Key US army official slams Bush over Halliburton Iraq contracts

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One of the US Army's top procurement officers yesterday called the Bush administration's grant of multibillion-dollar contracts to oil services giant Halliburton "the worst case of contracting abuse she has ever seen".

Bunny Greenhouse, the Corps of Engineers chief contracting official, said: "It was misconduct, and part of that misconduct was blatant." Her comments, made in an interview on NBC's Nightly News programme, came as US government memos revealed that the Pentagon extended a Halliburton contract for 11 months beyond its expiration, despite warnings that the company was "out of control" in its work providing troop support in the Balkans.

Ms Greenhouse has already demanded an investigation into the contracts that last year were granted to Halliburton, the energy services firm run by Vice President Dick Cheney from 1995-2000. According to her attorney, the FBI has since asked her for an interview on the matter. The bureau has launched a criminal investigation of the work. A spokesman for President Bush on Friday said he expects a full investigation into allegations of wrongdoing in how Iraq-related contracts were awarded to Halliburton.

Company spokeswoman Wendy Hall said earlier this week: "The old allegations have once again been recycled, this time one week before the election." Ms Greenhouse said she was not trying to influence the election. But she also questioned the Pentagon's waiver of rules requiring Halliburton to justify pricing for services after a government auditor found the company may have overcharged by $61m for fuel. "It all favoured Halliburton," she said.

Halliburton, which is already under investigation for overcharging for work in Iraq, has been a target of Democratic criticism ahead of Tuesday's election, with suggestions the Texas firm got special treatment because of Mr Cheney. Ms Greenhouse vowed she was not alleging any impropriety by the President or Vice President. "None whatsoever," she said.

As far as the Balkans is concerned, Ms Greenhouse complained to Lt Gen Carl Strock, commander of the Army Corps of Engineers, that it should not have halted plans to let companies compete for a successor Balkans contract. Corps officials initially justified stopping bidding by concluding that a "compelling emergency" would exist if Hallibur- ton's work was interrupted.

But when she challenged the justification and sought an explanation of the emergency, Corps officials changed their reasoning. The new explanation was that Halliburton subsidiary KBR was the "one and only" company that could do the job.