Ukraine needs extra lines of defense to ensure that public money is used effectively during the war and to secure the integrity of reconstruction funding after the war, according to a conference at Press Club Brussels Europe last week.
The first line of defense is the institutional framework of anti-corruption and audit agencies. The other line of defense is civil society and investigative journalism which is active in the middle of the on-going war.
This was the main conclusion of a conference (14 March) organized by the Centre for Financial Crime and Security Studies (CFCS) at RUSI Europe. It is an international NGO which has launched a project on strengthening the financial monitoring capabilities of Ukraine’s reconstruction funds by empowering civil society.
The conference gathered anti-corruption activists, EU policymakers, civil society organisations and journalists and focused on how to strengthen the institutional framework of Ukraine’s reconstruction and the role of investigative journalism in ensuring transparency.
Ukraine will need a massive injection of funds to for the reconstruction once hostilities cease. This will require proper mechanisms and expertise to ensure that these funds are not being mismanaged. For the Ukrainian reconstruction to succeed, international donors need trust, which can be reinforced by ensuring that civil society has a seat at the table.
Viktor Nestulya, head of Ukraine’s Support at Open Contracting Partnership, highlighted that most successful Ukrainian reforms have been implemented in close cooperation between the government, civil society, businesses and international partners – the reconstruction efforts should be no exception.
An official at the European Commission underlined that beyond anti-corruption measures, Ukraine needs a comprehensive control environment, including strong internal and external auditing systems and control mechanisms.
The supreme audit institution (SAI), the Accounting Chamber of Ukraine (ACU), will play a crucial role in promoting accountability and transparency, including the fight against corruption, but is still struggling with building up its audit capacities during the war. Nestulya told The Brussels Times that the ACU has started to receive technical assistance from other SAIs.
As previously reported, grand corruption and state capture were still widespread in Ukraine before the war despite EU support for anti-corruption legislation and agencies, according to a special audit report by the European Court of Auditors (ECA) in September 2021. EU has long been aware of the connections between oligarchs, high-level officials, politicians, and state-owned enterprises in Ukraine.
Less influence for oligarchs
However, the role of the oligarchs in society has changed since the outbreak of the war according to the participants at the conference. While pro-Russian oligarchs have been arrested or expelled, other oligarchs are contributing to the war effort.
“They have much less influence in Ukraine now since the war started,” said Alisa Yurchenko, an investigative journalist and editor of Bihus.Info. “The oligarchs have also lost assets during the war because of the Russian bombardments.” She has been monitoring the activities of the oligarchs and their influence on state assets since 2014.
One of her first projects was the digitization of declarations made by officials who had served under the previous president Yanukovych who was removed from his post during the Revolution of Dignity in 2014 and fled to Russia. The officials were suspected of being corrupt and had to undergo checks (“lustration”). A network of volunteers uploaded the handwritten declarations in a database.
Overall, she was satisfied with the access to public data in Ukraine and mentioned in particular the government digital portals on the state budget and public procurement.
Reactions to investigative stories
Anna Myroniuk, head of investigations at Kyiv Independent, stressed that Ukrainian journalists play a key role in preserving democracy and ensuring the oversight of public funds during the war. Kyiv Independent was founded only three months before the war, after the owner of Kyiv Post, the oldest English-language newspaper in Ukraine, had started to interfere in the reporting of the journalists.
“We do both front-line reporting and investigative journalism on suspected mismanagement by the government and the military,” she explained and referred to her latest story in collaboration with media partners about leaked documents that exposed a Russian plan to undermine Moldova.
The most known investigative story until now deals with the inflated prices in the contracts for the supply of food to the army. In its first reaction, the ministry of defense dismissed the figures as technical errors. The minister even hinted repercussions for those who had leaked the contract to journalists.
Later on, the ministry admitted that the prices were too high and revoked the contracts. The Ukrainian parliament reacted also and amended the procurement regulation.
Can negative reporting about corruption in Ukraine be used by Russia?
The two journalists are aware about this but are certain that Russia anyway will turn all information into propaganda and disinformation. “The issue at stake is to ensure accountability in Ukraine even during the war,” Anna said. “What we don’t do is to disclose the names of places and military commanders.” Alisa added that the reporting aims at saving money and to make a difference.”
They expect the government to react to their reporting and have noted an increasing responsiveness to their investigations although the outcome of the actions carried out by the government was not always known to them because of security reasons.
Ross Higgins, a senior researcher at Bellingcat, highlighted the importance of transparency in identifying shell companies and other ways oligarchs and kleptocrats hide their money. He noted that it will take time for civil society and investigative journalists to identify all assets and companies linked to sanctioned individuals.
He is currently involved in a project mapping thousands of British limited partnerships and off-shore companies with beneficiaries from Eastern Europe and Russia. Another project, launched by the Justice and Accountability Unit at Bellingcat, is developing a methodology for online open-source investigations of war crimes committed by Russia to be used as evidence in future trials.
The Brussels Times