2003, USAID had only four employees to oversee
its Iraq contract work.
What is the status of your efforts to ensure that there is
sufficient DOD acquisition personnel? I will start with you,
Mr. Bell, and then the same question to you, Ambassador.
Mr. Bell. Thank you again, Senator Collins. The Secretary
of Defense asked me to do an assessment for him in September
about how effectively we were managing contractors, addressing
the whole range of operational and contract management
activities. At that time, I recommended to him exactly what you
have indicated here, that we need to substantially strengthen
both the staffing and contracting authority of the Joint
Contracting Command as well as significantly increase the
amount of DCMA post-award contract administration.
Subsequent to that, he has approved all those
recommendations. We are in the process of adding 48 people just
to the Joint Contracting Command as contracting officers. We
have already put 100 additional DCMA personnel in. We have
another 150 that are going in before the end of March. That
meets the short-term need.
The long-term need is one we have to address, which is the
need to enlarge the civilian and military contracting
capability and personnel force that we have available to deploy
to support post-award contracting activity. That is a long-term
problem. The Gansler Commission has some important
recommendations regarding the need to strengthen that,
particularly not only to train the people but to career-path
them so we have appropriate levels of experience, both in
contracting in general, but particularly in contingency
contracting.
Senator Collins. Thank you. Ambassador Kennedy.
Mr. Kennedy. Senator, the State Department approaches the
problem slightly differently. We do not do major contracts in
Iraq. In order to reduce the number of people at risk and make
sure that we have the most robust contract oversight, all of
our major contracts are written, negotiated, and executed in
Washington by our contracting professionals here. So that is
why we do not have as many contract executors there. What we
do, though, in parallel to Defense, is we have contracting
officer's representatives. For example, every Diplomatic
Security special agent who is being assigned to Iraq now
receives a 40-hour course on how to ensure that they enforce
the provisions of the contract. We have contracts for
telecommunications and so our information management
supervisors there provide the oversight of the contract and
refer any questions back to Washington. The same with our
facilities and the same with our logistics.
So we have the contract officer's representatives there who
are professionals in the field that they are overseeing and
they then refer questions or doubts about it to our central
headquarters in Washington where the contract was negotiated
and where there is the solid expertise on that. And that
reduces the number of personnel at risk while at the same time
maintains a robust oversight of the execution of the contract.
Senator Collins. I will tell you, Ambassador, based on the
discussions that I have had with Stuart Bowen, if you do not
have the contracting officials in-country, you have a lessening
of accountability and oversight. I realize the negotiation can
be done in the safety of Washington, but look at all the
terminations for convenience of the government that we have
seen in Iraq when they really should have been terminations for
default. And it is because you do not have the people on the
ground. I think nothing substitutes for that on-site oversight.
Mr. Kennedy. Senator, I have read Mr. Bowen's reports. I
fully agree with you for those kind of contracts, but those are
not the kind of contracts that are within my jurisdiction.
Developmental contracts are the purview of the Agency for
International Development. The one division that we have out
there, the Bureau of International Narcotics and Law
Enforcement that does various kinds of training, they do have a
robust staff. I believe they are up to 11 contracting people
overseeing that.
I will be glad to get that data, but I fully agree with
you, but it is the distinction of the type of contract that we
use versus the kind DOD uses or the kind the Agency for
International Development or some other body that is doing
developmental work as opposed to internal operations
contracting.
Senator Collins. Thank you.
Chairman Lieberman. Thank, Senator Collins. Senator Tester.
Senator Tester. Yes, thank you, Mr. Chairman,
As I alluded to earlier, I think that any time taxpayer
dollars end up unnecessarily in the contractor's pockets
instead of going to support the troops in terms of body armor,
vehicles, bullets, or just general overall support, I think it
is a travesty. And I think it is our job to make sure that any
fraud or abuse that happens does not happen.
Along that line, Mr. Kennedy, in 2004, there was a
Worldwide Personnel Protective Services (WPPS) contract
awarded, which you alluded to earlier, for $332 million to
Blackwater. Two years later, Blackwater received for that
contract $488 million, over $150 million more than what the
contract said.
Was that contract competitively bid in the beginning?
Explain to me why Blackwater would underbid a contract by that
much.
Mr. Kennedy. Senator, the original Blackwater contract to
provide protective security operations in Iraq was awarded by
the Department of Defense in 2003. When the U.S. Embassy was
stood up on relatively short notice in 2004, there was a brief,
sole-source award to Blackwater by the State Department.
Senator Tester. And that was this contract?
Mr. Kennedy. The original one. However, the State
Department was then in the process of awarding what we call the
Worldwide Personnel Protective Security contract. That pre-
qualified companies, and there were three companies that won as
being certified: Triple Canopy, Blackwater, and DynCorp. Then
we post task orders to that contract that say we want you to
bid now among the qualified firms for this particular task
order. And then the three companies bid on that.
Senator Tester. It was competitively bid?
Mr. Kennedy. Yes, sir. And then the task orders are
competitively bid. However, if during the period of the
contract running for the year, if circumstances greatly change
on the ground and we need additional PSCs, because of increased
danger or expanded presence.
Senator Tester. And that is the case?
Mr. Kennedy. We then amend the task order, but they are
paid the same rate that they won the bid on.
Senator Tester. So Blackwater billed the State Department
$1,222 a day for their employees, which was about $445,000 a
year, which is well above the poverty line and well above what
you pay our soldiers in the field. Is that typical?
Mr. Kennedy. I hate to say it, Senator, but that is the
competitively bid going rate, yes, sir. We competitively bid
the contract, and we take the best price and best value. And it
is what it costs these days----
Senator Tester. And this is cost-effective rather than
going with our active military to provide the support we want,
to have control over, and as Senator McCaskill said, to be able
to work our forces so everybody knows where they are at and
integrate what is happening. That is cost-effective?
Mr. Kennedy. Two things on that, Senator. When I was a
member of the Secretary's special panel, I interviewed every
senior U.S. military officer in and around Iraq from four stars
to one star.
Senator Tester. Yes.
Mr. Kennedy. And I said if the State Department stopped
using contractors to provide the protective security
operations----
Senator Tester. Yes.
Mr. Kennedy [continuing]. For diplomatic activities there,
do you, DOD, have the resources and the troops to take on the
mission? And the answer was 100 percent uniformly, ``No.''
Senator Tester. I do not doubt that a bit, but shouldn't we
step up our efforts to make the active military more suitable
because we are at war?
Mr. Kennedy. That, Senator, is a question that I do not
feel qualified to answer.
Senator Tester. OK.
Mr. Kennedy. But if I might, one other thing.
Senator Tester. Yes.
Mr. Kennedy. We have vetting procedures. We run through a
complete schedule to make sure that we are getting everything
that the taxpayer has paid for under the terms of those
contracts.
Senator Tester. I understand, but if the bar is set at
$1,200 a day, that is pretty incredible from my perspective. I
mean, it is truly incredible.
Mr. Kennedy. That is, of course, Senator, you realize, a
fully loaded cost where they are providing the housing, the
meals, the transportation.
Senator Tester. Are you sure about that? When I went to
Iraq, the folks who guarded me--they did a very fine job, I
might say--were contractors and ate in the same barracks
everybody else ate in.
Mr. Kennedy. No, sir. If you went to Baghdad, you were
protected by the Regional Security Office which uses
Blackwater.
Senator Tester. Right.
Mr. Kennedy. There is a Blackwater camp where they sleep.
There is a Blackwater dining hall where they eat. And their ID
card does not entitle them----
Senator Tester. That is amazing.
Mr. Kennedy [continuing]. To services in the Defense mess
hall, which the State Department pays for independently.
Senator Tester. All right.
Mr. Bell. If I could, Senator Tester?
Senator Tester. Yes.
Mr. Bell. What you may have observed is they were on duty
providing protection to you, which requires them to be in
proximity to you when you have your meals.
Senator Tester. OK. All right. Could you give me any kind
of ballpark figure--and I know I am running out of time rapidly
here. But of the $70 billion we just appropriated for Iraq and
Afghanistan, what percentage of those dollars that you get will
be used for contracts across the board, not just PSC but all
contracts? Just give me an idea. And if you cannot, you can get
back to me with what that amount might be.\1\
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\1\ See Mr. Bell's response to question for the record, which
appears in the Appendix on page 147.
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Mr. Bell. I would like to take that as a question for the
record because I think you deserve a good, specific answer on
that.
Senator Tester. That would be fine, yes.
Mr. Kennedy. I have a ballpark figure. I would say in Iraq
it is about $400 million a year. But let me provide you with an
exact figure for the record, Senator, because that would allow
me to make sure I encompass all the costs, including the
Northern portion and the Southern portion.\1\
---------------------------------------------------------------------------
\1\ See Mr. Kennedy's response to question for the record, which
appears in the Appendix on page 120.
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Senator Tester. That would be good. I know the contractors
do a good job because I saw them. The ones I dealt with did a
good job. But one of the things, I think, that the American
public does not understand and why red flags go up on a
contractor is because we think we have 150,000 or 170,000
troops in Iraq. Well, we are paying for twice that many. And as
you said earlier, Mr. Bell, only 17 percent are Americans, but
we are supporting twice that many troops in Iraq. I know the
militaries went down from 3.3 million to 2.2 million, and I do
not doubt that. But this policy decision was made, and I just
do not know if I quite agree with it, to be honest with you,
from my perspective. And we can debate that some other time.
Thank you very much.
Chairman Lieberman. Thanks very much, Senator Tester.
Thanks for your participation in the hearing.
I would note the presence of the distinguished Senator from
Delaware, Senator Carper.
With apologies to the witnesses, I am going to turn the
gavel over to Senator Akaka because I have to go to the Senate
floor. So he will decide who winds this up. I want to thank the
witnesses. You have been very constructive, and I appreciate it
a lot.
The hearing record will remain open if you want to submit
additional testimony for at least 15 days, and we may want to
submit questions. Some of you have made suggestions here that I
would like to invite the others to comment on, particularly
Professor Dickinson's suggestions.
The Committee thinks there is a need to legislate here, but
obviously we want to do it thoughtfully and only as necessary.
So your input will remain very important to us.
I want to say finally that Senator Levin wanted to be here,
but has been unable to get away from a very important hearing
of the Senate Armed Services Committee. He asked me to thank
the witnesses on his behalf and to indicate that he will have
questions to ask you for the record, so you have something to
look forward to when you leave the hearing.
With that, I thank you and turn the gavel over to the
Senator from Hawaii.
Senator Akaka [presiding]. Thank you very much, Mr.
Chairman.
Mr. Bell, subcontracting has been an area where there have
been questions. In a letter to Chairman Henry Waxman of the
House Oversight Committee, the Department of Defense found that
prime contractor KBR, Inc., had subcontracted for private
security under a dining and facilities contract. At the time,
the Department had no idea such a subcontract had been put into
place by KBR, Inc.
Does the Federal Government have authority over these
subcontractors? Or must we rely on prime contractors to oversee
them?
Mr. Bell. We have the authority to specify the deliverables
under a performance contract, and IDIQ contract, which KBR,
Inc. has under LOGCAP. They were specifically prohibited from
providing security services under that contract, but were
authorized to subcontract that out to qualified security
companies should the need be determined to do that. So in this
particular case, I am not sure of the specifics it was
responding to. I am sure that what happened is that they found
a need, given a deteriorating security situation, to get
security contract protection for that facility and did that
through a subcontract.
Senator Akaka. I see. So my question was whether the
Federal Government has authority over those subcontractors?
Mr. Bell. We do have authority over all subcontractors. We
even have authority over contracts where the services and the
goods have not yet been turned over to the U.S. Government, and
we are exercising, for example, jurisdiction over private
security contractors on deliveries that have not yet changed
ownership to the U.S. Government.
Senator Akaka. Thank you, Mr. Bell.
Mr. Kennedy, Homeland Security Presidential Directive 12
(HSPD-12) requires that all Federal employees and contractors
have a common proven identity card (PIV), which requires a
background check. According to the Department of State website,
due to difficulty in conducting background checks for many
overseas employees, you do not expect to implement PIV cards
for everyone until 2011 because of your many overseas employees
and contractors.
How many private security contractors working for the
Department of State have obtained PIV cards and undergone the
mandatory background check?
Mr. Kennedy. Senator, every single direct personal services
contractor protective agent is an American, we only employ
Americans for those jobs. When the contractor proposes the
individual to us, we vet that individual. We check their
credentials. In the beginning, they already must be an
honorably discharged U.S. military veteran or someone with
Federal, State, or local law enforcement experience. Then we
run a security check on them under all the relevant U.S.
Executive Orders and bring them up to the Secret security
clearance level. So every one of our American employees is
fully cleared and has a Secret security clearance among the
contractors.
For our contractors who are non-Americans--and we only use
those individuals as static guards--not any of the movement
security professionals that you may have seen if you have been
in any one of the State Department threatened posts, as I know
you have. For static guards, support personnel, cooks,
cleaners, maintenance personnel, and others, we run every
single local check that is possible under the State
Department's rubric and the State Department's liaison with the
intelligence community and other law enforcement.
The problem that HSPD-12 causes for the State Department is
that you can run all the checks that they want on Americans,
but you cannot run them all to the same degree on local
employees, which is why we do not give third-country nationals
or locally engaged staff security clearances, and HSPD-12
drives that.
So there is an important distinction there, but in terms of
the security professionals we hire for convoy and movement
security, they all, sir, have a full U.S. Government Secret
security clearance and the appropriate suitability checks that
go with it.
Senator Akaka. Well, thanks for the distinction. Let me ask
Mr. Bell the same question.
Mr. Bell. As you know, Senator Akaka, we use both U.S.,
third-country nationals, and foreign nationals for our private
security contractors. Our requirements under the rules we have
at DOD and certainly the rules we have with the multi-national
force over in Iraq and Afghanistan require that background
checks must be completed and security clearances must be
provided. We use, obviously, Interpol and the FBI; we use U.S.
embassy facilities if they are third-country nationals. And any
investigation of local records from their city or province of
origin are also checked to make sure they have no criminal
records.
To the extent they have been in the United States,
obviously, we check to make sure that they have not been
convicted of any crime that would prohibit them from being
armed and, in fact, that they have no other criminal
investigation against them. So we do conduct, particularly on
private security contractors, very thorough background
investigations.
Senator Akaka. Well, thank you. I really appreciate your
responses. You have been helpful to the Committee. What we have
put into the record now will certainly clarify and explain some
of the questions surrounding this important issue.
So, with that, I want to thank Mr. Kennedy, Mr. Bell, Mr.
Schmitt, and Ms. Dickinson for being here today and being part
of this hearing. This hearing is adjourned.
[Whereupon, at 12:10 p.m., the Committee was adjourned.]
A P P E N D I X
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