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Yushchenko orders audit of state spending
Journal Staff Report

KIEV, July 15 - President Viktor Yushchenko on Friday signed a decree directing law enforcement agencies to audit whether state companies have been sticking to current law while spending about $20 billion on goods and services in 2007.

The decree, drafted by the National Security and Defense Council, the country's top security body, is apparently aimed at preventing a controversial change in legislation that has been backed by the government.

The response underscores fears within the presidential office that some of the spending may have been aimed at secretly financing campaigns of parties loyal to the government ahead of the Sept. 30 snap election.

In a related development, Raisa Bohatyriova, a senior member of the Regions Party, quit her post as the honorary chairperson at the Tender Chamber, a body that is supposed to supervise the spending.

Bohatyriova has opposed the new legislation, which reduces authority of the Tender Chamber by allowing state companies to unilaterally select suppliers.

The Yushchenko decree authorizes the Prosecutor General's Office, the security service SBU and the Internal Affairs Minister to check by Sept. 1 whether "the law has been followed" in the area of purchases by state companies.

The law enforcement agencies are also authorized "to take actions" following the investigation, and to submit a special report to the National Security and Defense Council by Oct. 1.

The timing of the investigations and the report apparently underscore fears at the Yushchenko office that some of the spending may be used to finance election campaign of parties affiliated with the government.

Volodymyr Laba,chairman of the Tender Chamber, criticized the government last week for pushing changes to the legislation that had never been signed by the president. Laba said the developments suggest the government may have been seeking to finance loyal parties ahead of the Sept. 30 election.

Meanwhile, Bohatyriova's resignation from the post underscores a growing split within the Regions Party, Ukraine's most popular political group, ahead of the snap election.

Bohatyriova, who is thought to represent the group loyal to Rinat Akhmetov, the wealthiest Ukrainian, in the Regions Party, last week harshly criticized the changes to the legislation. However, hours later she removed her statement from the Tender Chamber's website and two days later she submitted her resignation.

The reshuffle underscores a growing rift within the Regions Party between the hawks and the moderates, analysts said.

The moderate wing apparently includes people loyal to Akhmetov and his ally Boris Kolesnikov, while the hawks include Prime Minister Viktor Yanukovych, Finance Minister Mykola Azarov and Deputy Prime Minister Andriy Kliuyev, analysts said. (nr/ez)




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