How infighting in Ministry of Defence makes financiers laugh at them, but does not remove suspicions of promoting one supplier
Two weeks after the Cabinet of Ministers handed over 23 billion to the State Border Guard Service for the purchase of ammunition from a particular company, the Ministry of Defence has finally decided to explain why it did so. Allegedly, so that this money would not simply burn up by the end of the year. Censor.NET investigated whether this is true.
For several months now, the ministry has been engaged in a non-public, but also undisguised confrontation with the head of the Defence Procurement Agency, Maryna Bezrukova, which could have catastrophic consequences for the state's defence capability.
Bezrukova was appointed to the position of Director of the DPA in January 2024. She moved here from "Ukrenergo", where she was a member of the board and also the chief procurement officer. It is not a big secret that her appointment was supported by representatives of NGOs.
Initially, the ministry presented Bezrukova's appointment as a victory: the specialist, who had received awards for fighting corruption risks at "Ukrenergo", was supposed to fix the work of the Agency after Volodymyr Pikuzo's leadership, when the agency showed nothing special.
Bezrukova did start working. But quite unexpectedly. At the end of January, she asked the relevant deputy defence minister, Dmytro Klimenkov, to stop his freelance adviser, Bohdan Yarov, from visiting the DPA and telling them what to do and buy.
By the summer, Bezrukova was already being described in the ministry as unsystematic and unclear about what she was doing.
And in the autumn... you have already know this story well, because first, in September, Bezrukova was attempted to take away the procurement of drones (for which they planned to create a third agency), and then to eliminate the DPA altogether by merging it with the SLO. Under the sauce of NATO requirements. Then there was a small scandal, because NATO suddenly claimed that it had not demanded anything. And the process of merger began.
But not a conflict.
And its next round occurred on 29 November, when UAH 23 billion was taken away from the DPA and transferred by a decision of the Cabinet of Ministers to the border guards, who, in turn, made a purchase from a specific Polish company.
The following week, the Defence Procurement Agency made an official statement that it had contracts that could have been used for the 23 billion.
"The DPA planned to use these funds to finance government contracts already prepared for the purchase of critical ammunition. These contracts provide for an advance payment of no more than 50% of the transaction amount. In view of this, in early December, the DPA planned to take on budgetary obligations in the amount of UAH 23.8 billion and use all the budgetary funds allocated to the Agency for the implementation of programmes for the purchase of weapons and military equipment," the DPA said in a statement.
It also notes that "the Agency has repeatedly informed the Ministry of Defence of Ukraine about the availability of drafts of these contracts".
"The vast majority of this ammunition has already been inspected, and export licences have already been issued for some of it. For the rest, licences should be obtained in the near future. The agency makes advance payments only if the supplier has an export licence, which can take weeks or even months to obtain," the statement said.
Since the transfer of money caused a significant outcry from civil society, the SBGS immediately issued a statement asking "not to speculate" and assuring that it had made such purchases before.
Last Friday, the State Border Guard Service made another statement, assuring that this was not the first time they had received funds for the purchase of ammunition and that they were properly checking the supplier.
"This is evidenced by the relevant contracts signed for the needs of the State Border Guard Service, as well as two decisions of the Cabinet of Ministers this year to delegate authority for relevant procurement for the needs of the Defence Forces in the amount of UAH 5.8 billion and UAH 31.1 billion," the statement said.
The State Border Guard Service also assured of the supplier's reliability.
"The intermediary firm that submitted the proposal is NATO-certified. It has many years of experience in the market. It has been cooperating with the State Border Guard Service of Ukraine for 3 years. It is a reliable supplier. It has no outstanding contracts with the SBGS or delays in the delivery of goods," the statement said.
However, in two weeks, the State Border Guard Service has not responded to Censor.NET's request for comment on whether the SBGS had alternative offers from companies other than the Polish company "PHU Lechmar".
And this is very important, because the company's offer includes a 100% subscription.
According to public data, "PHU Lechmar" Sp. z o.o. is a company located in Poland and headquartered in Warsaw. It operates in the "Other retailers" sector. The company was founded on 22 October 2004. The total number of employees currently ranges from 21 to 50. In 2023, the company reported a 473.33% increase in net sales revenue. Its total assets increased by 988.04% over the same period. The net profit of "PHU Lechmar" Sp. z o.o. decreased by 1.44 % in 2023.
In addition, the company has not often submitted proposals directly to the Ministry of Defence. According to a response to a request from MP Yaroslav Zhelezniak, there have been only four such proposals since the full-scale invasion. Among them is the one with which a contract was signed, but the company did not fulfil it. In addition, there is also a proposal from "PHU Lechmar" for "Gvozdika", which the DPA is currently considering and has sent the company a request for clarification.
What about the Ministry of Defence, you may ask? The Ministry of Defence was silent for two weeks. Perhaps they were hoping the money would be forgotten.
However, last Saturday, the Ministry did make a statement.
The Ministry of Defence noted that the decision to redirect funds for procurement through the State Border Guard Service was made at the Supreme Commander-in-Chief's Office.
"At the end of November, there was UAH 102 billion on the accounts of the DPA. The amount of outstanding budgetary obligations was UAH 45 billion, and unpaid under the concluded contracts was UAH 57 billion. This created a risk that part of the funds will not be used to meet the needs of the Armed Forces of Ukraine until the end of the budget year," the Ministry of Defence said.
And now let's look at how the situation looked like on 4 December after the money was transferred. UAH 283.2 billion was allocated from the budget of the Armed Forces for the purchase of weapons. Of this, 282 billion was contracted.
Then what 57 billion are we talking about?
The point is that after scams like the "Lviv Arsenal" contract, the Ministry of Defence began to move away from the vicious practice of giving an advance of 97% of the contract amount every time.
For example, according to a request from MP Yaroslav Zhelezniak, there are only 13 such contracts at the DPA.
Instead, the practice of paying on a first-come, first-served basis will be applied starting in 2022.
That is, the annexes to the ammunition supply contracts contain a plate with delivery dates. Usually, it is 5-7 turns.
Payment is made for each batch delivered.
This is the same practice used by the DPA. You will agree that this is logical.
As a result, the DPA does have unpaid 57 billion. This money is not in Bezrukova's drawer - it is being held by the State Treasury.
Theoretically, the unused money at the end of the year should indeed be returned to the state. And then be re-allocated to the DPA.
What does the story with the border guards mean? Yes, if they sign a contract, the money will come out of the Ukrainian budget this year because of the 100% prepayment.
But according to the offer, our military will receive the weapons only in early 2026. It is worth noting that the price proposed by the Poles is basically market-based. But, most likely, if they had submitted an offer through the DPA, they would have had competitors who might have offered to bring the goods earlier for the same price.
Moreover, the Poles include new ammunition in their proposal, which will be partially produced in 2025.
And what is the 102 billion left in DPA, according to the Ministry of Defence?
And this is something that, according to the author's sources, has been laughing at the Ministry of Finance for months. Because the Ministry of Defence now has football experts overseeing the finances, and they obviously have not been told that you cannot simply add up the figures from different columns and say that it is one and the same. Even if we are talking about the head of the DPA, whom someone really wants to fire.
That is, after 2 weeks, the Ministry of Defence has not provided a proper response that would convince the public that their decision will improve the supply of weapons to the army, and all communication only reinforces the impression that the money was specifically withdrawn for one company.
Tetiana Nikolaienko, Censor.NET
