Former foreign minister cashes in on Iraq crisis

A PRIVATE security company headed by former Foreign Secretary Sir Malcolm Rifkind is making millions from a contract to protect Foreign Office staff working in Iraq, it emerged last night.

ArmorGroup, the biggest ‘mercenary’ security firm working in Iraq, is one of two companies that have raked in a total of 15m between them for providing round-the-clock cover in the treacherous environment of post-war Iraq during the past year.

Rifkind, the Tory candidate in Kensington and Chelsea, sparked protests from political opponents last month when he took over the chairmanship of ArmorGroup, which has 700 employees in Iraq.

Foreign Secretary Jack Straw has admitted they are paying the company - along with Control Risks - 50,000 every day to protect its bureaucrats stationed in Iraq, amid mounting concerns about the safety of civilians in the war-torn country.

The huge fee was described as a "miniscule amount" by one government official last night. But furious MPs condemned the outlay as "appalling value for money", and claimed the government should not be ploughing money into a controversial industry that is making huge profits as part of the reconstruction effort in Iraq.

More than a dozen firms, many employing former servicemen, have been registered to work in Iraq, protecting politicians, civil servants and staff at several of the companies that have won contracts to rebuild Iraq’s shattered infrastructure.

But, amid spiralling concerns about the safety of foreigners in the country, the bill for security is now swallowing up a huge chunk of the $18bn set aside by the Americans for rebuilding the country.

"Some of the firms in Iraq provide very good protection, but I am very concerned that the government is paying so much money for it," said Labour MP Andrew Mackinlay, who has campaigned for more public accountability in the burgeoning private security industry.

"In general, there are no ground rules for what these companies are allowed to do, how much force they are allowed to use. I would like to think our government could provide this sort of protection from its own forces, particularly when so many of the people working for these security companies have left the armed forces because they can earn more money in the private sector."

Private security companies have an estimated 10,000 guards working in Iraq, providing a range of protection for military and civilian figures and key sites. Their lucrative trade has provoked a series of complaints about the influence of heavily armed personnel who are not under the direct control of official forces.

Scotland on Sunday revealed earlier this year that the government had endorsed the first arms exports to Iraq for over a decade, with much of the weaponry, including sub-machine guns, pistols, riot shields and smoke grenades earmarked for use by private guards.

The head of one of several British security firms providing armed protection in Iraq labelled some of his rivals "cowboys" who were putting guns into the hands of untrained, inexperienced personnel.

It also emerged last month that there had been a huge upsurge in the number of officers quitting the British forces, and many were believed to have signed up to work for the private security companies for vastly improved wages.

The Ministry of Defence (MoD) was subsequently forced to beg private firms to stop ‘poaching’ its best soldiers.

But it has now emerged that the government is making a huge contribution to the pay of the private guards, who can earn an average of 600 a day in Iraq. Some 215 guards working for the two companies are engaged in protecting UK staff and buildings across the country.

Foreign Office minister Bill Rammell said: "The Foreign and Commonwealth Office employs two private security companies to provide armed protection for its staff and assets in Iraq. Payments under these contracts to March 31, 2004, have amounted to approximately 15m."

A Foreign Office spokeswoman said Britain had "a couple of hundred" civil servants, from three government departments, seconded to Iraq. She added: "There’ll be people who are out and about who need close protection and others doing mainly desk-jobs who won’t.

"It sounds like a lot of money but, if you look at the US army and the amount they are spending every day in Iraq, it is a miniscule sum of money. You just need to put it into context, and how much it costs us to have the army out there. You don’t expect to pay 50p an hour for something that is risking their lives."

Staff from the Foreign Office, the MoD and the Department for International Development are routinely provided with body armour, safety and communications equipment, security training, briefing and armed protection.

Rifkind, who holds five other City directorships, was forced to defend his decision to take up the part-time position with ArmorGroup last month.