Publication: North Caucasus Weekly Volume: 3 Issue: 10

Over the past week and a half, there have been indications that federal funds intended for the restoration of Chechnya have, as before, been disappearing into a bottomless “black hole.” On March 22, the Associated Press reported that Russian Audit Chamber chair Sergei Stepashin had met the previous day with the pro-Moscow Chechen cabinet of ministers in Djohar (Grozny). Stepashin announced on that occasion that “auditors were investigating reports of the misuse of funds, including double-billing for housing renovations that had already been performed.” On March 29, the newspaper Kommersant revealed that “the program for the restoration of Chechnya is under threat of collapse.” This was stated on March 28 by the head of the “Direction for Construction and Restoration Work in the Chechen Republic,” Anatoly Popov. At a press conference in Moscow, Popov underlined that, at the present time, there are flatly no funds available for performing restoration work within the republic: “Thirty-eight percent of the funds (that is, 980 million rubles),” he recalled, “which had been earmarked for the restoration of Chechnya according to last year’s program were received by the Direction from the funding agencies only on December 28-29 [2001], so that there was no opportunity to use them. In accord with the Budget Code, all unexpended budgetary funds had to be returned to the federal budget, and this was done.” As for the financing of restoration work for the current 2002 budget year, this has not even begun, “even though the first quarter has almost ended.” Popov affirmed that the reasons for “the breaking off of financing” of Chechen restoration work were unknown to him. His office, he said, has yet to receive a single kopeck of the roughly US$96 million promised for this year. “We owe our workers almost 500 million rubles,” he complained (Kommersant and Moscow Times, March 29).

In similar fashion, the March 20-26 issue of Moscow News carried an interview with German journalist Florian Hassel, who had recently completed an investigation into major funding abuses within the pro-Moscow public health system in Chechnya. “Last October,” Hassel related, inter alia, “an audit of the state-owned pharmaceutical company Chechenfarmmedtekhnika revealed that the firm had misused a sum equivalent to 1.5 million euros. I made the rounds of several hospitals and medical centers in Chechnya which, according to documentary evidence, had received large sums to carry out repairs and purchase equipment. I saw for myself that nothing had been done there…. Do you know what astounded me most? The indifference of Russian journalists in Grozny whom we told about our findings. Amazingly, they were not in the least interested.”