Military equipment acquisitions, between real constraints and controversial decisions
Stefan Danila
European regulations on public acquisitions seem to block the military technique and equipment procurement, meanwhile at a community level the idea of a European defence industry is more and more important.
Military acquisitions can be a great engine for the entire national economy. Emigration could be also stopped with creating well paid jobs.
Responsible political decisions, legislation’s completion with a multiannual defence acquisition program for the following ten years, the openness towards high-tech and investment’s ease in key fields can be a forceful foundation for the tenable development of economy and each citizen’s wealth.
Along with a modern education, to emphasize and express personal qualities and abilities, these processes could be the nucleus of Romania’s modernization program.
All political bodies, analysts and influencers are concerned with national security given the ominous condition of the more and more predictable evolution of the current international relations. The political agreement on 2% from GDP for national defence (including expenditures related to pensions and social care that the National Defence Ministry is responsible for) is an important, yet not sufficient, step for creating an effective, tenable and trustable defence capacity to match the current situation.
The Romanian armed forces must acquire equipment, modern armament system as most of the effective ones are long ago morally, some of them even physically, old-fashioned. Developing certain capabilities in national defence is done, across most of the states, starting from a deep strategic analysis. After elaborating this analysis, given the potential threats and the possibilities to combat them, the decisional factors make important decisions, maybe the most important one being the equipment procurement. These decisions are expensive, which involves, also, a great responsibility.
Given these circumstances, but also considering that security and defence were, since its foundation, one of European Union’s pillars, military technique acquisitions have been seen, since 2004, at a community level, as possible exceptions to public acquisitions’ classic procedures, however, in certain conditions. Afterwards, in 2009, the regulations of services and issuing contracts to have works related to defence and security were completed through a new directive.
The protection and encouragement of developing a competitive European industry in defence have determined many actions, from creating OCCAR (Organisation Conjointe de Coopération en matière d'Armement / Organization for Joint Armament Co-operation), a multinational agency with common projects, to the ones coordinated by the European Defence Agency, which had great results, starting with 2014, when the European Council reunited to debate this topic. Then, in 14-15th of December 2017, the European Council marked the official start of the Permanent Structured Cooperation (PESCO), an initiative adopted by 25 of the 28 member states. After some dynamic debates on European defence, new initiatives have emerged, the most important being the creation of European Defence Fund. Romania, through its representatives, was part of the elaboration and approval of these documents. Indeed, two of the directives were actualized in the national legislation, to be then implemented, as always, through an Emergency Directive (although we knew all documents made at community level, since their elaboration!).
Making public acquisitions according to a set of common rules, to show competitiveness in all member states, was reaffirmed after the “Directive 2014/24 UE of the European Parliament and Council from 26th of February 2014 on public procurement” entered into force. Exceptions on certain acquisition are reinforcing the general rules but are also following the interests specific to each state.
In the introduction of the Directive 2014/24, it is mentioned that “Public procurement plays a key role in the Europe 2020 strategy, set out in the Commission Communication of 3 March 2010 entitled ‘Europe 2020”. Indeed, certain acquisitions can be extremely important not just because of their value, but their social impact on the national security field, and in that cases there were accepted the exceptions, however limited: “for public contracts above a certain value, provisions should be drawn up coordinating national procurement procedures so as to ensure that those principles are given practical effect and public procurement is opened up to competition”.
The European acquisition process relied on the fact that
“there is a great need for contracting authorities to have additional flexibility to choose a procurement procedure, which provides for negotiations. A greater use of those procedures is also likely to increase cross-border trade, as the evaluation has shown that contracts awarded by negotiated procedure with prior publication have a particularly high success rate of cross-border tenders”. Also, it is mentioned that “Member States should be able to provide for the use of the competitive procedure with negotiation or the competitive dialogue, in various situations where open or restricted procedures without negotiations are not likely to lead to satisfactory procurement outcomes.”
The need to follow some high-quality standards in order to protect EU citizens was also important: “It should be set out explicitly that the most economically advantageous tender should be assessed on the basis of the best price-quality ratio (…) In order to encourage a greater quality orientation of public procurement, Member States should be permitted to prohibit or restrict use of price only or cost only to assess the most economically advantageous tender where they deem this appropriate.”
In article 15, dedicated to defence and security, it is mentioned that “This Directive shall apply to the awarding of public contracts and to design contests organized in the fields of defence and security, with the exception of the following contracts: (a)
contracts falling within the scope of Directive 2009/81/EC; (b) contracts to which Directive 2009/81/EC does not apply pursuant to Articles 8, 12 and 13 thereof.”
It envisages, in article 11, that “None of the rules, procedures, programs, agreements, arrangements or contracts referred to in this section may be used for the purpose of circumventing the provisions of this Directive”, but, at the same time, it mentions a number of special exceptions in article 13: „contracts for which the application of the rules of this Directive would oblige a Member State to supply information the disclosure of which it considers contrary to the essential interests of its security; contracts awarded in the framework of a cooperative program based on research and development, conducted jointly by at least two Member States for the development of a new product and, where applicable, the later phases of all or part of the life-cycle of this product”.
I wanted to underline and remind you that there are some rules established at a European level, through mechanisms we were part of, through representatives. These should be revealed and used constructively, as they were created. Ignorance can expose us, or it can place us outside the future constructions, wherefore we have made, during years, so many efforts. Also, calling for European regulations’ constraints when exceptions should be invoked, could show the lack of involvement and responsibility or demagogy.
Of course, there are other provisions as well, that those having responsibilities in the field must know and respect. Unfortunately, the whole process generated by budget’s increase for defence is defined through lack of consistency, irresponsibility and political opportunism, even the lack of responsibility regarding national security.
The acquisition of a fight aircraft squadron was based on a political, “opportunistic” decision, choosing the second solution offered by the professional study. The first option (F-16 Block 52, already approved by SCND, Supreme Council of National Defence-Romania, would have involved a bigger amount of money in next year’s spending, given that we were barely getting out of the economic crisis. Although the decision was disputed in Parliament, through a special law, the program was not continued, remaining just a matter of debate.
It is difficult to identify other available F-16 to get them to an identical configuration to the already 12 modernized aircrafts, and time is not on this idea’s side. The lack of a decision on the entry into the European F-16 MLU family or the embracement of an American program for a VIPER configuration should have been solved by now. Upkeeping the ineffective and unrealistic “visions” on the future F-35 acquisition is dangerously postponing the creation of the minimum air reaction necessary for a NATO member state, positioned at Alliance’s east border. This acquisition’s experience should be valorized. Firstly, from making a decision to actually operationalize the equipment takes time. Sometimes even 6 years (!), and something a halfway accomplished thing can be dangerous.
Patriot missiles acquisition, extremely necessary, it was a political decision, approved through a special law, declared as “acquisition made according to a government-to-government agreement”. In fact, this agreement does not even exist! There is the US Congress agreement for Romania’s access to this equipment. The next step, according to the American legislation, was for the Romanian government to negotiate with the manufacturer company. Without commenting more on the scarce logic of lawfully detailing the equipment distribution to two force categories (given that these systems are not protecting the armed forces, but strategic objectives!), I will only say that, by law, there were established supplementary costs for the creation of parallel structures, with the same tasks, as well as a difficulty in implementing them in a unique command-control system. What would be the agreement part, though? What has been modified in the document previously signed in September 2011? There are, of course, other questions as well.
HIMARS missiles acquisition had the same pathway, followed by coast missiles. After such procurement, we should have: supplementary provisions in the Strategic Partnership with the US for the 21st Century, investments of the American companies and other firms associated to them, whose minimum values to allow the Romanian state to accomplish incomes at least alike the amount spent on military acquisitions, a technological transfer to allow equipment’s maintenance and even their modernization for their entire life cycle and guarantees on the logistic support for the same period. Maybe these exist, but they were not revealed to the public.
The first technique acquisition, made after accessing the Alliance, were the FPS radars, fixed or mobile. These radars could be an example for the multiple use of military equipment, being the main source of information for the Air traffic Management made by ROMATSA. Through these radars are being done services which bring the Romanian state incomes, but which are not seen in the air forces budget. Why?
Lockheed Company is the source of many equipment, but we do not see, yet, a production capacity presence, not actual, nor as a partner or coming from the partner companies of the great American company.
Armored carrier acquisitions were announced as a great achievement, however, until now, the only concrete thing was the inauguration of ELBIT’s business place, in Magurele, for the Piranha 5 turrets. The Moreni factory continues to be variously supported by the state, probably until reaching the retirement age of the last syndicalist leaders. Which is even worse is that in all this game was involved also the Rheinmetall company, more or less aware of the situation, but having a great impact, not only economical, but also political.
The acquisition of multifunctional transport platforms is in a deadlock, after the victorious announcement that brought us hopes. Having a certain experience in trucks’ constructions field, we could count on a possible development of the specific industry, even if this tradition was interrupted for a long period of time.
The modernization of the IAR-99 Soim trainer could be one of the decisions to be made this year. The intention to create a fight aircraft, emerged back in the 70’, is, still, unrated, whether we are talking about its benefits or loses. Furthermore, the idea that we could independently create products with our own licenses, without actually having the proper experience, fully confirmed in the field, is still producing effects. We can find it as a solution in the Strategy for the refreshment of the national defence industry. The idea to modernize a training aircraft (seen as great by those who did not flew with different types of aircrafts from the same category, or by the producers who got to sell it only to the Romanian military aviation), could have a favorable result. Or not. They should ask the pilots who have dealt with this aircraft, especially those who survived and were traumatized for life. For a safer investment, maybe it would not be bad to have the support of a famous producer in the field, to get associated to the production, and then to the actual sell. This could be a guarantee for product’s quality.
Frigates’ modernization initiated more than 10 years ago, yet unachieved, with a serious impact in maintaining their minimum operational level, was totally compromised. By connecting this process to corvettes’ acquisition/construction, even the latter possible acquisition was affected. The necessity of corvettes or some littoral multirole ships was discussed, yet abandoned to get something, no matter what, like a group of capable ships to create Romania’s minimum maritime presence. Ulterior, alike the fight aircrafts, there were other “visions”, with submarines and other illusions.
The individual armament was not changed yet, in most of the units, even though at the 2018 BSDA there were presented new weapons, as achievements of our defence industry, by the former national defence minister himself.
What needs to be done? Responsible involvement from everyone. From the highest level. Now it all seems like a chaos, full of compromises that have nothing to do with the real concern of Romania’s security, the Romanian economy or its future.
