US Army pays Halliburton big bonus

But the Army said performance-based bonuses had not been paid yet to Halliburton’s Kellogg Brown and Root (KBR) unit for dining services for US troops in those countries.

Military auditors have criticised those services as too costly and have asked the Texas-based company to justify its billing.

Halliburton and its subsidiaries have particularly been under scrutiny for over-billing some of its military contracts in Iraq.

The Pentagon has also been criticised for extending undue favours to the firm, once headed by US Vice-President Dick Cheney.

“Dining facilities costs questioned by the Defence Contract Audit Agency have not been included in Award Fee Boards but are scheduled to be addressed later,” an army statement said on Thursday.

Rated highly

Army Field Support Command in Rock Island, Illinois, said award fee boards held over recent months rated KBR’s performance as “excellent” to “very good” for more than a dozen “task orders” in Kuwait and Afghanistan supporting troops.

Much of Halliburton’s work for the US military is on a cost-plus basis, which means the company can earn up to 2% extra depending on their performance.

A US Army spokesman said KBR had been awarded $9.4 million in bonus payments from its work in Kuwait and Afghanistan.

Overall, KBR has earned $7.2 billion under a massive 2001 logistics contract with the US military and is set to earn more than $10 billion under that deal. It has separate deals with the government for reconstruction work in Iraq.

The bulk of money paid out so far under the logistics deal – about $6.6 billion – is for work in Iraq which still must be assessed for bonuses that could amount to hundreds of millions of dollars.

Army contracting officer Sylvia Youngman said the first military award fee board for KBR’s Iraq task orders would begin on 28 February and would likely take many weeks.

Bonuses are awarded based on, among other factors, how efficient and responsive the company is to requests from the army, Youngman said.