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Dozens of allegations of corruption made over defence contracts

The Ministry of Defence has made dozens of allegations of bribery and corruption involving Britain's multibillion-pound defence budget, prompting warnings that more should be done to tackle the problem.

Forty-four allegations have been referred to law enforcement agencies by the Ministry of Defence since 2011, according to figures released to Parliament by defence minister Harriett Baldwin.

Four of these involved the bribing of foreign public officials.

The MoD has not excluded any companies from bidding for contracts under procurement law, as none have been found guilty of bribery or corruption.

With nearly £24 billion of MoD money going to British and foreign companies last year, Corruption Watch's Susan Hawley said : "The lack of any effective action against contractors alleged to have been involved in bribery and corruption is deeply worrying.

"It is time that the MoD used its powers to deny companies involved in wrongdoing the right to bid for its contracts."

Figures released to Labour MP Roger Godsiff show that of the four allegations relating to bribery of foreign public officials, one prompted action by the police.

The statistics also show that 29 allegations related to UK companies, while four involved companies based overseas.

MoD policy is that its teams must obtain information from potential suppliers on bribery, corruption or misconduct, and decide whether to exclude them from bidding.

But an allegation of corruption is not enough to exclude a supplier, with only a conviction warranting this action under the relevant legislation.

"This means a court would have had to make a final judgment as to whether the supplier has acted illegally," a defence source said.

In July, watchdog the Single Source Regulations Office challenged the MoD over £61 million of potentially non-allowable costs on single source contracts, where the MoD chooses to work exclusively with one company.

Last year 335 companies were paid more than £5 million by the MoD, Government figures show, while suppliers QinetiQ and Babcock received 68% and 39% respectively of their overall revenue direct from the MoD.

Nearly 90% of QinetiQ's MoD contracts were awarded in non-competitive tenders.

The UK has been the world's second biggest defence exporter over the past decade, selling around 122 billion US dollars (£98 billion) of equipment.

Last year, 63% of its defence exports were sold to the Middle East.

Mr Godsiff, who uncovered the figures through a series of written parliamentary questions, said: "I am concerned that serious allegations of bribery and corruption have not been properly looked into, and that sufficient action has not been taken to ensure that the UK's defence sales are held to the highest standards.

"I do not believe that the UK Government should permit weapons sales to regimes such as Saudi Arabia which use them against civilians, but if they do so then they must at the very least ensure that UK taxpayers' money is not spent on bribing foreign officials who are part of corrupt regimes.

"For the UK to fail to uphold standards on corruption and transparency erodes both our good reputation abroad and our ability to be a positive influence around the world.

"Our interactions with other countries should prioritise human rights and the public good, which does not involve bribing dodgy regimes to buy weapons from us which they will then use in contravention of international law."

Defence minister Mark Lancaster, in an answer to Mr Godsiff, said: "The Ministry of Defence takes allegations of fraud, theft, corruption and bribery seriously and works hard to detect and deter it.

"There are robust processes in place to raise awareness of the need for vigilance and we actively encourage individuals to report fraud, theft, corruption and bribery.

"The MoD routinely carries out checks on potential contractors prior to contract award, including on criminal activity, such as convictions for tax evasion, bribery or fraud, and a review of a company's audited accounts."

The Cabinet Office, which co-ordinates procurement of public sector contracts, says it has made the process more open and transparent, becoming the first G7 country to commit to standards that will ensure every part of the process is visible to the public.

Cabinet Office minister Ben Gummer said the Government "is committed to being the most transparent government in the world".

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