UN: UN secretary general Kofi Annan has promised swift reforms following a damning report yesterday into "wholesale" corruption in the Iraqi food-for-oil programme.
He said reforms were of "vital importance" after an independent inquiry found that the programme was badly managed, corrupt and easily manipulated by the Iraqi government.
"There are hard lessons for all of us to learn," Mr Annan told the Security Council after former United States Federal Reserve chairman Paul Volcker released his stinging report into the $64-billion programme, under which Saddam Hussein's regime was allowed to sell oil to buy food, medicines and other essential supplies for the Iraqi population.
Mr Annan said the report contained "lessons about the importance of accountability, and particularly of having clear lines of responsibility and reporting, so that all officials, and all parts of the secretariat, know exactly where their responsibilities lie."
The report praised the programme for reversing the deteriorating food crisis after the UN imposed sanctions on the Iraqi regime.
The UN imposed the sanctions to prevent military expansion by Saddam in the 1990s.
However, it also found that "the wholesale corruption within the programme took place among private companies" and that these companies were "manipulated" by Saddam's government.
It found no evidence that Mr Annan rigged the programme in favour of Cotecna Inspection Services, which had employed his son, Kojo.
This had been one of the central points of investigation for the independent commission.
Mr Annan accepted the report's finding that he failed to investigate the Kojo allegations.
"I accepted then, and still accept, the conclusion that I was not diligent or effective enough in pursuing an investigation after the fact, when I learned that the company which employed my son had won the humanitarian inspection contract. I deeply regret that," he said.
The report found that the former executive director of the UN office of the Iraq programme, Benon Sevan, "corruptly benefited", and said a former UN procurement officer, Alexander Yakovlev, sought bribery payments.
Mr Yakovlev has pleaded guilty to corruption charges.
The report found that many of the problems originated with very poor demarcation of power and overreaching powers by the Security Council.
It also found that the 661 Committee, which oversaw the programme, was composed of national diplomats working under "highly politicised" commands from their home states and unwilling to make any decisions without unanimous consent from the 15 members of the Security Council.
The committee also said the UN made little effort to stop the Iraqi regime from making $8.4 billion in illegal oil smuggling from 1997-2003.
The regime earned $2.6 billion in illegal oil exports before the programme even started, the committee found.
The US ambassador to the UN, John Bolton, said the report should be a "catalyst for change" in the UN.
Mr Bolton said that "there were bribes; there were kickbacks; there was lax oversight from the secretariat; and some member states turned a blind eye toward this corruption".