The state-owned enterprise's general director, "State Rear Operator" Arsen Zhumadilov, declared the distortion of his department's work in the information space.
What is wrong with coverage of the work of the state-owned enterprise "State Rear Operator" (SRO)
According to Zhumadilov, caring people send him links that record unhealthy attention to his person, expressions, origin and appearance.
He also declared a wave of information distortion of the newly established enterprise.
I am clearly aware of why this wave has gone. And she is far from the last. Why so? For me, there is no other priority than meeting the needs of our warfighters by building a capable supply system. Not the interests of suppliers. Not the interests of officials. Even if they wear epaulettes. If the interests of suppliers coincide with this priority, then it is great. If the interests of officials coincide with this priority — great, Zhumadilov notes.
What is known about problems with corruption in the field of defense procurement
He noted that, in general, Ukraine spends about UAH 90 billion a year on contracts for the rear support of the military and offered to imagine the amount of money earned through non-transparent tenders.
The general director of the state-owned enterprise "State Rear Operator" also responded to the accusations levelled at him regarding the formation of a personal team within the enterprise, bloated staff, lack of transparency of the financial model, interest in overstating purchase prices, intentions to deviate from NATO standards when purchasing food for the military and others.
Zhumadilov emphasized that the omissions are made on purpose and distort the work of the state enterprise.
He noted that he is assembling his team, but it consists of professionals who are carefully selected for integrity, industry knowledge, and the ability to cooperate effectively.
He says the critical selection criteria are zero tolerance for corruption and professionalism.
Regarding objections to the allegedly bloated staff, Zhumadilov emphasized that the department with 70 employees is currently dealing with procurement issues, but there will soon be many more employees.
Horror! Our staffing actually provides for 145 personnel units. Why so? It's very simple because the state operator of the rear will perform not only the procurement function, but will be responsible in general for the rear support of the Armed Forces. Procurement processes (the capacity of the involved structural units — 30 full-time units) are only a part of the institution, which will also perform the functions of contract management, supply chain, incoming quality control, efficiency management, supply management, supply management, claim-lawsuit activity, corruption prevention, financial and security compliance, risk management. I would like to mention IT separately, which will automate both internal processes and our interaction with the outside, ensuring speed, manageability and transparency. You can not do all this. Then the country will continue to watch for years how the army is drowning in papers, how purchases are made every time for the needs "for yesterday" due to the lack of quality work with data, how the signatories of contracts sit in the cells because of bad contracts, how suppliers do not fulfill their obligations without critical consequences . We want something else — systematic work for results. Such work requires personnel resources, Zhumadilov explains.
Regarding the accusations of the financial model's lack of transparency, the head of the "State rear operator" noted that the percentage remuneration model for the purchasing agent is a standard global practice.
It allows you to forecast incomes to cover expenses for the development of the organization. At the same time, the size of the commission itself (which is 0.4%) in our case is smaller compared to similar cases. For example, international organizations in Ukraine take from 4.5 to 7%. Centralized purchasing organizations from 0.5 to 3%. Globally, defense buyers charge 2.5% to 7.5% for their services. So, first of all, the commission percentage in our case is quite low. Secondly, the ceiling of the company's income was set at the level of 250 million hryvnias by the government decree (it is publicly available). for a year. Thus, by means of simple arithmetical exercises, we find that even if the purchaser determines the SRO by hundreds of billions of hryvnias, the actual percentage of the commission fee will decrease with each new concluded contract, Zhumadilov notes.
In response to accusations of interest in selling at inflated prices, Zhumadilov emphasized that the activity is carried out by the legislation on public procurement, with the key criterion being choosing the winner at the lowest price.
He also denied claims that the launch of the agency was blocking procurement.
We will make purchases with the funds of the 2024 state budget. The exception is food, for which the Department within the Ministry buys a three-month need for the first quarter of the next year. Auctions just took place recently. At the same time, according to the appointments within the 2023 state budget, all purchases are carried out exclusively by the Department. The launch of the Agency is a parallel process that in no way affects the current activities of existing structures within the Ministry of Defense and does not block their activities in any way, - noted Zhumadilov.
He also denied cancelling the food catalogue and moving away from NATO standards.
No one is going to cancel the catalog. It will remain the basis for calculating demand and reporting. What exactly will we change? Purchase to meet this need. That is, the approach to entering the system will change — at the exit, the military will have access to a variety of meals. By the way, which is actually not the case in most cases. NATO standards are based on the fundamental principle of transparency in the use of funds for military needs. Currently, there is no such transparency. There is a black box, within which the supplier supplies what is profitable for him, in the volumes that are profitable for him. We will change this. In constant coordination with our international partners from NATO countries who support us, Zhumadilov emphasized.
