Russia says a fifth of defence budget stolen

Tue May 24, 2011 9:16am GMT

* Russia's defence sector riddled with corruption

* Medvedev ups rhetoric against "poor" defence sector

By Guy Faulconbridge

MOSCOW, May 24 (Reuters) - A fifth of Russia's state defence spending is stolen every year by corrupt officials, dishonest generals and crooked contractors, Russia's chief military prosecutor said in an interview published on Tuesday.

President Dmitry Medvedev says endemic corruption is holding back Russia's development, but anti-bribery groups say the problem has become worse since Medvedev was steered into the Kremlin by his mentor Vladimir Putin in 2008.

"Huge money is being stolen - practically every fifth rouble and the troops are still getting poor quality equipment and arms," chief military prosecutor Sergei Fridinsky told Russia's official gazette, Rossiiskaya Gazeta. "Every year more and more money is set aside for defence but the successes are not great," he said, adding that kickbacks and fictitious contracts were being used to defraud the state.

Fridinsky did not give specific figures, but Russia has set more than 1.5 trillion roubles ($53 billion) for national defence in its 2011 budget, indicating theft of more than $10 billion a year from the sector.

While western countries roll back defence spending Putin has promised to spending nearly 20 trillion roubles over the next decade to renew the country's rusting armaments with new submarines, nuclear missiles and air defence systems.   Continued...

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