Pentagon’s Overpriced Fuel Spark Multi-Billion Dollar “Slush Fund” Allegations

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( — May 24, 2017) — The US Army, Air Force, Navy and Marine Corps pay from their own coffers excessive prices for fuel, because the Department of Defense needs to fill its “slush fund,” the Washington Post reports.

The slush fund, also called a bishop’s fund, is used to finance military operations around the world. In the past few years, some funds were spent to train Syrian “moderate rebels” to combat the ISIS.

According to the report, $80 million was allocated to train 5,400 fighters, but managed to train only 150, while the others were captured by the ISIS or massively deserted. The program failed and the money is gone.

This money had to be generated from some source and according to the Washington Post, the largest chunk came from the Defense Department by overbilling its armed forced for fuel.

The Department of Defense amassed $6 billion over the past seven years by billing the US armed forces excessive prices for fuel, the newspaper reports, citing official documents.

The rates of jet fuel for the US military were often higher than those charged to commercial air transport companies. The billing went up even in time when jet fuel price decreased on the market.

“We’ve been complaining about this,” Ray Mabus, a former Navy secretary, told the Washington Post. “But if we do it too loudly, oh man, they come back on us really hard,” the paper cited Mabus as saying.

According to the report, in April 2013, John P. Roth, the Pentagon’s acting comptroller and chief financial officer, informed the armed forces that the standard fuel price would go up next month from $3.73 to $4.72 per gallon.

A 27% percent hike was applied at the time fuel price actually dropped to $3.05 per gallon.  

The same happened in 2015, after petroleum prices declined on the global market, the report says, with the Pentagon amassing an even bigger surplus. The same year, the Pentagon transferred a total of $1.2 billion to other military accounts.

Since 2011, the Pentagon has withdrawn a total of $5.9 billion from the ‘slush fund,’ the report said, citing figures from the Defense Department. Almost all of “the extra money” was due to fuel savings, according to defense officials.

For his part, the Pentagon’s acting comptroller and chief financial officer dismissed the allegations of the Pentagon running a “slush fund,” noting that it is normal to “balance out manageable shortfalls and surpluses” that invariably arise each fiscal year.

Congress “expects us to solve most of our problems ourselves without coming back and asking them for more money,” the Pentagon’s acting comptroller Roth said.