MoD plans to finalize the IFV tender very close to the election in October – Czech Republic has bad experiences with such timing

MoD plans to finalize the IFV tender very close to the election in October – Czech Republic has bad experiences with such timing
18 / 03 / 2021, 10:00

The Ministry submits for approval to the Defense Committee a schedule for finalizing the purchase of the tracked Infantry Fighting Vehicles. The schedule shows that the signing of the largest military contract in history of the Czech Republic for tens of billions of crowns can take place at exactly the moment when our governments will change. This can very easily lead to a situation where the contract will be signed, for example, by minister in resignation or minister in a government without confidence. It is this time when power is handed over that is ideal for obscuring the clear responsibility for signing the purchase.

It couldn't have been prepared any worse. The confusing time of the culminating election campaign time is an ideal venue for various lobby groups, which in these times, when there is no clear political responsibility, feel their chance to influence decisions about large expenditures.

Looking at the timetable for the remaining steps, it is clear that the agreements will be signed by the Minister of Defense at best in the week before or after the parliamentary elections. There are not just the tests of functional samples that have been postponed several times, and are currently planned from the end of April to the beginning of June. The simple sum of deadlines set for individual steps speaks for itself: if the tender is to be truly completed in its current form, the Ministry of Defense wants to solve the historically largest arms contract in the independent history of the Czech Republic worth more than 50 billion crowns at the turn of September and October at the earliest.

See also: Acquisition of the IFVs needs a rational reduction and change of format - the tender steps on the spot and blocks funds for important projects

According to the MoD document, these are minimum deadlines and the reality may not correspond exactly to the mechanical sum of exactly six months, there are probably more interpretations. However, the calculation of the date when the tender is to be signed is also confirmed by the ministry itself, which says: "In the second half of this year."

After fifteen years, the principle of implementation is strikingly similar to how it was done during the infamous purchase of Pandur II vehicles. In 2006, the Minister of Defense in resignation, Karel Kühnl, signed it six days after the election, which aroused overwhelming criticism. Subsequent developments required a reassessment of the entire project, as the contract was signed for too many vehicles in terms of budget and the ministry had to reduce the contract in a difficult way. However, if at that time someone tried to lobby the signature with Steyr, he has seen a full success. It was more than clear that Minister Kühnl and the entire government were ending, and he signed a huge commitment without any political responsibility.

Even now, the signing of the contract just before or after the elections will have another crucial dimension: the signing of the contract will put a CZK 50 billion commitment for the purchase of vehicles, along with another CZK 100 billion commitment to service their life cycle. This is particularly risky at a time when the country is going through a severe economic downturn caused by the coronavirus epidemic and measures against it. It is quite certain that the new government will not only have to revise military priorities and adapt them to the real economic framework. However, the signing of such a magnificent agreement would mean that its space for any maneuver would be reduced to an absolute minimum. Expenditure approaching the annual budget of the Ministry of Defense, although spread over several years, will be a burden and will complicate investments in other areas that are equally needed for the Army.

The third very important parameter of the contract and the categorical condition is its routing to the state enterprise VOP CZ. Unfortunately, it is a company that has long demonstrated its inability to manage profitably. According to information from military sources, its technical know-how is significantly reduced and its ability to handle this technologically demanding and extensive order is insufficient.

Today, VOP CZ has basically become a kind of black hole into which the ministry is trying to pour money through state contracts without the desired effect. The last time we witnessed this was the criticized and questioned order for the modernization of old T-72M4 CZ tanks. And given recent information about problems with spare parts for their engines, we will probably get back to it again soon.

See also: The Army will get back only 5 billion crowns and it must wait again for the remaining money

Let's take a closer look at the individual steps of the timetable described by the Ministry of Defense in its document for members of the Defense Committee. Some will probably follow each other, others will take place in parallel and their results will be taken into account when deciding on the final supplier.

Referring to the unfavorable epidemic situation, the Ministry of Defense decided to postpone the testing of functional samples of new IFVs from the end of March to the end of April. They are to last until the beginning of June. Originally, they were to take place at the end of last year (October, November). The tests will be evaluated immediately and the evaluation should take two weeks. Simultaneously with the tests and in connection with their evaluation, further steps will take place, which have their own fixed minimum time limits.

First of all, the Ministry of Defense must invite bidders to submit final bids. This is currently prevented by the unfinished settlement of the objection raised by the Ministry of Trade and Industry to the changes to the contract in the framework of an abbreviated comment procedure (the changes concern the extension of the schedule for supply and financing of the contract). According to a statement from the Ministry of Defense, negotiations between the relevant deputies have been taking place since 9 February. That is more than a month. Once the call can be sent to the tenderers, it will take at least one month for the MoD to receive the final bids. It will assess and evaluate them for another month and a half. This will be followed by six weeks, which will be available to the College of Defense Minister. The solution will be selected, for which the Ministry of Finance will determine the expenditures during the next month. Another one-month period then comes to inform the Government.

If the contract is actually signed, the outgoing government will be signed under the contract for more than 50 billion crowns. This will oblige the new government, faced with a challenge in response to the social and economic consequences of the pandemic, to take further steps without the possibility of revising the status of the project according to the new economic situation. The scandals surrounding the purchase of Pandurs should be a warning to the current government, not a guide on how to proceed.

Tags of article

This website uses to provide services, personalize ads, and analyzing visitor cookies. By using this site you agree.More information