The aggregated version of the overall state budget published by the MoF includes two sources financing: domestic and foreign. The same published budget documents provide information on which program is financed by each of the two sources.
The MoD generates revenue from the disposal of assets and equipment, but these do not appear in the published budget in aggregated or detailed per each sale or auction [1]. There are also donations made in kind to the armed forces by various partner countries [2, 3]. However, the values of these donations do not appear in any of the budget documents.

There are internal and external mechanisms in place for the scrutiny of incomes generated by the defence sector that include the Internal Audits, the Ministry of Finances and the SSAI. A government decision regulates the administration of incomes generated by the budgetary institutions. According to this decision, the incomes generated by the budgetary institutions that conduct economic and commercial activity go to the state budget. Only 30% of the generated incomes may be used by these institutions [1].
The Internal Audits units scrutinise the generation and spending of such incomes and these reports are accessible to the SSAI but are not published, nor presented to the CNS in the parliament [2, 3]. The law on the SSAI stipulates that the SSAI has among others the competence to audit collection of revenues from public institutions [4]. However, the SSAI audit reports presented to the parliament do not contain individual sources of income but only aggregated figures [5].

There is limited public scrutiny on the sources of funding of the defence sector. The media has reported on irregularities with the assets, such as the unjustified removal of assets from the MoD inventory to allow its privatisation by preferred businesses, but no in-depth investigative reports or official investigations have been conducted [1, 2].
Responding to the public debate, the CNS organized a hearing with the minister of defence in 2012, but no further investigations ensued [3].
Despite its relevance, only limited research exists on the topic [4].

No publication on other defence income was found during the research, for example, on the Ministry of Defence website (1). Newspaper reports are claiming that the armed forces plan to sell items produced in their factories on the civil market, including vehicles (2) (3). No further information on potential revenues was found.

There is no specific information on institutional scrutiny of defence income that is not from the central government. The military operates in a very secretive manner and no information on an internal auditing office could be found on the armed forces website (1). A review of laws and decrees issued since 2016 did not provide any evidence that such an office was established during the last few years (2). It is also unclear if the national audit body, the Court of Auditors, is formally responsible. According to Law No. 80-05 of March 1980, it is charged with post-auditing the finances of the state, local authorities, public services and the market capital of the state (3). No information was found whether this includes the non-budget income of state actors. Moreover, the control of the Court of Auditors is limited (4). (See a detailed answer on the powers of the Courts of Auditors in question 17).

Public scrutiny of defence income other than from central government seems to be minimal. Media reports on the military’s economic activities do not provide any information on the potential revenues suggesting that the media can only limitedly scrutinize them (1) (2). This is confirmed by the World Press Freedom Index, which ranked Algeria 136 out of 180 in 2018 (3). Journalists have also reportedly struggled to obtain information on the security sector (4). No evidence was found that CSOs have scrutinized defence incomes outside the defence budget (see the answer to question 4).

Non-central government sources of revenue for the defence sector are not included in the published state budget documents. However, revenue streams are made available they refrain from mentioning non-central government funding or sources (1), (2), (3), (4).

No evidence of such scrutiny or report is made by the inspector general of national defence, nor any other institutional media (1), and the inspector general is not independent.

No evidence found on media report on equipment sales or property disposal in Angola’s defense sector. There was media scrutiny on the sale of five state-owned airplanes to private companies in March 2018; yet, the airplanes were for civilian use and held by the Institutional Air Service in of the Ministry of Territorial Administration.. Media scrutiny focuses rather on defense spending than defense equipment or property sales. For examples the African Globe and the Trading Economics:

Trading Economics’ 2019 and 2016 reports, “Military expenditure (% of GDP) in Angola was reported at 2.9637 % in 2016, according to the World Bank collection of development indicators, compiled from officially recognized sources.Military expenditures data from SIPRI are derived from the NATO definition, which includes all current and capital expenditures on the armed forces, including peacekeeping forces; defense ministries and other government agencies engaged in defense projects” [1] [2].

African Globe (2019) report, ” For a country that has been at peace since the end of civil war 16 years ago and struggling to service its debts as well addressing rampant poverty, is ironic that Angola is one of the African continent’s biggest spenders on military expenditure. Adding controversy to this apparent misplaced priority is the participation of some controversial international companies in bids to strengthen the country’s navy” [3].

The defence budget is accessible through the National Budget Office of the Ministry of Finance and the “Open Budget” platform. There you can know in detail the budget data by object, source, programme, jurisdiction, etc. This also offers the possibility of observing the executed budget, which confers information regarding the factual allocation of resources. [1] With regard to sources, the Ministry of Defence, as of 2018, receives almost all of its financing from internal sources such as the National Treasury, its own resources, internal transfers, etc. and only less than 1% from external sources including transfers and external credit. The detailed assignment of the sources in relation to their assignment does not appear directly, but the data in both portals can be unified and this aspect can be made known. [2] Disposal of assets from the defence jurisdiction, as of all assets in the private domain of the State, is a delegated authority in the EP. The state property administration agency, AABE, a decentralised agency in the field of the Cabinet of Ministers, is the one that manages the pertinent authorisation of the national executive power to dispose and alienate various properties belonging to the State domain. In accordance with current regulations, Art. 15 of Decree 1382/12, the income from the sale of the State’s real estate will be affected by 70% in favor of the budgetary jurisdiction or entity in which it is registered and 30% remaining enters the National Treasury. There is information on the amount of the proceeds from the disposals under the “Sale of Goods and Services of Public Administrations,” in which the defence jurisdiction has a 30.65% stake. [3] However, when looking at the sources of the budget executed in 2018 by that Ministry, it is not easy to distinguish where that source of income is used. Even in the internal audits of that year there is no evaluation in this regard. That is to say, in the case of the sources of income for the defence sector that come from alienation, scrutiny becomes difficult due to the lack of detail regarding the allocation of those resources. [4] [5] [6]

There are scrutiny mechanisms that are administered by a supreme audit institution (SIGEN), and the internal audit office within the Ministry of Defence. However, there is no evidence in the official portals regarding the control of sources of income and the jurisdiction of defence. The scrutiny mechanisms within the Ministry of Defence are the General Directorate of Integrity, Transparency, and Institutional Strengthening, the Internal Audit Unit, and the General Inspections of each Force. Outside the defence jurisdiction, the control bodies are the SIGEN and the Anti-Corruption Office (dependent on the Executive) and the AGN (dependent on the Congress). [1] [2] [3] In the case of SIGEN, this is the highest internal control authority and is the one who coordinates the internal audit units created in the different jurisdictions of the national public sector, as well as the unions in public companies or with state participation. The reports of the Internal Audit unit of the Ministry are on its website, although as of July 2019, only those corresponding to 2016 and 2018 were published. The websites of the Armed Forces and the Joint Chiefs of Staff do not allow access to audit reports carried out by the corresponding General Inspections. SIGEN and AGN make available all the surveys carried out. However, the details of the reports cannot be accessed in many of them. With regard to the disposals that the government makes on state properties, by constitutional regulations they must be approved by Congress (Article 75. Inc 5), thus generating the institutional scrutiny mechanism. However, many of these alienations have been by Decree (delegation of administrative powers), so in Congress projects are evidenced to regulate the sale of properties of the Forces in Congress or the nullity of those processes. [4] [5]

Public scrutiny focuses on the acquisitions made by the defence jurisdiction rather than on the origin of the funds. [1] [2] In 2017, through the Necessity and Urgency Decree (DNU) 595/2017, the Executive Branch made a series of modifications to the national budget and military purchases were authorised through the foreign currency credit mechanism. [3] However, there is no evidence of the scrutiny of those funds. In turn, in terms of internal sources, the attention of the media focuses on situations such as the sale of properties belonging to the Armed Forces, which for example by Decree 225/2017 put up for sale five properties of the Forces [4] and the press report of the Ministry of August 2016, which informs the opening of tenders on various lands belonging to that jurisdiction. [5] The media also focuses on sales, amounts, and the effect on the Armed Forces. [6] The Observatory of the Right to the City, a CSO, declared the unconstitutionality of Decree No. 952/16 which puts 13 State properties up for sale, stating it lacked Congressional procedures of regulatory approval. [7] [8] Less than 1% of financing sources corresponds in general to external sources in the case of the Ministry of Defence and there is no evidence that there is a specific audit on it, nor the existence of an analysis by the media or the CSOs.

Some of the sources other than from central budget are being made transparent and accountable through different regulations. In 26 April 2018, the Government approved the initiative to open a separate bank account in the Treasury of the Ministry of Finance for financial means cumulated by the medical institutions under the auspices of the Ministry of Defence (MoD) through providing paid medical services to people not only affiliated to MoD but also outside of MoD affiliation [1]. A separate account is active for another initiative by the MoD to establish an Insurance Foundation for Servicemen. It provides monetary compensation to the families of soldiers as well as to soldiers injured or fallen in combat on or after January 1, 2017, and it is one of the rare programs that is transparent: the information on income sources and spending is available online [2]. However, Conclusions on the establishment and use of off-balance resources of the RA Ministry of Defense envisaged in the Activity Program of the Audit Chamber of the Republic of Armenia in the official website of the Chamber figure as top secret. [3]

The defence budget of the Republic of Armenia is compiled following Article 21, clause 1 of the Law on the Budgetary System of the Republic of Armenia [1] within a timeframe approved by the Prime Minister’s (PM) decision and the requirements set forth by the “Methodological Guidelines of Ministry of Finance on Compiling Medium-Term Expenditure Program Proposals and Budget Finance Applications and Submitting them to the RA Ministry of Finance by the RA Legislative, Executive and Judicial Authorities, Prosecutor’s Office, and Permanently Functioning Bodies set up by Law” (without exceptions) [2]. Budgeting, including the joint discussions of the RA National Assembly Standing Committee on Defense and Security and the Standing Committee on Financial-Credit and Budgetary Affairs, reflect the budgetary procedure and practice that has been approved for the entire public sector. In addition to the annual budget, additional income is also received from the payments made under the Law on Citizens Who Have Not Completed Compulsory Military Service by Violation of the Order [3], which is directed to the satisfaction of military needs. This income is registered on a special account of the Central Treasury of the RA Ministry of Finance and is managed per the budgetary procedures. Additionally, the amount of penalties imposed by law for each full year of service of the post-contractual military service, as defined by the Law on Military Service and Status of Serviceman, is also collected in favour of the defence budget [4]. An additional source of income is the profit from the sale of cars, their separate junctions and assemblies, which were withdrawn from the operation of the RA Armed Forces. Detailed information on the expenses of the MoD for the previous year is published following the requirements of the law and the government. Reports on the implementation of government-approved state programs should be submitted together with the annual budget execution report. Also, the asset disposal functions of the MoD Capital Construction and Housing Department are scrutinized by the MoD Department of Internal Audit, the Control Department of the Staff of the Ministry of Defence, the MoD Finance, Budget and Planning Department, the Military Prosecutor’s Office, the PM’s Supervisory Service, and the Audit Chamber [5].

Interviewee 5 agreed that the budget issues are within the focus of the CSOs and media, but efforts are not enough to thoroughly scrutinize the sector [1].

Defence income is fully reported in the Defence Annual Report and Portfolio Budget Statement (PBS), and sources other than central government expenditure are marginal. Though the allocation of the income to specific programs is not elaborated, it appears to flow into the overall Defence budget. The Defence Annual Report contains broad and aggregated information about Defence income streams [1], while the Defence PBS breaks this down by program and outcome [2], while also disaggregating overall income by category (for example, sales of lands and buildings and sales of specialist military equipment [2, p96]). Overall income is just under $1.3 billion, compared to a total central government funding of the Defence budget at nearly $32.5 billion. With the cash based budget system, for accounting purposes these income streams would appear to flow into the overall Defence budget for immediate expenditure.

The Auditor-General, assisted by the Australian National Audit Office, is required to audit annual financial statements issued by Defence, including declarations of income [1]. The internal audit unit of Defence is also active (see Q8 and Q16A). The Audit Branch of the Defence Audit and Fraud Control Division delivered 26 audit reports in budget year 2018-19, according to the Defence Annual Report [2], though because these audit reports are not publicly released, it is difficult to say to what extent these internal audits scrutinised sources of Defence income.

Perhaps as a function of the fact that non-central government sources of funding for Defence are relatively marginal compared to the overall Defence budget, there is scant media or CSO scrutiny of Defence income sources, and the lens is not on how the income is accounted for or allocated; rather, it is how equipment sales and property disposals are done. A 2018 article in a major newspaper highlighted environmentally contaminated property being sold to developers [1], while another reported on the glut of land entering the market [2]. An extensive media and internet search was unable to turn up articles on how Defence non-central government income was accounted for or allocated [3].

There is no practice of publishing defence income information in Azerbaijan. Officials and experts have commented on this issue at different times. When they are published, their reliability is questionable. The state budget and other documents do not contain any information about defence income and its sources.
The Ministry of Defence Industry was established in Azerbaijan in 2005 and it declares that in recent years official income from the sale of defence industry products has been raised. According to the experts, Azerbaijan has begun to export military products in 2013. Exports to the foreign countries were $123 million in 2013 and $10 million less in the following year. “Exports figures for the year 2016 have exceeded $120 million. Azerbaijan exports arms to several countries in Turkey, Russia, Belarus, South Korea, South-East Asia, Saudi Arabia, the United Arab Emirates (UAE), Pakistan and the United States of America (US)” (1).
Azerbaijani president İlham Aliyev said, that there are 1200 types of military products produced. Azerbaijan has already started exporting military products (2). Defence Industry Minister Yaver Jamalov said in 2017 that the export of Azerbaijani military products is being carried out by the relevant agencies of more than 10 countries. “At present the cost of concluded contracts is 101 million US dollars. $57 million of this amount is in force, and the remaining $44 million will come into effect after end-user certificates are issued” (3).
However, no information on how these revenues are used is disclosed (4).
There is also the Armed Forces Assistance Fund in the country. It was established in 2002 (5). Fund’s financial source is voluntary funding. The main objective of the Fund is to ensure the development of the Armed Forces and the further strengthening of the social protection of military servicemen. 90 million 426 thousand manats, 214 thousand US dollars, 11 thousand euros and 5 thousand rubles were collected to the Armed Forces Assistance Fund by May 1 of the current year. The Ministry of Defence shares information about the income of this fund (6).

The Chamber of Accounts gave an opinion about the expenditures and inaccuracies in the state budget, and this included the defence sector (1), it is publicly available (2). Also, the Chamber of Commerce reports to parliament each year; the opinion on the budget is submitted to parliament (3). In recent years, the Chamber of Accounts has no reports of military structures in the parliament (4).

In recent years, NGOs and media in Azerbaijan have failed to debate military issues (1). Power structures make serious pressure on non-governmental organizations. Because of that public scrutiny on non-government sources of funding is non-existent (2). There is very limited evidence related to this.

There is no information about the general defence budget outside the central government. Indeed the only source of money for the defence budget comes from petroleum selling [1, 2, 3]. The researcher conducted an extensive online and offline search on literature and reports, but no information was available.

There is no institutional scrutiny on non-central government sources of income. The king’s office is the only institution that can have such figures [1, 2, 3]. The researcher conducted an extensive online and offline search on literature and reports, but no information was available.

There is no public publication of non-central government sources of funding; there is no public scrutiny of non-central income for the defence budget [1, 2, 3]. The researcher conducted an extensive online and offline search on literature and reports, but no information was available.

Bangladesh is one of the top contributors of troops to UN peacekeeping missions [1] and earns a substantial income from these operations [2]. In 2007, foreign media reported this income to be around USD 300 million [3]. Publicly available official information shows that, during the last three fiscal years (FY), the Bangladesh Army earned foreign currencies of about Taka 3,513.49 crore (over USD 400 million) by participating in UN peacekeeping missions, while the Bangladesh Navy earned about Taka 573.00 crore (USD 67 million) during the same period [4]. For the fiscal year 2021-22 budget, placed before Parliament on June 3, the Ministry of Finance has disclosed the income of various agencies of the Ministry of Defence, generated from the collection of examination fees and tender document fees, as well as from the sale of old books and newspapers, livestock, arms and ammunition, dairy products, etc [5]. The MoD’s demands for grants and appropriations are also provided [6], including a summary of operating expenditure [7] and development expenditure [8].

There is not enough information to score this indicator, as no publicly available data could be found through research to establish whether any scrutiny occurs. It is worth noting that there also is not any publicly available information on the scrutiny of the income from UN Peacekeeping Operations, a substantial source of income [1].

There is no evidence of public scrutiny conducted by CSOs or the media of external income generated by Bangladesh’s military.

The annual Budget law is made by two documents, one for the expenses part (Algemene UitgavenBegroting – AUB) and a second one for the receipt part of the budget (Middelenbegroting – MB). In this second document, the disaggregated details for Defence can be found under the chapter 16 for each subdivision (Current & Capital receipts) of the non-fiscal receipts [1]. The more detailed version is responding to the European classification for the national & regional accounts (ESA – European System of Accounts).

Audit mechanisms ensure control over the sources of defence income and their allocation. First, the Inspector-General is an internal audit body which reports directly to the Minister of Defence and the Chief of Defence.

Second, a Federal Audit is an independent body which performs internal audits on governmental processes and activities, including the defence budget and sources of income that do not come from the government [1, 2]. Externally, the Court of Auditors (‘Rekenhof’, ‘Court des Comptes’) scrutinizes the the Defence’s finances. It checks if governmental income is ‘lawful and regular’ [3].

Online searches of the media indicate that there is no consistent scrutiny of sources of defence income, either by the media or by CSOs [1]. When, however, the media does come across inconsistencies, this is widely reported and often has political repercussions [2].

Since all the income generated by the Ministry of Defence, in accordance with Article 64 of the Rule Book on Financial and Material Operating in the Ministry of Defence (MoD) and the Armed Forces of Bosnia and Herzegovina (AFBiH), become part of the central government budget, there is no place for these incomes to be allocated within the organizational structure of defence sector. Furthermore, there is no publicly available data concerning the sources of income [1]. As derived from 2016 Financial Audit Report of the Ministry of Defence, the MoD has access to donor funds but it realized on 21 per cent of them. In addition to budget revenues and grants-based revenues, MoD planned revenues from renting space for the installation of beverage vending machines and snack vending machines in MoD’s and AFBiH’s premises. The MoD does not engage in any business or economic activity. Grants are awarded directly to the MoD through the single treasury account [2]. Grants are implemented according to their purpose and in line with the same procedures that apply to budgetary resources, with a note that at the end of the fiscal year, the unspent portion of funds are transferred to the next accounting period. Under the current regulations, revenues may be generated on other grounds, too (selling surplus assets and equipment, etc.), and their use is regulated through treasury operations. It is important to note that all available resources are implemented through a single treasury system, in a centralised and transparent way. Financial statements are published and are available to the public [3].

There are two mechanisms of scrutiny of financial operations of the Ministry of Defence of Bosnia and Herzegovina [1]. The Auditing Office of the Institution of Bosnia and Herzegovina is administered by the central government [2]. There also is an internal audit office placed within the internal organization of the Ministry of Defence [3, 4]. Grants are awarded directly to the MoD through the single treasury account and are subjected to the scrutiny of the Audit Office [1].

There is almost no scrutiny of the Ministry of Defence’s non-central government sources of funding. The media only provides some general information on the number of donations received [1, 2].

According to the government reviewer, the MoD regularly informs the public about donations of equipment and MTS by partners. The subject matter is also in the audit reports of the BiH Institutions of Auditors in the MoD.

There is not enough information to score this indicator. The only source of Defence funding that is known and published in the Central Government is through the Botswana United Revenue Service [1]. This is evidenced in the most recent 2019/2020 Budget speech by stating that, Madam Speaker, total revenues and grants for 2017/2018 financial year were at P56.41 billion, while total expenditure and net lending amounted to P58.39 billion, resulting in the overall deficit of P1.98 billion, or -1.1 per cent of GDP [2]. This negative budget outturn was due to the lower tax collections during the year [2]. Efforts will, therefore, be intensified to ensure efficiency in the collection of tax revenues by the Botswana Unified Revenue Service through the continuous review of tax laws and leveraging on the use of ICT to enhance compliance [2]. As this speech is the only publicly available source, this indicator cannot be scored.

There is not enough information to score this indicator. As explained in 15A above, the only source of Defence funding that is known and published is the Central Government [1]. The budget speeches available do not refer to any additional source of funds for the BDF other the Central government [2]. However, as this speech is the only publicly available source, this indicator cannot be scored.

There is not enough information to score this indicator. As explained in 15A above, the only source of Defence funding that is known and published is the Central Government [1]. The budget speeches available do not refer to any additional source of funds for the BDF other the Central government [2]. However, as this speech is the only publicly available source, this indicator cannot be scored.

The publication of additional resources (off national budget, but still from the central government) of income for Defence happens. From 2015 to 2018, PAC2 (which is the second phase of the Programa de Aceleração do Crescimento – Program of Development Acceleration) [1, 2], benefited the defence sector with investments of R$112.5 billion, for projects including PROSUB (Navy), SISFRON (Army), and the acquisition of Gripen aircraft [3]. As for other types of income, such as the donations mentioned by the 2015 assessment, according to a military interviewee from the Army, the single forces only have the right to spend what was established in the annual budget. Any income donations go to a federal fund and are characterized as a non-spendable budget surplus. One possible way to make donations to the forces apart from income donations (which are pointless, since the receiver is not able to spend it), are material donations – chairs, computers, and other items. These donations, however, used to happen between public institutions (e.g. illegal weaponry and other materials recollected by the police and later donated to the Army). Defence institutions do not receive strategic materials such as weapons and specialized technology since it could harm the acquisitions doctrine and the Public Acquisitions Law [4]. According to the interviewee, internal regulations regarding donations are not under classification, so any citizen who wants to have access to it can ask for it through an FOIA request.

Internal control institutions can audit all processes concerning other defence incomes. It should be noted that the internal control of the Ministry of Defence does not have jurisdiction to audit single forces processes. Each force has its own internal control system, and they all respond to the Court of Auditors (TCU), which is the external control institution. There is a lack of centralization of control in the Ministry of Defence – but the control prerogatives of each internal control system are present [1].

Brazilian media is historically uninterested in defence issues. Lately, military activities are gaining attention because of President Bolsonaro’s institutional alignment with the military. However, they generally do not address key issues of the forces, nor strategic, nor bureaucratic issues. News related to corruption generally emerges from accusations that the Military Public Ministry register, not the result of investigative journalism. CSO’s that interact with the military are mostly related to reconciliation issues or disarming policies – the assessor could not find consistent data on scrutiny of defence income made by any of them [1, 2]. In addition to that, there is no public scrutiny produced by CSOs on a regular basis.

Apart from central government allocation, the defence sector does have some income generation activities. These activities, for the most part, are linked to public works (roads, building, wells). Funds are also allocated to the security sector from international donors (2). However, they are not published like many other pieces of government data and information (1).

According to the Constitution, the “Court of Accounts is the superior jurisdiction of control of the public finances” (Article 127). The ASCE-LC has been granted constitutional investigation and prosecution rights (1). However, scrutiny of defence income other than from central government allocation still eludes both ASCE-LC and the Court of Account. There is a lack of real power and independence to carry out scrutiny within the defence and security sectors. The 2018 BTI report states, “the National Assembly’s authority and involvement in decision-making suffers from limitations in efficiency and mechanisms of oversight. Moreover, the strong role of the military and inability of the democratic institutions to control the military is a potential threat to the legislative, as became obvious in the course of the 2015 crisis” (2).

Citizens, CSOs, and media scrutinize the defence income other than from government allocation, through advocacy and recommendations (1). CSOs have played a significant role in improving accountability within the defence sector following up of the 2016 military coup (2). However, they face the government’s lack of collaboration and protection of the defence sector, as a government body (3), (4).

Saidou says “Civil society had proposed a “defence and security commission” among the bodies of the transition, to reflect on the reform of the security sector. The army, little open to external control, had objected. The decision to exclude civilians from thinking about the military reflects the reluctance of the military to open the field of defence to civilian control. By habit, the military is reluctant to submit to civilian control” (2).

Funds for the military mainly come from the central government [1]. Other sources of income come from bilateral cooperation. Cameroon receives military support from France, Turkey, China, the United States and several other countries. This aid usually supports the income of the budget. However, there is no reliable publication of information related to other sources of income from equipment sales or property disposal [2].

In addition, the Open Budget Survey (Jan 2018) states that the most recent budget did not present individual sources of non-tax revenue in the Executive’s Budget Proposal or any supporting budget documentation [3].

There is no evidence of institutional scrutiny of non-central government sources of funding [1]. According to the Open Budget Survey (Jan 2018), the most recent budget did not present individual sources of non-tax revenue in the Executive’s Budget Proposal or any supporting budget documentation [2].

In addition, there is limited oversight of the budget [2] and Article 35 of the Constitution also limits parliamentary oversight of defence and security [3].

There is no evidence of public scrutiny of funding that is not from central government. According to the Open Budget Survey (Jan 2018), the most recent budget did not present individual sources of non-tax revenue in the Executive’s Budget Proposal or any supporting budget documentation, making public scrutiny of such sources of funding impossible [1].

While military surplus equipment is sold alongside other government surplus, including to foreign governments, it is difficult to obtain information about the funds generated by those sales, and even more so about the identity of purchasers. Although a website lists the surplus materials for sale for other categories, military surplus information is only available to certified foreign governments, or dealers of military equipment. [1] A query about this information yielded the response that an access to information request was necessary for a member of the public to obtain this data. The Departmental Plan and quarterly reports do not specify any sources of revenue at all, beyond recoveries (corrections or reversals of overpayments) to servicemembers, other government agencies, or other governments. [2] [3]. DND considerations and consultations have broadened for the retention, sale, or transfer of property to Indigenous groups, various levels of government, local communities, and the private sector. [4]

Federal law states that departments deeming their Crown assets to be surplus to requirements may sell, lease, lend, or give away these assets with either Ministerial assent or consent of the Treasury Board. [1] The latter would consist of a central government department. However, Ministerial permission suffices, which is not subject to central audit. DND considerations and consultations have broadened for the retention, sale, or transfer of property to Indigenous groups, various levels of government, local communities, and the private sector. [2]

Some elements of the divestment or disposal of defence related properties are present throughout the Canadian media landscape, such as noting the divesting of Sea King helicopers through donation to museums, [1] or the offloading of old machine guns after the procurement of newer models by the Canadian Forces. [2] Additionally Members of Parliament have voiced their opinions on the use of DND owned properties and the potential for public access through the media. [3] This suggests that there is a public appetite for knowledge about the use and/or disposal of DND assets. However the extent to which this is covered is inconsistent and sporadic, and often lacks attention at the level of National media coverage. DND considerations and consultations have broadened for the retention, sale, or transfer of property to Indigenous groups, various levels of government, local communities, and the private sector. [4]

There are at least six secondary sources of funding, which, taken together, account for about five per cent of the total budget: the Revolving Supply Fund (FORA), the Patrimony of Fiscal Impact (PAF), health funds, the Infrastructure Fund, and income from fees and sales of goods and services [1, 2]. The Budget Direction of the Ministry of Finance (DIPRES) publishes annual income obtained from the sales of financial and non-financial assets by institutions and agencies in the defence sector, but it does not include detailed information about the allocation of these resources. In addition, there is an important source of resources, which are transferred through the Restricted Law of Copper [3]. In accordance with this legal framework (modified by Law 18.445 and 18.628), the transfer of resources belonging to the Restricted Copper Law must be done in a “restricted” manner, kept in secret accounts, and its accounting must be restricted. In September 2019, legislation with a new funding mechanism for the strategic capabilities in the defence sector was passed [4], derogating the restricted fund associated with the Restricted Copper Law. The new mechanism establishes a Multi-annual Fund of Strategic Capabilities, to give stability to the investments of the defence sector, particularly for the financing of war material, infrastructure and maintenance expenses. The legislation entered into force in 2020, and it should be taken into account in the follow-up evaluations.

Mechanisms of scrutiny for defence income performed by the General Comptroller (CGR), which is in charge of the external audit of the defence income and expenditure. The CGR is generally regarded as an autonomous and politically isolated body, notwithstanding the limited scope of its actions in the defence sector. Although the CGR performs specific audit reports for the use of resources in different agencies of defence, investigations tend to be reactive [1], and there is no evidence of specific work on scrutinizing sources of income other than the central public budget. Internally, the Ministry of National Defence (MDN) (2016) indicated the elaboration of a plan for bi-annual audits to the process of acquisition and contracting from resources that belong to both the central budget (Ley 19.886) and the Copper law (Ley 13.196) [2]. However, neither the content of these audits nor their results and findings are publicly available.

The public scrutiny of non-central government sources of funding for the defence sector has found formidable obstacles. This has to do with the “restricted” nature of the main proportion of these resources, that is, those that belong to the Restricted Law of Copper. A member of a CSO commented on the difficulties of analysing the use of these resources due to the absence of data and legal restriction [1]. In the last few years, there has been an active investigation by mass media about the use of reserved expenditures in the armed and security forces, which contributed to unveil scandals associated with fraud and malfeasance [2, 3]. However, these investigations are based on reserved expenditures rather than resources from the non-government public budget.

The government and the army publish only the centrally allocated defence budget. There is no transparency regarding the army’s alternative sources of income from arms sales or commercial activities of state-owned-enterprises in the defence sector. This is due to the overall secrecy of the Chinese government on military affairs, budgets and resources. [1]

At the central level, all sources of income are scrutinized internally by the PLA’s Audit Office under the Central Military Commission (中央军委审计署). [1,2] There is no external scrutiny. Audit offices exist from the CMC down to the unit level. Although there is no information on these sources and there are no reports on corruption cases directly related to non-central sources of income, there is evidence of the effective operation of audit processes especially during anticorruption campaigns implemented by the CCP throughout the armed forces. [3,4]

There is no scrutiny of the military’s budget and sources of income, as most army-related affairs are considered politically sensitive areas. Chinese media report exclusively on the information provided by the government as there is no independent investigative reporting on these matters.

The publication of sources of defence income that do not come from government allocations is not clearly identifiable in the defence sector budget for 2019, [1] nor in the budget implementation documents for the first half of 2019, [2] or in the implementation of the 2017 or 2018 budget. The General Budget of the Nation only identifies budget items on the basis of current revenue, capital resources, special and parafiscal funds, public establishments and financing law; and the allocation of revenue is identified in a sectoral way, identifying 30 sectors including the defence and police sector. The budget implementation documents for the years 2016, 2017, 2018, and 2019 [3, 4, 5, 6] present the general percentages related to personnel expenses, overhead, transfers, commercial operation, financial assets, reductions in liabilities, and tax and investment expenses, but they do not disaggregate the information, making it difficult to identify the sources of revenue for the sector. The Social and Business Group of Defence (GSED), a conglomerate of 18 entities including Cotecmar, INDUMIL Military Industry, CIAC, Codaltec, and the Tequendama Hotel, publish the relationship of their income and expenses, but there is no evidence regarding the economic contributions of these companies to the areas of the military forces, nor was information found from other sources of private income to the defence sector. [7, 8, 9] Although all sources of income are published, little or no information is disclosed on the amounts received or on the allocation of that income.

Institutional scrutiny of defence revenue that does not come from the central government is carried out by the internal oversight offices and the Planning and Budgeting Directorate of the Ministry of Defence. The main function of the latter is planning, programming, management, and monitoring of the budget, including the units of the Ministry of National Defence, the Military Forces, and the National Police, as well as the entities and units represented in the Social and Business Group (GSED) of the Defence Sector. [1] Each of the entities in the sector has these offices, so that there is a permanent monitoring on budget implementation. According to the Anti-Corruption, [2] the Head of Internal Control shall report to the Director of the Administrative Department of the Presidency of the Republic and to the supervisory bodies any acts of corruption and irregularities found so that the Comptroller General of the Republic can generate the necessary actions. [3] There is internal and external scrutiny on the use of resources from the defence budget, including all sources of income. There is institutional review and oversight mechanisms for economic resources and the budget of military forces by external and internal bodies, including the supervision of the GSED.

We cannot distinguish scrutiny specifically for this indicator, but, generally, it is evident that there is considerable and consistent scrutiny within the media about acts of corruption within the Ministry of Defence and the Military Forces and Police. This occurs in national media, radio, and in international press. [1,2] These outlets have published various, at times in-depth, investigations on the misuse of public resources, the award of contracts, and the implementation of actions and measures related to each entity. They have also monitored commercial operations carried out by the Social and Business Group of the Defence Sector (GSED), who make sales for services within the defence sector. For Interviewee 3, these have generated strong influence on public opinion, due to their credibility and independence. [3] On some occasions these have led to guideline reviews or adjustments within the Ministry of Defence or the Military Forces and Police. The influence of CSOs in this regard is limited, because they largely specialise in issues related to violence exercised by actors of armed conflict, such as the Military Forces, Police, and illegal groups such as guerrillas, paramilitaries, and criminal gangs, rather than corruption-related issues. There is no evidence of civil society organisations working on corruption or budgetary oversight in the defence sector although Transparencia por Colombia carries out general corruption investigations and reporting. [4] Given this evidence, it could be suggested that sources of defence income other than from central government allocation might be equally scrutinised.

There is no evidence that the MoD has alternate (formal) sources of income other than the resources allocated by the central government via the annual Budget Law (Loi de Finances). Côte d’Ivoire does not have an arms industry that could generate extra-budgetary income for the MoD. Even if equipment or property were to be sold, there would be no official disclosure of that type of income. A separate issue is money generated by individual former rebel leaders of the Forces Nouvelles (FN), (known by the acronym of COMZONES) who in practice may manage commodities trade and natural resources within their spheres of influence.

According to a March 2016 IFRI report by Aline Leboeuf, some COMZONES profit from this kind of parallel local economy, including the trafficking of gold, diamonds and cocoa:

“The Comzone galaxy is very heterogeneous. Although the shining “stars” of the Comzone system have been sidelines, their young heirs, who are less famous and have not been prosecuted for war crimes, remain willing to replace them and to continue their work, including the controlling of certain segments of the Ivorian informal economy. However, their influence is smaller than that of their elders” (1).

“The latest report submitted to the Security Council on April 13, 2015 states that “the influence that some former zone commanders have on the state security apparatus remains problematic” and again uses General Wattao’s involvement in gold and diamond trafficking and illegal taxation of transportation. As for Losseni Fofana’s BSO, he purportedly extorts the illegal cocoa farmers with plantations nearby Duékoué national park.”

There is no evidence of alternate (formal) sources of income for the MoD other than the central government allocations. Hence, there is no oversight of such revenue flows. Côte d’Ivoire does not have an arms industry that could generate extra-budgetary income for the MoD. Even if the equipment were to be sold or property disposed of in the market, no institutional scrutiny is in place to monitor such flows because of political reasons.

According to a March 2016 IFRI report by Aline Leboeuf, certain COMZONES control the local informal economy, including the trafficking in gold, diamonds and cocoa. Leboeuf maintains there has been a tacit tolerance of such informal sources of income by the administration of President Outtara because of the threat that COMZONES continue to pose to political stability in the aftermath of the 2010-2011 crisis. “The problem with the comzones also has to do with the control they continue to exercise over their fighters, who may be reintegrated into society or not, but who remain armed and available to fight as auxiliaries or simply to serve as guardians to protect the mines or other illegal activities of the comzones.”

There has been public scrutiny (media, academics, CSOs) over the control that certain former rebel leaders of the Forces Nouvelles (FN), known as COMZONES, have over the informal economy within their spheres of influence. For example, a March 2016 IFRI report by Aline Leboeuf addresses the trafficking practices of Issiaka Ouattara (known as Wattao) in the region of Séguéla. Jeune Afrique has carried regular updates of regional military warlords, and the non-central government income they receive from operating a local parallel economy: (1) (2)

“While few COMZONES have been sanctioned by the UN Security Council and none are currently being pursued by the International Criminal Court, reports issued by the panel of experts on Côte d’Ivoire established as per Article 27 of Resolution 2153 (2014) exposed the types of parallel informal economy that some COMZONES have managed to put in place to exploit Ivorian resources to their ends…The last report, published by the Security Council on 13 April 2015, states that “the influence that some former zone commanders exert over the state security apparatus remains problematic,” and again highlights the involvement of Wattao in trafficking of gold and diamonds and in the illegal taxation of transportation networks” (1).

An OFPRA report from September 2017 lists the names of the COMZONES; and the areas in which they can supplement their income from the MoD by trafficking in commodities and natural resources (3). They include Morou Ouattra (known as Atchengué), Hervé Toure (known as Vetchio), Ousmane Cherif, Tuo Fozie, Messamba Kone, Zoumana Ouattara, Issiaka Ouattara (known as Wattao), Losséni Fofana, Daouda Doumbia, Ousmane Coulibaly, Gaoussou Kone, Martin Fofie and Zakaria Kone.

Other sources of defence income are published in two sources: the annual reports of the Defence Command and the the defence budget as in the Finance act. Information on the allocation of this income is included (amount and account number) [1, 2]. Sales of minor items such as cars are auctioned to the public online while sales of properties are announced on the Minsitry of Defence Estate Agency website [3, 4].

The Ministry of Defence Internal Audit Office and the Danish National Audit Office scrutinise the accounts of the Ministry of Defence (including Defence Command) [1] and the state [2]. Sources of income other than from central government are included in these accounts.

There are some indications that media and civil society is concerned with/about Defence equipment sales and property disposals when these occur. Some members of the media treat the issue in a scrutinising manner while other members of the media and civil society are more concerned with issues of cultural heritage, urban development etc. [1, 2, 3, 4, 5]. Generally, sources of defence income do not appear to be a subject of considerable and constant scrutiny. This is only natural as defence income from equipment sales etc. is not a source of corruption in Denmark, i.e. it does not reflect a weakness of the system or public scrutiny.

The military earns a huge income from economic activities, its budget and sources of income are a mystery and no real and accurate data is available for either the public, the ACA or even the Ministry of Finance (1), (2), (3). The economic activity of the military is considered as a major information black hole, and estimates of its size are little more than speculations, and they vary between 2-40% of the GDP (4). This very large gap is a result of a lack of concrete information about these activities and their revenue streams. President al-Sisi himself joined in the speculative exercise saying that the size of the military economy is by no means more than 2% of GDP in an attempt to show that the higher estimates are completely blown out of proportion (5). Regardless of the size of the military economy, what matters is that there is no way for the public or even supervisory and monitoring bodies to know any details about the sources of income.

According to our sources, despite that the military has a huge industry and income from economic activities, its budget and sources of income are a mystery and no real and accurate data available fro either public, ACA or even the Ministry of Finance (1), (2), (3). The government, including the current president, has repeatedly asserted that all military economic activity is subject to scrutiny by the supreme audit institution the Central Auditing Agency (CAA). The reports and findings of the CAA are not made available to the public. However, in 2014 al-Sisi passed a law to allow him to remove the directors of supervisory authorities including that of the CAA. Many commentators believed the law was passed specifically to “handle” the then CAA director Hisham Geneina. Geneina was removed from his post after speaking in the media about the size and scale of government corruption and started facing trial for “spreading false news” (4), (6). He also faces a military trial for “defaming the Armed Forces” after supporting the presidential candidacy of Sami Anan against al-Sisi. After Anan was arrested, Geniena threatened to expose top-secrets about the military’s involvement in causing social unrest following the 2011 revolution (5). In sum, even if formal mechanisms and institutions exist, the type of scrutiny exercised by them is deemed ineffective given the broad mandate and powers of the president and the military courts to restrict these institutions and hunt down their officials.

According to our sources, there is no public scrutiny over non-central government sources of income despite many efforts to raise questions about the role of the army in the economy of Egypt (1), (2), (3). Many media outlets and NGOs are still active in scrutinizing issues around extra-budgetary military income and revenue streams. However, this is a shrinking space for both media and civil society, and the lack of information makes this task all the more difficult (4), (5).

Defence income is included in the national defence budget. Besides the central government, it also includes a detailed overview of the income stemming from economic activities: from carrying out courses, sales, fines and penalties, as well as from the health centre. [1] There is also a short explanation on why the income has decreased. The budget further explains that the Ministry of Defence receives rental payments from different institutions under the Ministry of Defence. There are also explanations about foreign funding and where it will be invested. Each source of revenue includes the amount, and an indication of reasons why it has increased or decreased. In some cases, there is also an indication of how exactly it will be spent, but not in all cases.

Estonia’s independent institution, the National Audit Office, regularly audits the defence sector’s financial activities. In accordance with the National Audit Office Act, [1] the National Audit Office may assess the auditee’s financial management, accounting and statements. The Office also assesses the legality of the auditee’s economic activities, including economic transactions. The National Audit Office is directed by the Auditor General who has the same management attributions as those granted by law to a minister for directing a ministry. The Defence Ministry’s internal audit unit gives an objective assessment of the area of the Ministry of Defence’s financial activities. [2]

Based on interviewees with CSOs and media outlets, [1,2] there is very limited public information about sources of income in the defence sector. This is not a matter of discussion for the wider audience. There are no articles published about this. Even experts in the field lack information. Representatives of CSOs do not make any requests for information about this. Even journalists who often write about defence issues lack information about sources of defence income. Public scrutiny of non-central government sources of funding is hence minimal or non-existent, especially if this becomes a problem at an expert level.

Income sources other than annual appropriations are disclosed in budget proposals, budgets, and in the final state accounts. These are indicated in a highly aggregated format i.e. Revenue of the defence admistration’s construction agency, revenue from chattel sales and immaterial property royalties, and other revenue [1] [2]. Revenue under the first category may be temporarily used for funding renovations. Revenue under the second catecory may be used for chatter acquisition and maintenance, expenses due to material exchanges with national defence industry, and expenses due to chattel sales. [1]

Each state agency or institution is obliged by law to organise compliance and internal audit. The financial administration units carry out self-monitoring on top of which both the Defence Forces and the Ministry of Defence have their own compliance and risk management units. State Treasury may provide further orders on financial administration matters to state agencies, institutions and foundations external to the state budget. State agencies and institutions are obliged to provide help and guidance to other agencies and institutions in financial administration matters upon their request. [1]

Furthermore, the controller function within the Ministry of Finance oversees and develops the quality of the guidance and reporting system of the state economy and accountability. Its tasks include: ensure that the Goverment’s annual report is based on correct and sufficient information and that important information on state economy and efficiency are available for preparing and decision making; direct, coordinate and develop reporting on the state’s final accounts, other reporting on state economy, auditing, and the arrangements for compliance; and so forth.

The controller function may present to the Government, the ministries and state agencies, institutions, foundations or publicly owned undertakings a report on its observations and possible recommendations based on those observations. It may also forward its observations and recommendations to the National Audit Office or another competent authority. The controller function has the right to receive information, documents and reports necessary for it to carry out its tasks from a state agency or institution, publicly owned undertaking and foundation external to the state budget. In occasions this also includes disclosed information. Even if the controller function operates as part of the Ministry of Finance, it has independent decision making powers when it comes to reporting on its findings, information requests and responses to informations requests. [2]

The National Audit Office of Finland also inspects the final state accounts and the final accounts of the state’s accounting entities annually. [3] In the administrative branch of the Ministry of Defence the accounting entities include the defence administration’s consruction agency, the Ministry of Defence, and the Defence Forces. Defence related accounting entities in other administrative branches include the Border Guard (the Ministry of the Interior) and the Ministry of Foreign Affairs. [4]

As little detailed information about the non-central government sources of funding is published (only the aggregated revenue figure), there is no public scrutiny over it.

There is full publication of the defence income from the State budget allocation through the Military Programming Law (LPM) and the Finance Law Bill (PLF), but there is less readily-available information about amounts received via non-fiscal revenues. Every year, during the vote of the PLF that decides on the armies’ budget for the year to come, an appendix to the PLF is published that sums up the non-fiscal revenues of various fields of government, and among them of the armies. [1] For non-fiscal revenues (equipment sales for instance) [2] there is an exception to the principle of budgetary universality, that is the income dedicated to a peculiar use, therefore the allocation of this income isn’t addressed. This information is presented in a technical way that is not easy to understand for the public.

As for the income from real estate assets of the Ministry of the Armed Forces, the inventory of the real estate of the Ministry is held within the framework of the general table of the properties of the State (TGPE), which includes – classified by service or user organisation and by geographical department, territory or country – the buildings of the public and the private domain of the State as well as those of national public institutions of an administrative nature. The real estate inventory of the Ministry of the Armed Forces, like that of other ministries, is not accessible to the public. The parliamentary and supervisory authorities, however, can have access to this information, thanks to their powers. [3]

The Cour des comptes stems from article XV of the Declaration of Human & Citizen Rights of 1789. [1] It is an independent institution. Its role is to control all bodies receiving public money. Within the Cour des Comptes, the 4th Chamber specifically targets institutions of Defence and security. [2]
The court’s recommendations aren’t compulsory, but the Cour des Comptes website asserts that “70% of its recommendations are partially or totally implemented within 3 years.” [3]
The Cour des Comptes is a very respected and trusted institution, which never fails to openly express its recriminations, even when they concern the current government. Its publications are regularly widely echoed in the media. [4] However, the Court doesn’t audit the Ministry of Armed Forces’ income sources and disposal on a regular basis. The last inventory on the Ministry’s real estate was done by the Cour des Comptes in 2007. [5] The “Fonds de concours” and “rattachement de produits” income represented 700 M€ in 2018, but distributed into at least 20 different budgetary lines, so there is no good reason for the court to spend time on this peculiar problem.
In November 2017, it issued an alert to the Prime Minister, warning about a discrepancy between the budget of the armed forces in the LMP project (2014-2019), and the ambitions set by the executive power, engaging French troops in several operation fields abroad and mobilising them domestically for the “Sentinelle” plan. [6]

There is also an internal audit service of the Ministry of the Armed Forces, the “Audit Center of the Armed Forces” (C2A), created in 2011. It is supposedly in charge of certifying the budget and expenditures of the armed forces, though it hasn’t published any open-access recommendations since its creation. [7] [8]

There is some scrutiny by the public, mostly by the media (often from defence-specialised journalists). The 2017 warning issued by the Cour des Comptes was, for instance, broadly covered by the media. [1] [2] Again, in 2018, the media echoed the latest report of the Cour des Comptes on the State budget, highlighting the mismanagement of the procurement and construction of “Balard”, the new Ministry of the Armed Forces in Paris’ XV arrondissement. [3]
Few CSOs scrutinise defence income; Transparency International does, through this Government Defence Integrity Index. [4] On a lower lewel and with a more militant approach, associations such as Anticor, [5] or “anti-françafrique” and anti-militarist Survie association [6] keep an eye on the defence income and expenditures.
As far as the public is concerned, there is very little interest in the issue of defence income. It is hard to say whether this lack of interest stems from the lack of publicity and communication of military institutions towards CSOs, the media and the public, or if it is just not among the traditional fields of interest of the French public.

In the Federal Budget, income titles are organised by purpose; under each title, users can see the source of the income [1]. All income must be registered under the title provided for this purpose. Any defence income from sources other than from central government allocation is included in the budget of the Ministry of Defence, as well as all other parts of the budget, and is scrutinised by the Federal Audit Office. The latter’s evaluation reports can be found in the Annual Reports on Federal Financial Management (‘Bemerkungen’), Category C: ‘Sonstige Prüfungs und Beratungsergebnisse’ [2]. The annual Federal Budget is provided on a centralised website [1], which also lists incomes other than budgetary allocations. Such incomes include, for example, the sale of moveable assets, incomes from fees, leases and interests, as well as research grants to armed forces universities. The detailed budgetary plan outlines the specific purposes for which additional income is being used. Defence income other than from central government allocation is broken down in a detailed manner, with explanations and descriptions provided for each line. The Defence Budget specifies that this income flows directly into expenditure, which is listed below income [3].

Mechanisms of scrutiny are in place and administered by a central government department, i.e. the supreme audit institution, as well as the internal audit office within the Federal Ministry of Defence. In accordance with Paragraph 2, Article 114 of the Grundgesetz, the Federal Audit Office has the constitutional mandate to examine and report on the Federal Government’s budgetary and economic management as an external financial control body [1]. As an independent financial control body, it is a supreme federal authority that is only subject to the law. The President, the Vice President, the heads of department and the heads of the examination department enjoy judicial independence. As part of its work, the Federal Audit Office examines the Federal Government’s budgetary and economic management. Budgetary and economic management is understood to mean all financial processes, meaning that everything that has a financial impact on the Federal Government, whether in terms of budget or assets, is subject to review by the Federal Audit Office.

The Federal Audit Office informs the German Bundestag, the Bundesrat (‘Federal Council’) and the Federal Government about its most important audit results through its annual report, delivered in the form of ‘Bemerkungen’ (comments) on the budgetary and economic management of the Federal Government [2]. The Federal Audit Office summarises the results of its audits in audit reports, which it sends to the audited bodies. The Federal Audit Office decides whether and to what extent it publishes its audit results. In order to increase the effectiveness of its recommendations, the Federal Audit Office regularly conducts an inquiry process following the completion of an audit. To this end, it asks the audited body to what extent the promised recommendations have been implemented and, if necessary, requests the relevant evidence. The findings of this inquiry process may lead to a report to the German Bundestag or an inspection.

Outside the ‘Bemerkungen’, the Federal Audit Office can notify the German Bundestag, Bundesrat and Federal Government about matters of particular importance at any time (see Section 99 of the Federal Budget Code) [3]. There are no institutionalised audit mechanisms administered by the BMVg audit office for sources of income in the ​​defence sector. Fields and topics of audits are recorded in a risk-based manner in multi-year plans and concrete annual plans and are not limited to financial risks. However, since there are sources of income in a wide range of specialist areas within the defence sector, these are regularly included in audits carried out by the audit office, which are carried out in specialist areas and relate in particular to budgetary and economic management [4].

There is considerable and consistent scrutiny by the public, including the media and CSOs [1]. The Federal Budget and the federal budget are published by the Federal Ministry of Finance and are therefore accessible to the public and the media. The preparation and implementation of the budget are also subject to parliamentary oversight. The budget is approved by Parliament and its implementation is monitored by the Federal Audit Office [2,3,4].

There are selective publications on sources of income. For instance, there is a publication on internal income such as those from the 37 Military Hospital, but it is far from comprehensive. The full amount that the armed forces generate from peace support operations all over the world is generally kept secret (1), (2). Published national audit reports only include limited financial information from the Ministry of Defence. This includes mostly recurring operational costs, such as payroll information and taxes (3).

According to the 2018 budget, the MOD’s Internally Generated Fund (IGF) amounted to GH¢11.883m (approximately 246,000 USD). All the IGF revenue that was generated was subsequently spent (4). The whole amount was generated through the Military Health Service.

The Audit-Service is the main public institution mandated with promoting “good governance, transparency, accountability and probity in Ghana’s public financial management system”. The audits are used to make recommendations to Parliament (1). According to Section 13 “Examination of accounts”, the Auditor-General shall examine the public and other government accounts to verify if: “a) the accounts have been properly kept; (b) all public monies have been fully accounted for, and rules and procedures applicable are sufficient to secure an effective check on the assessment, collection and proper allocation of the revenue; (c) monies have been expended for the purposes for which they were appropriated and the expenditures have been made as authorised; (d) essential records are maintained and the rules and procedures applied are sufficient to safeguard and control public property; and (e) programmes and activities have been undertaken with due regard to economy, efficiency and effectiveness in relation to the resources utilised and results achieved”.

This also includes any source of income that does not come from the central government. However, according to the last publicly available report, no investigation has been conducted to scrutinise the MOD’s alternative sources of income (2).

Additionally, the Internal Audit Agency promotes good governance, transparency, accountability and probity in Ghana’s public financial management system by auditing to recognized international standards and reporting audit results and recommendations to Parliament. The Internal Audit Agency was established to support the transfer of budgetary authority and expenditure control to the MDAs and MMDAs.

CSOs and the media do not conduct scrutiny on non-central government sources of funding (1), (2), (3), (4), (5). Looking at the research of several CSOs’ operating in Ghana (Ghana Anti-Corruption Coalition, Ghana Integrity Initiative, Strengthening Transparency, Accountability and Responsiveness in Ghana, West Africa Civil Society Institute, Centre for Democratic Development), and looking at Ghanaian news media outlets (Modern Ghana, Myjoyonline, GhanaWeb, Ghana News Agency, Graphic Online) no evidence of scrutiny towards non-central government sources has been found.

The publication of income sources is selective and no information is released on amounts received or on the allocation of this income [1, 2]. The ministry of finance occasionally publishes such figures in reports.
Sources of income and amounts received are not published where they originate from utilization of equipment due to information classification. If they originate from services to public or private local and international sector, they could be provided in case of request to meet the scope of transparency and publicity. However, there is no determined systematic publication [3].

Mechanisms of scrutiny are in place and administered by central government departments such as the Supreme Audit Institution [1]. However, the Internal Audit Office within the MoD rarely scrutinises such funding when the need arises but such findings are not released [2].

There is some scrutiny by the public, including by the media and CSOs, but it may not be in-depth or consistent [1]. In March 2018, for example, the media published a story on the issues involving the sale of Greek defence equipment to Saudi Arabia [2].

The annual budget report and the budget plan both include the main numbers of planned income [1]. While the total income constitutes eight per cent of the budget, six per cent constitutes the income from the healthcare budget covering the costs of the central military hospital and only two per cent comes from sources other than central government allocation. That two per cent is mainly from property income and sale of the surplus; however, no detailed information is provided on these transactions.

The Supreme Audit Institution is the independent body that can initiate special audits and regular audits at companies owned by the state [1]. The ministry has an internal controlling department [2] that scrutinises this income as well, and the government and prime minister can also initiate investigations through the Government Control Office [3]. As stated above the overall income is marginal.

There have been several occasions when investigative journalists tried to look deeper into the activities of the companies of the ministries, such as the HM EI Zrt, which was the subject of corruption cases previously [1] and is currently responsible for selling military surpluses of the army [2], but due to the level of secrecy, they had limited success. It should be noted that there are other companies mentioned in the report, not just HM El Zrt and there is no indication that there is a special interest in HM El Zrt.

There are no publicly available official financial statements containing non-central government defence income particulars [1][2][3][4]. There are other financial statements available such as the Defence Services Estimates [5].

As stated above, there is no official information on non-central government defence income particulars. Internal audits are carried out by the Comptroller General of Defence Accounts (CGDA) and the Secretary (Defence Finance)/Financial Adviser (Defence Services) [1][2]. There is scrutiny by CAG and PAC and in 2013, audit reports stated that the MoD has in a few instances over time misused land and earmarked “Inordinate delay in renewal of leases of Defence land resulting in non-realisation of revenue”, “unauthorized occupation of Defence land by other departments” and “non-recovery of service charges from Railways”[3][4].

There is public scrutiny if misappropriations are reported in the media, as there is no official information on non-central government defence income particulars publicly available and accessible. The misappropriation is debated by media outlets, the public is encouraged to share their thoughts and the topic becomes a talking point [1][2].

Law No. 34/2004 concerning the Indonesian National Defence Forces stipulates that the TNI is financed by the national defence budget derived from the State Budget (APBN) [1]. The TNI’s budgetary requirements are proposed by the Minister of Defence. Thus, in theory, there is no room for revenue outside what is allocated by the central government. In the past, the TNI business networks became a source of off-budget revenue outside of the official budgeting mechanism and without a transparent financial monitoring and control mechanism [2]. In addition to business units owned by the TNI, off-budget revenue was also obtained through the provision of security services for business activities of entrepreneurs who had formed informal alliances with the TNI [2]. Law No. 34/2004 put a stop to these practices. Besides prohibiting soldiers from taking part in business activities, this law also stipulates that the government must take over all business activities previously owned and managed directly or indirectly by the TNI. Since then, a number of milestones have been achieved. In 2014, the government claimed that the TNI’s role in economic activity had been reduced by 80% [3]. In 2016 and 2017, state auditors granted the Ministry of Defence the Qualified Opinion (Reasonable with Exceptions/WDP) [4]. The WDP result is given in the case of minor irregularities that do not affect the entire financial statement. In 2018, the Ministry of Defence was awarded the Unqualified Opinion (Reasonable without Exceptions/WTP) [4]. It remains difficult to gain a complete picture of off-budget sources of income in the defence sector, especially in ‘grey areas’, such as business networks that are managed outside of military institutions or the provision of security services by military personnel.

However, progress has certainly been made in terms of outlawing off-budget or non-budgetary revenue for the defence sector. A series of regulations has also been put in place to ensure accountable financial records of central government, including the defence sector. The Ministry of Defence is still allowed to receive grants from a number of sources, including foreign governments and regional governments [5,6]. Grants can either be planned or unplanned. Planned grants are included in the mid-term and annual plan of activities drafted by the Minister of National Development Planning each fiscal year. For unplanned grants, the Minister of Defence should consult the Minister of National Development Planning and the Minister of Finance before making any grant agreement. A request for authorisation of the registry number and grant account shall be made by the Minister of Defence to the Minister of Finance. Upon receipt of unplanned grants, Minister of Defence should revise the ministry’s budget. All grants received should be registered in the overall central government budget. All grants received by the defence sector should also adhere to the following principles: transparent, accountable and free from any political motives. In reality, details of grants are not published by the receiver (the government). In 2017, the Governor of DKI Jakarta revealed that the military is among their grant receivers, along with the police, local legislators and a number of civil society organisations [7]. The local territorial command received around 20 billion rupiah. The grant information was published on the government website (apbd.jakarta.go.id) and the governor clearly explained the grant application procedure. In 2020, the Ministry of Defence received a grant from the Manokwari Regent, in form of land and buildings [8]. The land will be used by the local territorial command. The above-mentioned grant case is known because the local government upheld the principle of transparency or happened to be covered by the press. Regardless, not all grant providers uphold the same standard of transparency. The Ministry of Finance only provides data on grants as a national aggregate, not per sector. The impact of this lack of transparency is causing concern among civil society.

The internal monitoring function within the Ministry of Defence is carried out by the Inspectorate General of the Ministry of Defence. The Ministry of Defence Inspectorate General conducts internal and financial oversight through audits, reviews, evaluations, monitoring and other supervisory activities using pre- and post-audit methods, as well as methods carried out during audits [3]. As they are part of an internal monitoring mechanism, the activities and documents resulting from the supervision and inspections that will be and have been carried out by the Inspector General of the Ministry of Defence are determined as exempt information in the Ministry of Defence, meaning that public access is limited [1]. Meanwhile, the government’s external audit is conducted by the Audit Board (BPK) [2]. As part of its duties, the BPK conducts an examination of the Central Government Financial Report (Laporan Keuangan Pemerintah Pusat/LKPP), which is the responsibility of the central government and concerns the implementation of the State Budget. The LKPP consists of budget realisation reports, balance sheets, cash flow statements and notes on financial statements. The LKPP is a consolidated financial statement of ministries and institutions, including the Ministry of Defence. When conducting an audit, the BPK can utilise the internal audit results of the relevant ministries, in this case the Ministry of Defence [2]. The accountability report on the implementation of the APBN, which has been audited by the BPK, is then submitted to the DPR by the President. After Presidential Regulation No. 43/2009 concerning the Takeover of Business Activities of the Indonesian Defence National Forces was issued, the amount of TNI business as a source of TNI off-budget income was considerably reduced. It is difficult to gain accurate data about TNI activities. Even when TNI business activities exist, they tend to be in grey areas, for example, informal business networks involving families of TNI members, both active and retired. It is almost impossible to identify these activities in the financial statements that form the basis for inspections by the Inspectorate General and the BPK, despite their broad mandate.

Public scrutiny of various aspects of defence policy, including the defence budget, has begun to increase, especially since the reforms of the late 1990s. These reforms were primarily driven by the growing epistemic community and the expansion of technical and policy-oriented literature [1]. In addition, the wave of democratisation also opened up space for the emergence of vocal, independent media networks and relatively strong civil society groups [2,3,4,5]. Issues related to the defence budget and TNI off-budget income are also causing concern among the international community. In 2010, Human Rights Watch released the report ‘Unkept Promise: Failure to End Military Business Activity in Indonesia’, which carefully analysed the progress of the reform of TNI’s business activities, as well as a number of rules that were issued by the government at the time in order to accelerate reform. Prior to that, in 2006, HRW also issued the report ‘Too High a Price: The Human Rights Cost of the Indonesian Military’s Economic Activities’, which examined the humanitarian impact of TNI involvement in business activities. TNI business activities remain the subject of public discussion, although not as frequently as before. However, there is no public coverage of off-budget revenue. There are still a few examples of the media questioning TNI business [1], while other media outlets cover events in the TNI that provide an insight into how cooperatives are run [6]. In the case of grants from local governments, public scrutiny has been difficult because the central government does not publish details of grants per sector or ministry/body. Public scrutiny is only possible when grants are openly reported by providers, as in the case of the Jakarta regional government [7].

While non-central government sources of funding are available to the Islamic Revolutionary Guard Corps (IRGC) for example, information on the sources of funding are released selectively. As the IRGC has a business network, spanning numerous business sectors, there is not a full publication of income sources. Furthermore, there is no publication of information related to property disposal, nor arms sales, for example [1].

The mandate of the General Inspection Organisation of Iran includes the supervision and inspection of all organisations and institutions affiliated with the judiciary, military and all disciplinary forces. However, it is unclear whether its powers extend to non-central government sources of funding. [1]. Perhaps, there is some small amount of institutional scrutiny because previously, a commander, from the IRGC’s Khatam al-Anbiya construction base headquarters, Commander Abolghasem Mozaffari, in an interview to Iranian parliament’s website remarked about the company’s budget and spending [2]. However, any such scrutiny is likely to suffer from political influence so as to be unreliable. Please see the example [2, 3].

There is some scrutiny by the local media of non-central government sources of funding, but this is extremely limited, and neither inconsistent not in-depth [1]. Civil society organisations (CSOs) do not appear to be involved. For example, one conservative politician Ahmad, Tavakkoli, who is also the managing director of Alef news website, appeared at Branch 74 of the Criminal Court of Tehran on May 24 to address charges levelled against him over articles published on the website – seemingly speaking out against corrupt officials. Tavakkoli was sentenced to six months in prison on the charge of “insulting officials and the Judiciary.” The court decided to suspend the verdict “due to my background and status.” Criticizing his accusers, Tavakkoli said if the freedom of the press is violated, corruption will remain hidden [2].

Additional sources of defence income generated or received are not recorded online by Iraq’s defence institutions (1). All that is made available are budgetary allocations for security actors and institutions documented in Iraq’s federal budget law, but even that information offers an incomplete picture of income-generating activities. The draft budget law for 2019 was published by the local press (2) but was not supplemented by additional details of expenditure.

The MoD and its ancillary branches do not upload data relevant to overall operational expenses or additional income, separate to funds earmarked by the central government seated in Baghdad.
The Directorate of Military Accounts monitors accounts receivable and the audits of all bureaus belonging to Iraq’s military (1). Official pages managed by the Directorate do not refer to mechanisms of institutional scrutiny when managing additional sources of defence income. Further evidence on MoD income reveals “limiting funds” and “fiscal constraints” (2) which make Iraq likely to continue relying on foreign armament suppliers which might demote the importance of scrutinising funds that are unlikely to amount to anything substantial. Income generated from Iraq’s military repair factory in Taji is not made publicly available, but by and large, Iraq’s indigenous defence industry is feeble and poorly placed to generate substantial revenue. It must be emphasised that the MoD’s IG office is mandated to exercise oversight of external and internal income, but combing through relevant reports and coverage, no such evidence could be located.

Public scrutiny of defence income by the press and CSOs is common, it is also debated in parliament. For example, in a parliamentary session held in January 2019, trillions of Iraqi dinars generated by non-oil revenues remain unaccounted for, an emphasis was made about the need to monitor licensing and contractual agreements (1). Iraq’s local media often reports on corruption and the defence industry in general terms, and other articles offer in-depth insight into particular deals steeped in corruption (2), (3), (4). As noted by Abbas Sarout a member of Iraq’s parliamentary Security and Defence Committee, “estimated losses from corrupt defence contracts were equivalent to Iraq’s budget for three or four years” (2). Another report warns “widespread perceived corruption impacts utilisation of funds intended for new procurement” (5). This is corroborated by a military expert interviewed for the assessment, it is noteworthy that “details which could result in the imposition of penalties or judicial action, are often shrouded in secrecy, particularly in foreign procurement deals, involving allies with whom Iraq relies on for donations of military equipment or enters into contractual agreements with for supplies needed to maintain security” (6).

There are incomes from other than from central government allocation. Equipment sales for instance generate significant revenue. In 2020, the scope of Israel’s defence export contracts reached $8.3 billion, a 15% increase in the number of agreements signed compared to 2019 (1). SIBAT (International Defence Cooperation Directorate) is responsible for coordinating these sales and reporting on income (2). However, very little detailed information is released which provides a breakdown of this income and there is no publication of how this income is allocated, aside from general figures on total revenue and statistics by geographic distribution of exports (1). While the Knesset as some access to information on these sources of income, it remains limited and few are transparent to the public (3).

There are mechanisms of scrutiny in place and administered involving a central government department such as the supreme audit institution. However, the internal audit office within the defence ministry may either fail to scrutinise funding, or may not be allowed to release findings. It is very selective and information are not released systematically. Yet, it is monitored by the Minstry of Treasure, the State Comptroller and the Ministry of Defence (1) (2) (3) (4).

Public scrutiny of sources of defence income is extremely limited. No record of such scrutiny could be found in a review of media sources (1) (2) (3).

Sources of defence income other than those provided by the central administration are indicated in the annual budgetary law [1]. According to Section V of the Estimated State for the 2020 annual fiscal year [2], the large majority of incomes and available funds come from the Ministry of Economy and Finance. The only incomes from other sources are from the sale of products with the brand of the armed forces and incomes related to the use or sale of real estate properties and other goods.

Sources other than those assigned by the central government are managed by Difesa Servizi Spa, owned by the Ministry of Defence. As every enterprise with public ownership, the management and budget of Difesa Servizi Spa is scrutinised by the central audit office. [1] In addition, its statute provides for the discussion and approval of the annual budget by the management board (art. 21), as well as for a review of the budget performed by the internal supervisory board (art. 22), therefore foreseeing an internal control [2]. However, the release of findings was constant until 2018, when the dedicated website was last updated [3], hence it is not possible to verify the efficiency of the internal audit office.

Public scrutiny of non-central government sources of funding is almost non-existant. There is little evidence on public media of public scrutiny of sources of defence income, like a recent agreement to enhance sports facilities [1].

The general account budget, of which the Defence Budget is a part, is to be funded primarily by taxes and public bonds. [1] The Japanese Government publishes a disaggregated settlement of accounts that shows income and expenditure. The largest income categories in this budget are taxes and sales of government bonds, but the income generated by each ministry is also listed. The settlement of accounts for 2017 shows that the Ministry of Defence (MOD) generated an income of about 49 billion yen, which is less than 1% of the expenditure of the same ministry. The list of incomes for the MOD also includes the items sales of government assets and sales of equipment. [2] However, most defence equipment is categorised as administrative assets, which it is illegal to sell. [3] They must be converted to non-administrative assets, at times by having changes worked on them before they can be sold. The income from such sales enters the national treasury, which is under the administration of the Minister of Finance. [4] An examination of sources cited does not give any reason to doubt that, in the defence sector, there is full publication of all categories of income, the amounts received in each category and the allocation of this income (to the national treasury). However, there is not full clarity about each separate asset disposal (see Q24A).

The Board of Audit of Japan is independent of the Executive and is in charge of auditing government expenditure. [1] It publishes an annual report on the audit of the accounts of the MOD and on the audit of the performance of the ministry that examines whether its work can be done in a more efficient manner. Regarding topics that relate to defence income, the audit of the accounts for fiscal year 2016 raised the issue of correct registration of the value of defence assets in the ledger of national assets, and quicker refunding of the surplus of funds prepaid to the US Government for arms procurement under the Foreign Military Sales arrangement. [2] The audit of the accounts for fiscal year 2015 discussed cases related to the registration of the value and the sales of defence equipment. [3] According to regulations, an internal audit is to be conducted in the MOD annually, and those conducting the audit are to report its results to the Minister of Defence. [4] It is not clear whether the findings of the internal audit are classified as secret information. However, regulations on classification as secret are, according to the Compliance Guidance, [5] found in Ministry instructions. According to these instructions, facts, texts, charts and items relating to the operations of the Self-Defence Forces (SDF) or estimates, plans or research on such operations must not be revealed to personnel who are not involved in them. [6] As no information on the results of internal audit by the MOD [7] were found in a search of its website, it must be assumed that this information is classified as secret.

Aside from small amounts of income from sales of used military equipment and military property assets, no indications were found of non-central government sources of funding for the defence. Neither did a search of the mainstream newspapers Asahi [1] and Yomiuri [2] uncover any cases of public scrutiny of such sources of funding, indicating that such scrutiny is minimal. In 2020, the Ministry started to auction used military equipment, and this was reported in the media. [3] [4]

The official website of the Jordanian Armed Forces, under the Developmental Role section, lists several entities and companies that provide income to the defence sector in Jordan [4]. However, none of these on the list have been audited by the Audit Bureau [5]. Defence income other than that coming through the central Government is not published regularly [6,7].

There is some information available through non-official sources about the military assistance provided to Jordan through Canada, Germany, the UK and the US. This information, however, sporadically circulates through public statements [1], donor governments’ official websites [2], and/or western media reporting [3].

Jordan is a country of limited resources and depends on donor countries to provide Military AID (USA, Germany, Canada,….etc).The amounts of these grants are well known and puplished either by the donor countries or through official channels since all this income is governed by Cooperation agreements signed on official levels [8]. According to our sources, there is a selective publications and disclosure of the amount of funds/ money recieevd by the MoD’s runned businesses[9].

There are several sources of revenue for the defence establishment in Jordan beyond the central government budget, including revenues from the operations of the King Abdullah Design & Development Bureau (the industrial manufacturing arm of the Jordanian Armed Forces); the re-sale of old equipment; and income from projects carried out by Mawared and the Development Investment Projects fund (DIP), both of which are primarily involved in commercial and residential development using land that was previously reserved for military purposes but is now extremely valuable suburban real estate. None of the revenues generated by these entities is published, and they are not included on the list of entities subjected to audit by the Audit Bureau. This is despite the fact that they meet the 50% threshold for government ownership that should trigger an official audit and their employees meet the definition of ‘public sector’ worker that should, in theory, subject them to the same legal code applied to state officials. The Army’s industrial conglomerate the King Abdullah Design & Development Bureau/KADDB has also received direct government funding (of about $12 million/year as of 2008). KADDB does, however, employ individuals trained as accountants and financial managers, but whether this personnel is tasked with internal monitoring of accounts for corrupt transactions is unclear. [10].

There is no institutional scrutiny over additional income of the defence forces. No governmental committee or organization scrutinize military state-owned businesses and semi-private entities [1,2].

Sources of defence income other than those from central Government are not fully disclosed and are not accessible to the public. Furthermore, this lack of public scrutiny in relation to defence income can be explained through the legal provisions that make such public scrutiny illegal [1]. In addition to that, in 2016 the Armed Forces prohibited the publication of any information related to it, and this includes its sources of income [2].

Treasury publishes goverment revenue, grants and loans for every financial year. This includes actual receipts for previous two years, printed and revised estimates for previous financial year as well as projections for the next three years. [1] This covers various sources such as revenue from sale of goods and fee for services, sale of tender documents, fines and forfeitures, sundry revenue, grants from international organisations through the Exchequer. However there are notable legal provisions that are often used to limit disclosure of information to the public, such as section 40 of the Kenya Defence Forces Act, of 2012, and part IV, section 40 (1), (2) and (3) of the Public Audit Act No. 34 of 2015, which are used to withold confidential information to the auditor general when auditing national security organs in the interests of safeguarding national security. [2, 3]

It is important to note that it is entirely clear why Ministry of Defence witholds information from auditors. [4] For instance in the 2016/17 audit report of MOD, the auditors noted various breaches of procurement rules yet during parliamentary review of the same audit processes, MOD supplied the documents to the parliamentary committee and who recommended that in future, the ministry should avail all necessary documents to auditors. [5] Moreover, MOD has in the past classifed some issues as sensitive to national security as provided in the KDF Act and sought to have scrutiny by parliamentary committees done in closed session away from the public. [6]

Parliamentary committees have in the past raised concerns over the limited information provided by MOD on expenditures. [6] Furthermore, Civil societies such as Transparency International in Kenya and the African Centre for Open Governance have in the past attempted to challenged the constitutionality of the laws used to prevent scrutiny of security institutions and had them declared unconstitutional by the the High Court in 2018. [7] Despite this ruling, KDF continues to deny the Auditor General from access to accounts and procurement processes.

There are mechanisms of scrutiny in place. The Office of the Auditor-General is a constitutionally mandated office to conduct audits of all public instititutions, including the Ministry of Defence (MOD) and Kenya Defence Forces. [1]

In addition, the Ministry of Defence has an internal audit division that scrutinizes the ministry’s asset management, cash management and procurement among other roles. [2] There is limited information on how internal scrutiny is conducted and there are no instances where the the auditor-general has reviewed non-central government income to MOD.

There is a considerable level of public scrutiny, especially on expenditure, on both KDF and the Ministry of Defence largely by Parliament. Parliament’s Budget Appropriations Committee and Public Accounts Committee are the main entities that have oversight on MOD budgets as well as the the exchequer where funds earned by public institutions are received and accounted. There are non-governmental organisations, such as the African Centre for Open Governance, and Journalist for Justice, and the media who have in the past taken a proactive role of scrutinising matters related to misuse of public funds within security institutions in general. [1] [2]

Other institutions include the Institute of Economic Affairs, who also examine economic policies such as national budgets, accountability in expenditure. However, due to limited information from security institutions in general and the defence sector in particular, it is extremely challenging for non-governmental oversight institutions to scrutinise the defence sector. [3] Most of these institutions rely on information released by both the ministry and through independent commissions. Therefore, a lack of information does impact on the ability of these institutions to conduct oversight roles. Nevertheless other institutions such as the media provide a plattform where issues on accountability are shared. [4]

The Law No. 06/L-133 on the Budget Appropriations for the Budget of the Republic of Kosovo for Year 2019 outlines the state budget allocated for the Ministry of Defence and the Kosovo Security Forces, as well as outlining funding sources. Sources of funding are therefore listed as the following: own sources, debt, and revenue from Privatisation Agency of Kosovo [1]. Additionally, other financial support in the form of donations that the Ministry of Defence and the Kosovo Security Forces receive through bilateral cooperation with different countries or other means are made public by the Ministry of Defence through its annual reports [2].

According to the current legal framework in Kosovo, the National Audit Office (NAO) is entitled to audit all financial activities; administrative activities; and programmes or projects managed by one or more of the national institutions [1]. The NAO has the right to trace public funds to the final beneficiary [1]. It is important to note that the NAO is obliged to annually carry out a statutory regularity audit of the Government Reports on the Kosovo Budget, and of all other Budget Organisations that directly received a budget in the Annual Budget Law and who produce Annual Financial Statements [1]. Furthermore, the NAO has the right at any time to carry out other audits of any institutions handling public money, Public Private Partnerships, loans, credits or liabilities guaranteed by public sector entities [1]. Ultimately, the NAO may conduct – upon a written request from a donor or organisation – an audit of funds donated by that donor or organisation to the Kosovo institutions; provided that an agreement is reached with the donor or organisation to cover the costs of the requested audit [1]. The NAO has unrestricted access to all information that it deems necessary for audit purposes, and is entitled to full and free access to property or documents in order to audit at any time, whether on paper or in electronic form [2].
Beside the NAO, the Internal Audit Unit scrutinised funding which is not related to central government [7].

Media and civil society rarely challenge funding directed to the Ministry of Defence and Kosovo Security Force by the non-government sources.

The monthly and yearly reports (1, 2 and 3) of the Finance Ministry on the budget and spending of the security agencies do tell the public how much the security agencies received that did not come from the central Government budget. They break down the figure to a number of sections like “property disposal” without further details, but they do not say how that money is spent..

The Finance Ministry also performs this function with all other Government agencies and always fails to include the allocation of the funds in its report, so the lack of transparency here may not be the result of intimidation from the security agencies.

Officials and activists say there is no reason to believe that the reporting process is selective (4, 5, 6, 7 and 8).

In fact, there has been a rumour making the rounds in Kuwait about auditors getting assaulted and verbally abused in unnamed Government agencies when they asked to view their records since 2016. Waleed al-Tabtabaki, a lawmaker, formally asked the Finance Minister to respond to these claims in May 2018 (9).

Like all other financial transactions, these practices fall under the scrutiny of the SAB, and the finance department of these agencies, which are under the control of the ministers. These departments may fail to review the funding and they may not be allowed to do so. They are not allowed to release their findings to the public, external auditors say (1, 2 and 3). Often, they are uncooperative with external Government auditors or simply do not have information on the matter because the ministers have the right to control and limit their scope of work, according to article 24 of the police law and article 27 of the military law (4 and 5).

The Kuwaiti public and media seem to have no awareness of these activities, according to activists, journalists and officials (1, 2, 3, 4, 5, 6 and 7). There are virtually no news stories on the matter and only people who have studied corruption in Kuwait or who have experience with the Government know that these practices exist in the first place.

It is worth noting that the lack of public and media scrutiny here should not be completely blamed on the Government, however, because these operations, at least in the defence and security sector, are small and have little impact on the overall budget of these organisations and that is why activists consistently prioritise other issues.

There is a full annual publication of all expected sources (e.g. utilisation of real estate, services provided in geospatial issues) and amounts to be received, [1,3] while the income is allocated to the general budget. Complete information is available to the State Audit Office [2].

Mechanisms of scrutiny are in place and administered by the Audit and Inspection Department of the Ministry of Defence, as well as by the State Audit Office. The same audit procedures apply to income from internal sources and central government allocation. [1]

Given the limited amount of income of this sort (approximately 0,31% of the total defence budget for 2018), [1, 3] is has not been subject to considerable public debate. The State Audit Office has not identified major issues in this regard, and thus has not turned the attention of the public to such issues. [2]

Some publications of donations and military assistance by media outlets cover donations coming to the LAF. Donations in the form of military assistance by countries include military equipment to support the LAF (1). Donations and equipment delivery is also published on the LAF website (2). Furthermore, all donations need to be approved in the form of a decree by the Council of Ministers. The decree is then published in the official gazette (3). However, the official gazette is not free; a yearly subscription for the electronic version of the gazette costs $366 (4). On the other hand, donation decrees by individuals and foreign countries are sometimes published on the Lebanese University’s research centre website under “legal texts” (5). Even though the MoD does not fully publish sources of defence income, almost all donations received are in materiels and good and not monetary, information on these donations is available from the donors (especially the USA and major military aid) (6).

According to our sources, the Parliament does not scrutinize the non-government resources that are not included in the budget. The decrees are approved by the Council of Ministers (1), (2). According to a source, an internal review process exists within the LAF (3).

Public scrutiny is non-existant for non-central government sources of funding (1). Usually, public scrutiny is aimed at the defence budget expenditure because it is the biggest one within the state budget. Almost 80% of the defence budget is spent on salaries and wages (2)

In the financial reports of the Ministry of National Defence, sources of income are normally divided into four parts: central government, municipalities, the European Union, and international organisations and other sources [1]. According to the government reviewer, the amounts by this four parts of incomes are provided in such particularity: the balance of amounts at the beginning and end of the reporting period; amounts received, amounts used, amounts transferred and amounts returned. The overall amounts received are published; however, the source of some income allocations is not always clear [2].

The Ministry of National Defence has a centralised internal audit department that analyses and assesses how effectively financial and material resources are used. The audit department prepares internal audit reports and recommendations as well as the annual work programme and activities report [1]. The National Audit Office of Lithuania is a supreme public audit institution in Lithuania, which is accountable to the Seimas (unicameral Parliament). It carries out audits regarding state budget implementation, use of state funds, as well as financial and performance audits (public audits), which also falls under the jurisdiction of the Ministry of National Defence [2].

Media covers extensively defence expenses. For instance, it widely covered the procurements when the Lithuanian army bought kitchen items for around eight times the market price in 2014, dubbed by the media as the “golden spoons” [1, 2]. However, journalists rarely analyse financial flows of the defence institutions and instead report after the investigations have been carried out by relevant monitoring institutions.

The totality of the Ministry of Finance (MINDEF)’s budget comes from the central government and there are no other sources of defence income. All proceeds from equipment sales or property disposal are collected into consolidated funds, which do not belong to MINDEF. The consolidated funds are typically used for scholarships for the purposes of training and education. [1]

The totality of the Ministry of Finance (MINDEF)’s budget comes from the central government and there are no other sources of defence income. All proceeds from equipment sales or property disposal are collected into consolidated funds, which do not belong to MINDEF. [1]

The totality of the Ministry of Finance (MINDEF)’s budget comes from the central government and there are no other sources of defence income. All proceeds from equipment sales or property disposal are collected into consolidated funds, which do not belong to MINDEF. [1] The defence budget is available to the public, and public discussion takes place via the mainstream media, online blogs and social media platforms. [2,3,4]

SIPRI’s report from 2006 notes that the use of off-budget income to supplement defence spending is routine.¹ The Malian armed and security forces have a statutory duty to participate in public works as part of their contribution to the economic and social development of the country. These activities primarily occur in sectors considered to be not lucrative enough for private companies. However, they serve as revenue-generating ventures for the military whose costs are substantially lower. Private enterprises attached to military units – such as restaurants and leisure facilities – and Malian troops’ participation in peacekeeping operations also generate income for the Ministry of Defence.¹ Yet none of these income streams appear in the budget, nor is there any evidence that this income is published elsewhere. The assessor has not found more recent evidence.

There are several internal and external bodies tasked with auditing the finances of the Defence Ministry (see Q16). However, there is no evidence that these actors are able to properly scrutinise off-budget incomes. Moreover, analysis of the BVG, IG, and National Assembly show state capture across the oversight bodies.¹

The failure of the government to publish accounts of the income derived by the Ministry of Defence from participating in projects such as peacekeeping activities and undertaking public works prohibits any kind of public scrutiny of such revenue streams.

The regulations indicate that agencies, in this case, SEDENA, must submit a report to the SHCyP on the income they have received for products and services that they provide to the general public, as well as for the sale and compensation of movable property, both inventoried and not inventoried. [1] However, this information is not available to the public.

It is possible to find isolated information without much detail about some disposals made by SEDENA and Banjército, for example. [2] [3]

There is no institutional scrutiny of non-government funding sources. The annual reports of the public accounts by the ASF do not refer to this type of income. [1] [2] This implies that they are not held accountable and there may be diversion of resources in such controversial issues as the sale of arms.

Public scrutiny of non-government sources of SEDENA funds is non-existent. Few documents indicate SEDENA’s earnings from the sale of arms, the sale of livestock, or of basic necessities, for example. [1] [2] However, they do not analyse or question the destination of these resources.

According to the State Audit Institution, the Ministry of Defence failed to properly report income from renting and selling property in 2016 [1] and 2017, [2] while their report for last year has not yet been completed. Only general information on allocation of income is provided in financial reports on budget expenditures provided by the Government to the Parliament.

The State Audit Institution conducts an annual revision of the budget of the Government and all units, including their non-central government funding. [1] However, the Institution conducted only a few audits of the Ministry of Defence – in 2017 it audited the Ministry’s asset management, [2] in 2014 internal controls and procurements of the Ministry [3] and in 2008 the Ministry’s annual financial report for the previous year. [4]

The independence of the State Audit Institution has been reduced due to the appointments of politically exposed persons in its Senate in recent years. [5]

Important information about defence income and expenditures is not publicly available, and therefore not exposed to public scrutiny. [1] For example, only total amounts of income and expenditures related to secret procurements is available in the annual budget expenditure reports of the Government. [2] Only a few NGOs deal with defence, and they lack the capacity to address all relevant areas, including finances. [3]

According to the 2018 Budget Law, only one isolated article entitled ‘Various income’ (ref. 1.1.0.0.034.000) refers to income sources that come from outside central government allocation (1)(2).

No evidence that information about income sources other than from central government allocation was found in the local or regional press. (3)(4)(5)(6)(7)(8)(9).

No evidence of institutional scrutiny (such as from bodies referring to the High Commissioner’s Office for Planning, the General Treasury, or the National Audit Office) of non-central government sources of funding was found (1)(2)(3)(4)(5).

No evidence of public scrutiny of non-central government sources of funding by national and international media was found. (1)(2)(3)(4)(5)(6)(7)(8)(9)(10).

No evidence of public scrutiny of non-central government sources of funding by CSOs was found. (11)(12)(13)(14).

One can therefore conclude that public scrutiny of non-central government sources of funding is non-existent.

According to the report submitted by the Independent International Fact-Finding Mission on Myanmar, Myanmar Economic Holding Limited (MEHL) and the Myanmar Economic Corporation (MEC) are Tatmadaw-owned public and private limited companies. The patron group of these conglomerates is comprised of the military’s top officials. MEHL and MCP contribute to the military’s budget. The flow of budget from both MEHL and MEC lacks transparency [1]. Major-General Zaw Min Tun, spokesperson for the military, stated that these companies are public companies for the benefit of retired and current military personnel and their families [2]. But detailed information is not available to the public. A spokesperson for the government refused to comment on military business [3].

Before 2016, Myanmar Economic Holding Limited (MEHL) and the Myanmar Economic Corporation (MEC) did not pay taxes to the government and had special benefits, such as no competition in the tender process [1]. The Union Auditor General Office has no authority to investigate or scrutinise defence spending and there is nothing about the defence sector in the annual report submitted by the Union Auditor to Parliament [2]. So, a mechanism for scrutiny of military-owned business is impossible. The Account Department under the Ministry of Defence conducts the audits for the defence sector [3].

The media, think tanks and international organisations often scrutinise and criticise businesses owned by the military. The Independent International Fact-Finding Mission on Myanmar published a report on the economic interests of the Myanmar military, which included a chapter on mapping Tatmadaw economic structures and interests [1]. Media outlets, such as The Irrawaddy and BBC News, often write and publish articles relating to military business [2,3]. Think Tanks like United States Institute of Peace, published the papers that criticize the transparency of the military owned business [4]. Justice for Myanmar is a very active organisation that can scrutinise defence procurement, military conglomerates and illegal acts by generals [5].

Article 105 of the Constitution requires all sources of income to be published and scrutinised [1]. The annual defence budget shows income figures associated with ‘revenue from strategic infrastructure sales’ and ‘sales proceeds from strategic equipment’ [2]. This income is factored into the Ministry of Defence’s annual reports, including a designation for the funds [3]. Parliament is often informed of the sale of equipment and land separately [4]. However, in 2020, a batch of small arms worth over 168,000 euros was sold and Parliament was not informed [5]. The trade was highly controversial because the arms ended up in the Maltese arms trade [5].

Article 105 of the Constitution also requires the balance sheet to be approved by the Court of Audit and presented to the States General [1]. All the income of the ministries is scrutinised by the independent audit service of the Ministry of Finance [2]. The recent Court of Audit’s report ‘Out of Sight’ exhibits a critical perspective on sources of defence income [3].

The public scrutinises the income of the Ministry of Defence, specifically that which is earned through the sale of equipment and arms. For example, in 2020, when hundreds of Dutch arms were found in Malta following a controversial deal, media organisations and the public responded to the controversy [1,2].

All Crown income is reported to the Treasury on a monthly and annual basis and published online [1, 2, 3]. Financial details for the Ministry of Defence and NZDF are also published in their Annual Reports [4, 5]. All sources of income including equipment sales and property disposal for the New Zealand Defence Force are published and scrutinised by a variety of stakeholders. The Treasury and Parliament are provided regular detailed reports and all income is scrutinised by the Office of the Auditor-General (OAG) and the Finance Select Committee. The annual report is published and publicly available which includes detailed notes of income received from various sources [6].

The Office of Auditor-General undertakes review of Government financial and administration compliance and has both auditing and controller functions [1]. Its role and functions are established within the Public Audit Act 2001 and the Public Finance Act 1989 [2, 3]. Their Briefing on the Defence Sector is made public via the Parliamentary website [4]. Additionally, the Treasury regularly publishes the Financial Statements of the Government online, which includes the Ministry of Defence and the Defence Force [4]. Additional mechanisms are in place within the NZDF for disposal of major items to ensure that decommissioned assets are disposed in accordance with the agreed contracts. As an example, the New Zealand Defence Force sent an investigatory disposal team, along with personnel from MFAT and the Environmental Protection Authority, to Alang in India, to ensure that the former HMNZS Endeavour was properly recycled [5, 6].

The Government Defence sector does not derive much revenue from sales due to its small size. However, when the opportunity does arise, scrutiny is present, such as the disposal of inshore patrol vessels in 2016, and the potential sale of Devonport Naval Base in 2018 [1, 2]. It would be highly improbable that any sale of significant items or systems would go unnoticed in New Zealand.

There is no defence industry in Niger, and the military does not own any property that could provide it with additional income or revenue (1). However, Niger receives important assistance from its main international partners. The type of assistance depends on the partner and may come in the form of military and police specialised training or gifts like armament, ammunition, military equipment etc. The cooperation is set up on a bilateral level – with the United States, France and Germany – as the main partners, and on a multilateral level – mainly with the European Union and the United Nations (2). The information regarding the content of the cooperation is accessible on the websites of Niger’s partners as well as in reports by think-tanks working on the Sahel region (2); it is also occasionally published in press-releases (4, 5) or provided in official interviews with Nigerien ministers or high-ranking civil servants (6). Information on the provided assistance is centralised in the Office of the Chief of the General Staff of the Armies (Etat Major des Armées), but it is not accessible to the public.

The Defence Ministry’s internal oversight body – the Office of the Inspector General of the Armed Forces (IGA) – provides a scrutiny mechanism (1). Depending on the Presidency (see question 8), it ensures that all relevant administrative, financial and budgetary rules and standards are applied and respected and that public resources are managed in a transparent, efficient and cost-effective manner (2). Within the Ministry of Defence, there is also the Office of the Inspector General (IGS, Inspection Générale des Services), which acts as a control structure within the internal administration of the Ministry (1). Its equivalent also exists in other Ministries.

Civil Society Organisations (CSO) occasionally participate in defence and security debates. For example, every year, AEC organises a forum “Session Budgetaire Citoyenne” to discuss upcoming financial law, where defence and security budget is also debated (1). Sometimes, the criticism provided by some organisations may lead to the arrests of their leaders (see the example provided in question 4, sub-section CSO protections). Therefore, even if a debate is taking place, defence and security policies remain the government’s prerogative.
The debate also concerns mainly sources coming from the central government. At the same time, assistance from cooperation with its main international partners may be considered as an important source of income from non-central government sources. As explained previously (see Q3), the extent of international military presence in Niger remains unclear.

Technically there are only a limited number of sources of income from commercial companies such as DICON as the defence sector is not primarily a revenue-generating institution. However, a few miscellaneous units exist which generates some revenue such as the officer’s mess for example. If military assistance from foreign donors is given, it is unlikely to be recorded in the national budget, but such assistance normally involves technical assistance, training and equipment (1). Where there is foreign aid in financial terms, it is rarely included in the budget. Remittances from other income sources are not remitted to the single treasury account following the Single Treasury Account policy which requires all revenues from government agencies to be remitted to the central account. The publication of extra-budgetary revenue is uncommon (2).

The Daskigate corruption scandal was mainly uncovered by a special audit committee created by President Buhari to investigate defence spending between 2007 -2015 (1), (2). It is unlikely that the Audit Office carries out scrutiny of non-budget sources of income as the proceeds from such units are not deposited with the Single Treasury Account (TSA) (3).

There is no evidence of scrutiny of non-central government sources of funding. CSOs have no access to this information and compliance with the Freedom of Information Act is very low in the defence institutions (1).

At the end of each year, the Ministry of Defence publishes its final financial balance sheets in which all sources of income are disclosed and available on the Ministry of Defence website [1]. Sources from self-financing activities are broadly separated into immaterial or material. The latter includes material goods; natural resources; infrastructure (i.e. buildings, apartments and business facilities); catering services; recreational facilities; equipment etc. Revenues from the Ministry of Defence sales are also included in the financial sheet. In sum, all sources of income are published. The revenues from this type of income are first directed to the Treasury. The reallocation of the proceeds back to the Ministry of Defence is decided by the Government [2]. Precise information on the specific allocation of this type of income, in particular for defence purposes, is missing.

The Internal Audit Department (IAD) as well as the State Audit Office (SAO) scrutinise the Ministry of Defence’s financial reports, including non-central income sources. The IAD has unrestricted access to all activities (including self-financing ones) undertaken in and by the Ministry of Defence [1], while the SAO audits the Ministry of Defence’s budgetary account including all self-financing activities, the balance of income and expenses as well as changes in sources of capital assets [2]. However, the IAD reports are not publicly available as they are clasified [1]. On the other hand, the SAO reports are published on the Ministry of Defence website but the last update is from 2014 [2].

There is no evidence of public scrutiny over the Ministry of Defence’s non-budgetary sources of income.

All sources of defence income are published in the defence budget [1]. The information is disaggregated for the Ministry and subordinate agencies. All income from equipment sales and property disposal is returned to the defence budget at large. The Norwegian Parliament authorises the Ministry of Defence to divert possible surplus income to exceed the approved budget, but with certain exceptions. Military fines cannot be used to exceed the budget, and only 75% of income from sale of military material may be used on acquisition or maintenance of military material. The rest of surplus income has to be allocated for the nest year defence budget. In addition, the annual revenue from state-owned companies, including AIM, is made public in the ‘State ownership’ report, published every second year [2].

Audit over government income is provided by the Office of the Auditor General on an annual basis [1]. The Internal Auditor Unit at the Ministry of Defence may also conduct such an audit, but this is not a regular practice [2].

Online searches of the media indicate that there is no considerable and consistent scrutiny of sources of defence income either by the media or by CSOs. The main reason seems to be the fact that Norway is considered to be one of the least corrupt countries in the world and the public trusts the system of parliamentary oversight and scrutiny by the audit institutions. However, when the media uncovers mismanagement and/or wrongdoing, there is at times quite extensive coverage of both equipment sales (e.g. of boats to Nigeria) and property sales gone awry [1, 2].

Published data on external defence income is sparse, state income (not solely defence) beyond central government allocation derives from the country’s Petroleum Resource Fund and Oman’s Investment Fund (sovereign wealth fund) according to Gulf News Banking (1). Moreover, in efforts to diversify the economy plans to privatise six-state businesses, which will see an increase in investment program revenues (2). However, no reference to defence income appears across media outlets (1), (2), (3), (4) or either the Ministry of Defence or the Ministry of Finance (5), (6). The lack of public information available on the defence sector budget undermines transparency. According to our sources, external income to the government or the defence, in particular, are never published. No information is available for the financial department at the armed forces either on external income as the budget comes from the ministry or the sultan’s office (7), (8).

As established in sub-indicators 13A/B, there is no legislative committee charged with scrutinising the defence budget or defence expenditures. Though anti-corruption legislation is laid out clearly with regards to bribery in Oman, in accordance with the penal code (Royal Decree no. 7/74) and the Law for the Protection of Public Funds and Avoidance of Conflicts of Interest (Royal Decree no. 112/2011), there is no clause regarding external income or, despite the State Audit Institution and the Economic and Financial Committee, a mandate for institutional scrutiny (1), (2). There is no reference about external sources of defence income (3) beyond the central government, as explained in sub-indicator 15A. This demonstrates that there is no institutional scrutiny of non-central government sources of funding.

Civil society is severely limited in Oman (1). “Public scrutiny” only exists in cases where citizens are accused of defaming the sultan by the Omani state and thus their critique is shared (2), (3). Moreover, cases upheld against activists scrutinising corruption no explicit mention is made about defence, defence spending, or security. It is, therefore, difficult to speak about public scrutiny when there is no transparency of central government defence income in the first place. According to our source, there is no public scrutiny at all on the defence budget that includes the governmental income, or non-central government income (4), (5).

There are only certain items within the budget that refer to income sources, and no information is released on the amounts received or the allocation of this income that mainly comes from international donations, such as the USA (1). There are a few situations where the income of the military and defence units is published (3). These occurrences happen when a foreign country announces that they are funding security sector or national forces (2).

In most cases, projects financed by donors are not implemented through the Palestinian financial systems. No direct payments are made. It is therefore not possible to provide a mechanism for inclusion in the budget. All assets that are made available are disclosed following approved registration systems (4).

As most of the national forces/intelligence services are affiliated with Fatah and have international and regional connections, scrutiny is affected by how much influence those leaders have. More financial and personal resources mean more power to wield undue influence by the person (1), (2).

Public Scrutiny and consultation over resources and public issues are minimal to non-existent in general, and on national forces and security issues in particular (1). The funds usually go to vehicles, salaries and police operations which do not seem like significant issues for the public. The largest part of the budget of the national force goes to salaries (2). There are some papers and conferences that discuss issues related to the work and priorities of the security sector (3), (4), (5).

Publication of income sources is limited and selective. Proceeds from the properties being disposed by the state-run Bases Conversion and Development Authority (BCDA) go to the AFP modernisation programme as noted in the BCDA charter [1, 2, 3, 4].

Proceeds from asset disposal through the BCDA are subject to the scrutiny and independent review of the Commission on Audit [1, 2]. The Internal Audit Unit within the Defence Department does not conduct scrutiny of non-centralised funding [3].

Public scrutiny exists, including by the media and CSOs, but is not always in-depth or consistent; this is in part due to the lack of clarity and accessibility of certain parts of the defence budget already mentioned [1, 2, 3].

There are two such sources of defence income:
– Modernization Fund of the Armed Forces [1].
– Financial surplus of the Military Property Agency [2].
Their income includes revenues from equipment sales, property disposal, MoD contractor fines, payments from foreign armed forces using Polish polygons and infrastructure.
Financial plans of the fund and the agency are amendments to the state budget [3]. The financial plans, as well as their execution, are published and are the subject of an annual external audit by the Supreme Audit Office, together with the annual defence budget execution audit [4]. Sources of income, the amounts received, and the allocation of this income is publicly available.

Both aforementioned financial plans, as well as their execution, together with the annual defence budget execution audit, are the subject of an in-depth annual external audit by the Supreme Audit Office [1].
In 2017 the execution of the plans were not subjected to an internal MoD audit [1].

There is some superficial public scrutiny performed by the media [1, 2, 3]. There are no signs of CSO scrutiny.

Sources of income amounts received and allocations are fully published according to prevailing budgetary norms across all programmes [1], including defence sector information [2, 3]. This includes sources of income other than central government allocations, as provided by pages 32 to 36 of the Classifiers and Tables of State Budgets [1]; there is evidence of income other than central government allocation [3].

Budgetary execution is scrutinised (refer to Q14B), albeit with some delay accounted for by the law [1], and scrutiny is documented across the Directorate-General for the Budget [2], the Budgetary Monitoring Technical Unit [3] and the Court of Accounts [4].

Scrutiny is limited to non-sectorial monitoring by the Portuguese Council of Public Finance [1]. The Open Budget Partnership also performs some scrutiny [2], but none of these is specific to defence institutions.

There is evidence that the defence sector has sources of income other than those allocated through the central government, however, there is no publication of non-central government sources of funding. Information on non-central government defence income include the first defence and security company (Barazan Holding) established by the Ministry of Defence and headed by Khalid Al-Attiyah, Defence Minister [1]. In addition to that, the Qatari Military owns a company called ‘Qatar Armed Forces Investment Portfolio’. Registered in Luxemburg, the company is a commercial entity owned by the armed forces and generates income through real estate [2]. Information about non-governmental sources of funding has been obtained through media outlets as opposed to official government websites. According to our sources, the Qatari Armed Forces have other sources of income, yet the amount is not published [3,4].

Information about sources of defence income, other than from central government, are not made public through official means. Institutional scrutiny over non-central government defence income is, therefore, non-existent. According to our sources, there is an internal financial auditing unit who is responsible for the auditing process but not for scrutiny [1,2,3,4].

Public scrutiny of non-central government sources of funding is minimal or non-existent. Qatar’s strict rules on freedom of expression forces the public, journalists and academics to exercise self-censorship. Speaking against the government, or critiquing its policies, may lead to imprisonment. Individuals may have, to a limited extent, some freedom in the private sphere. In Qatar, there is no public deliberation when it comes to policy making, and therefore, there is a complete absence of public scrutiny over any type of policy, budget or otherwise [1,2].

There is no information about non-central government sources of funding [1]. The MoD departments of fincancial procurement[2], financial planning [3], social guarantees[4], military-economic analysis [5], financial monitoring of GOZ [6], or fincancial procurement planning for obilization deployment [7] do not publish any information about their income. The Federal Treasury only publishes information about state-allocated sources [2].

The Accounts Chamber audits the incomes of the MoD [1] and, in particular, has created a methodology to calculate the incomes within the Ministry. The subsequent MoD Order No. 240 as of April 24, 2017 ‘On planning incomes to the federal budget’ [2] provides calculation formulas for incomes administered specifically by the MoD. They include penalties for violation of GOZ requirements, for example, royalties of archival institutions, or the lease of immovable properties. While the Accounts Chamber regularly uncover expenditure violations [3], internal MoD departments have not provided any reports regarding defence incomes.

Due to the high level of secrecy of the MoD budget in general and its incomes in particular, the public’s ability to scrutinise non-central governmental sources of funding is close to none. Media and civil groups usually publish post-factum reports about embezzlement or other violations in the companies that acted as GOZ contractors for the MoD [1]. Usually, these violations are uncovered during anti-monopoly audits, tax audits [2] and special investigation operations [3] by the state agencies.

The government does not publish sources of defence income other than from central government allocation. The military and defence sectors do not currently represent a significant source of income in the country, with Saudi Arabia being a net military spender rather than generating income from this industry (1), (2). However, the country plans to localize 50% of its defence spending by the year 2030 (3). According to government literature, as part of these plans, Saudi Arabian Military Industries (SAMI), a military industry company formed in May 2017, aims to generate SAR 5 billion worth of exports by that year (4). Neither SAMI nor the General Authority for Military Industries, another government-industry body formed in August 2017, have published specific financial details relating to their activities, and it is unclear if they will do so in the future.

According to our sources, there is no institutional scrutiny of non-central government sources of income by either the Consultative Council or any other government body – though as mentioned above there is no significant source of income currently for this sector other than central government allocation. Besides that, there is no non-central government income generated by the military (1), (2).

There is no public scrutiny of either central or non-central government sources of funding in the country; there is no culture of open debate on or scrutiny of most government-related issues in the local media or discourse, as this is unofficially circumscribed by the government and would likely lead to reprisals against citizens (1), (2).

MoD income is published within the general national budget, but only in an aggregated form, without specifying the sources. The income sources are divided into several categories: 1) budget appropriations, 2) independent income, 3) donations, 4) income from nonfinancial assets, 5) unallocated surpluses from the previous period [1]. According to MoD, the revenues of the Ministry within the general state budget are presented by sources of financing in accordance with the provisions of Article 8 of the Rules on the Standard Classification Framework and the Chart of Accounts for the Budget System (Official Gazette of the RS, No. 16/16, as amended) [2].

There are active and independent mechanisms of scrutiny: the MoD Internal Audit unit and the State Audit Institution (SAI). In 2016 the SAI performed the audit concerning the independent income of several public institutions, with the MoD one of them. The report showed that the MoD is reporting on independent income to the minister on a daily basis [1]. All available data and indications suggest that the institutional scrutiny of the MoD budget income is satisfactory.

There are no published reports on audits performed by the Internal Audit Unit and no further audits performed by SAI since 2016. All BCSP access to information of public importance requests concerning the MoD’s independent sources of income were met with satisfactory responses. [1] The data is available, but it is not used extensively by the public or media.

The Ministry of Defence (MINDEF) and the Singapore Armed Forces’ (SAF) annual budget is exclusively provided for by the Singapore government. All revenue from defence-related sources and activities is consolidated as government revenue, together with other public revenue such as taxes, and incorporated into the government’s Consolidated Fund, which then finances MINDEF/SAF activities. The Auditor-General’s Office (AGO) audits all sources of revenue. The SAF maintains a separate revenue source called the SAF Central Welfare Fund (CWF), a fund for welfare services for its personnel, including scholarships and bursaries for members and their children, financial aid, recreational activities, and incentive awards [1]. This is managed by the Welfare Council – including the leadership such as the Chief of Defence Force and the three service chiefs – which submits annual statements to the Armed Forces Council. MINDEF also administers the Savings and Employee Retirement and Premium Fund (SAVER-Premium Fund) the SAVER Fund was established on 1 April 1998 by the SAF (Amendment) Act 1998, when the MINDEF took over the management of the accumulated pension money for SAF officers from the Ministry of Finance and administered it as a separate saving and retirement fund. A comparable scheme for non-commissioned officers called the Premium Plan was introduced in March 2000, and subsequently combined with SAVER to form SAVER-Premium [2]. These are examined annually by MINDEF’s Internal Audit Department as well as an audit by the AGO under the Audit Act (Cap. 17). Although there are several levels of oversight, reports on audits published by typically only focus on problematic areas and do not offer an overview of the CWF [3]. Some income is also generated via disposal and sales of retired military equipment and stores by the Defence Science and Technology Agency (DSTA). However, income generated through this activity is not publicly disclosed [4].

The MINDEF and SAF do not have other sources of income beyond the annual budget allocated by the government [1]. There is a robust framework for audits of defence-related activities that includes several levels of internal and external oversight. Internal audits are performed by the MINDEF Audit Committee (MAC), and the Internal Audit Department (IAD) and audits are conducted by appropriately skilled individuals [2]. IAD’s audit reports and the follow-up actions are reviewed by the MAC chaired by the Permanent Secretary (Defence Development), which meets every two months [3]. All government accounts and budgets, including military spending, are scrutinised by the Parliamentary Public Accounts Committee (PAC). Although internal audit reports are not publicly available, there is ample evidence that corruption and weak oversight has been made public, in certain cases [4, 5]. However, IAD investigations and remedial actions (if any) remain opaque to public scrutiny.

The MINDEF and the SAF do not have other sources of income beyond the annual budget allocated by the government [1, 2]. There is no evidence that there has been consistent scrutiny by civil society organisations (CSOs) or the public on defence income, as this information is not made available beyond the top-line figures found in the annual defence expenditure. However, internal and external scrutiny of such matters appear to have been amply addressed by organisations such as the IAD and MAC (internal) with additional oversight by unaffiliated organisations such as the PAC [3].

The Department of Defence (DoD) Annual Report contains summaries of all receipts in the preceding financial year, but no information is released as to the individual source of each receipt except in instances where its size or purpose is notable such as United Nations peacekeeping reimbursement payments [1]. All incoming receipts, except for receipts against sales of excess defence equipment (which are also reported on and explained in the Report), are surrendered to the National Revenue Fund. Once given to the National Revenue Fund the DoD has no further control of the allocation of the funds, which are distributed amongst departments as part of the regular budget process [2].

The Department of Defence’s accounts are scrutinised by the Office of the Auditor-General [1]. Although there is an internal audit unit within the DoD, the auditor-general’s report states that its performance is ‘unsatisfactory’, having completed only six of the 31 planned internal audits [2].

Public scrutiny of departmental income from other sources is exceedingly rare, and even when it occurs is usually focused more on the nature of the transaction (i.e. why a type of equipment is being declared excess and sold) rather than on the income [1, 2, 3].

The Defence Statistics Annual Report discloses full information on defence income, including land and property rent, income generated by hospital operation, interest and penalties, etc. It is published annually and disclosed publicly. The amount of income for each item is stated in the government publication. [1]

The Ministry of National Defence (MND) and relevant bodies are regularly audited for revenue and expenditure by the BAI, [1] and some results become available publicly through media reports. [2] The MND has an Inspection Bureau, an internal audit office. [3]

The media and CSOs occasionally report and scrutinise defence income. Media coverage from November 2018 includes information on defence income gained from property disposal. According to the article, MND gained income by disposing of facilities which were not currently used. [1] Although the media has reported audit results for the spending of the defence budget if the reports made publicly, [2] [3] it is difficult to say that the media has been actively involved in scrutinising the non-central government defence income.

The opaque nature of the government means that there is hardly any information about non-central government sources of funding. But recently, The Sentry, an investigative NGO in the USA, unearthed the involvement of the Defence Ministry in the mining sector in South Sudan. [1] Companies owned by the Ministry are registered in the names of individual generals, raising questions about whether income earned from mining by the Ministry is reported to oversight authorities. Accordingly, the investigation suggests that the dearth of information in the mining sector and the involvement of the Ministry in mining “illustrates the inadequacy of existing transparency measures.” [1]

Any internal audits of off-budget income at the Defence Ministry should be reflected in the annual national audit of government accounts by the Auditor General. But the last audit was released more than ten years ago and only for the accounts of pre-independent South Sudan. To date, no audits of South Sudan after independence in 2011 are publicly available to enable an understanding of the Ministry’s internal audits. [1] Additionally, although the Security Committee of the National Legislative Assembly has a mandate to review budgets, it does not monitor off-budget funding. [2]

The public, civil society, and media have a very superficial understanding of defence issues in general. [1] Issues such as public scrutiny are unheard of for a variety of reasons, ranging from fear of prosecution (defence issues are generally considered national security issues) and lack of free expression. [2]

The main sources of defence income, other than from the general budget, are managed by the Institute of Defence Housing, Infrastructure and Equipment (INVIED) as is stated in Article 8 of Royal Decree 1080/2017. Every year INVIED publishes a complete report of its activities with information on defence properties, alineations, and the allocation of this income [1, 2, 3, 4, 5].

INVIED, which depends on the Ministry of Defence, is overseen by the supreme audit institution. INVIED states in its annual reports that it reports and answers to parliamentarians’ questions from the Spanish Senate, Congress and Ombudsman [1, 2, 3, 4].

There is no in-depth public scrutiny from the media about the Ministry of Defence’s income, because they offer superficial information without critical analysis on this matter [1, 2, 3]. It is the same with CSOs, except for the Centre Delas for Peace Studies [4], but it does not seem to be from a lack of access to this information, rather because of limited interest in the subject.

A review of the websites of the Ministries of Defence, Interior and Finance [1,2,3] yields no information about non-central government sources of defence sector funding. Civil society organisations and the media are the main avenues through which equipment sales, property disposal and other foreign transfers and domestic payments to security forces are tracked and made publicly available (to the extent that such research and investigations yield credible information and the resulting information is not withheld for fear of reprisal).

Mechanisms that would, in theory, scrutinise non-central government sources of defence funding either do not have access to information about such funding or, for reasons of fear or politics, do not prioritise scrutiny of such funding. In a phone interview, a well-published expert on Sudan’s defence sector said that even the Minister of Defence is not given the information to review and scrutinise most transactions made by the sector’s military components, including sales of weapons and non-defence commodities, mercenary services, criminal activities, community protection services, etc. [1]. Perhaps the most obvious reason why national institutions do not scrutinise non-central government sources of funding in the security sector is that the head of the Sovereignty Council and his deputy are both military leaders; specifically, the deputy head of the Sovereignty Council is also the Commander of the RSF forces – which, as Ruth Michaelson of The Guardian writes, are the primary beneficiaries of security cooperation deals and gold sector dominance and which notoriously grew out of the brutal Janjaweed forces [2] (which former President Bashir paid to viciously quash the rebellion in Darfur).

Some CSOs and media aim to gather and publish information that scrutinises non-central government sources of defence funding and how that funding is obtained and used. However, in-depth research and publication of such information, conducted in a credible and verifiable manner, is rare. Most public criticism of non-central government resources transferred to the defence sector does not offer any well-documented evidence – often because such evidence is closely guarded by the parties involved and/or because the implicated defence sector actors intimidate the would-be publishers of such information. For example, the BBC published an article alleging that, by the time of Bashir’s ouster, the head of the RSF had become the richest man, heading the richest armed element, in Sudan due to his organisation of gold processing and exports to the UAE, as well as the sale of mercenary services to the UAE and Saudi Arabia [1]. The revenue that the RSF and possibly others in the government of Sudan gained through these arrangements is not known. In a phone interview, an expert on Sudan’s defence sector said that in Sudan, most social media ‘scrutiny’ of illicit sources of funding to armed elements is superficial and doesn’t dig deep [2].

In the FMV annual reports [1] [2] [3], there is full publication of the amounts of royalties and related forms of income. However, information on sources and allocation of royalty income is sparse and presented in aggregated form at best. A ‘loophole’ noted in the 2015 iteration of the GDI still exists by which Swedish Defence Materiel Administration Agency (FMV) may receive and freely dispose of up to SEK 20 million in royalties per individual contract without having to register them. Only for contracts above SEK 20 million must FMV report the income to the government [4].

Mechanisms of scrutiny are in place and administered by the National Audit Office who review all budgets and annual reports in the defence sector [1]. However, their scrutiny remains limited since the current reporting system (Q15A) ensures that very little information regarding royalty incomes is released [2].

There has been some scrutiny by the media, political opposition, and CSOs in previous years of FMV’s transparency issues with regards to royalties (Q15A) [1] [2]. Suprisingly however, beyond these reports little to no substantial or in-depth debate seems to have taken place.

Income has to be channelled back into the general federal budget according to the law [1]. A motion in parliament in 2012 suggested to change that for the Federal Department of Defence, Civil Protection and Sport (DDPS) and was clearly rejected in the national council [2]. The incomes are published online and explained in some detail in the yearly State Financial Statement [3]. However, the numbers provided online are not disaggregated. A recent report of the Internal Audit of the DDPS suggested more transparent rules and better guidelines for sponsoring and income from sponsors and this has aready been implemented. [4, 5].

The law prescribes an economic and efficient use of finances (Article 12.4 FHG) [1]. There is the Swiss Federal Audit Office (SFAO) that audits and publishes reports on specific aspects of the processes within the DDPS [2]. The DDPS also has an independent internal audit department that publishes its reports since 2015 [3]. The SPC, as well as a sub-committee of the Control Committee of the Federal Assembly, have oversight functions when it comes to the DDPS [4].

Although the information is available on the income of the DDPS, a search for media reports scrutinizing that income has not yielded any results. This might be simply due to the relatively small and little controversial income of the DDPS. Considering that there are NGOs dedicated to critically looking at the activities of the DDPS and the Swiss Armed Forces, it is reasonable to conclude that irregularities would be discovered and pointed out by CSOs [1].

Incomes are required to be disclosed in the annual defence budgets compiled by the Ministry of National Defence (MND) [1, 2]. Income sections can be found in the annual defence budgets for 2016, 2017, 2018, and 2019 [1, 2, 3, 4, 5]. Taiwan’s MND receives no income from sources other than the government appropriation.

The income sections of the annual defence budgets and approvals are made public on the internet; however, the secrecy defence budgets and approvals are not available [1]. Both the open and secret defence budgets and approvals are subject to institutional scrutiny by the Directorate General of Budget, Accounting and Statistics (DGBAS) of Executive Yuan, the Budget Centre of LY, and the National Audit Office of CY [2].

These income sections of the annual defence budgets are approvals are accessible on the internet and are subject to considerable and consistent scrutiny by the public, including by the media and by CSOs [1]. Stakeholders from academia, thinktanks, or foreign institutions (e.g. the American chamber of commerce in Taipei) are all able to access this public data [2].

There are a number of businesses within the military, the most high profile of which is SUMA-JKT, though none of their incomes are stated in budget documents. Budget books only indicate estimated expenditure for the Ministry of Defence, under which SUMA-JKT and other entities fall. [1] The annual budget speech only indicates estimated aggregrate income, and gives no report on actual income for the previous year. [2] The SUMA-JKT website gives no information on detailed activites, or accounts. [3]

According to a senior military officer, there are internal audit units in every sector of the military which are independent and flexible enough to build their own programme of work. These units comprise staff who are experts in the field of auditing and are military personnel. The audit reports from the sectorial unit are presented quarterly to the Chief Inspector General (CIG) and Comptroller General who are military personnel in the military headquarters office. From there, the compiled report is presented to the Commander of Defence Force for further actions. [1]

Oversight of the internal audit report of the defence force is enabled. The internal audit report is subjected to further scrutiny by the Comptroller and Auditor General (CAG) who audits the report and prepares the main audit report of the whole government annually. This report is submitted to the parliament for the purpose of analysis and detailed discussion by the Members of Parliament. After the discussion, parliament gives an opinion and recommendation to strengthen government service delivery and maintain integrity within the government. For example, the annual audit report for the financial year 2018/2019, schedule 58, page 173, shows audited central government institutions, particularly in defence, which procured different services without having contracts. [2]

There is almost no public scrutiny of defence income from any souces. Legislation such as the National Security Act 1970, which covers access to information management, discourages anybody in the sector from sharing information. [1] The Access to Information Act 2016, restricts access to information related to the military. [2] Consequently, even oversight by the National Audit Office is limted. For example, there are only 5 mentions of the Tanzania People’s Defence Force in the National Audit Office’s report on Central Government expenditure for 2019-20. [3]

In February 2020, after the mass shooting incident in Korat, General Apirat Kongsompong admitted that the military has long been stained by alleged irregularities in issues relating to military-owned businesses, ranging from welfare housing to loans, sporting facilities, boxing stadiums, golf courses and resorts. Thanathorn Juangroongruangkit from the Future Forward Party described the income from these businesses as ‘off-budget funds’ that might not return to state revenue, making much of this business exempt from close scrutiny [1]. According to Mr Thanathorn, the ministry’s regulations allow it to manage its funds under its own set of regulations. Mr Thanathorn said that, even as a former MP, he could not see where the off-budget funds were allocated and how they were spent, so it was impossible for the general public to examine this sum [2].

Again, even though the Fiscal Responsibility Act was enforced in order to monitor, evaluate and report off-budget borrowing and thereby strengthen fiscal discipline, key issues such as transparency remain beyond the scope of the Act [1]. This is because the Ministry of Defence’s regulations allow it to manage its funds under its own set of regulations, making it impossible to examine where the off-budget funds are allocated and how they are spent.

Nonetheless, after the Korat mass shooting massacre, General Apirat Kongsompong announced that he would restore transparency and accountability to the barracks by promising to quickly examine a range of army projects and current practices in army-operated businesses that have attracted criticism in the past. This included more than 30 golf courses, 126 radio stations around the country and a TV station (Channel 5), which have been generating ‘off-budget funds’ exempt from close scrutiny. The General also announced that a memorandum of understanding (MoU) would be signed with the Ministry of Finance to ensure better management of the army’s commercial and welfare schemes in the future [2]. Since Thailand’s Army and the Treasury Department signed an MoU, the Army’s 40 commercial welfare schemes, which include golf and race courses, land, buildings and recreational venues, are required to be professionally managed by the private sector, with benefits shared between the Army, the Treasury and the private sector. According to the department’s latest survey, the Army controls 160,000 hectares of land nationally, about 120,000 hectares of which are illegally occupied by private individuals [3]. Nonetheless, the MoU had been recently signed (less than a month before on the day this indicator was scored); therefore, the effectiveness of the MOU is still questionable.

The Thai military is essentially unaccountable to civilian authority, as it has its own courts and an increasing budget that remains largely beyond public scrutiny [1]. However, the Korat shooting rampage in 2020 marked a significant change, forcing a thorough investigation from the outside, into the military’s internal problems and shady businesses, which have come under zero scrutiny, for the sake of transparency and accountability. As a result, General Apirat promised more transparency in the army regarding public land assets, golf clubs, boxing stadiums and hotel deals, whose income is set to be channelled to the army welfare fund. However, it is believed that these strict policies, which have not yet come into effect, will not apply to high-ranking officers or extra income generated outside of the national fiscal budget, such as profit from army media [2].

According to our sources, the non-central Government funds are registered and shown in the budget. However, this data is not published in detailed formats(1,2,3). Sources of income other than from the central Government allocation are published in the Ministry of Defence’s budget (4). These incomes are coming from the national service fund (funded by the contributions of conscripts and amounts paid by the structures for which services are rendered). The total amount of income is published (1, page 20). Equally, for the expenditure of this fund, only total amounts are published. It is explained in the budget’s document that these funds are allocated to the development of rural or remote areas and that its total resources are used to cover the expenditures necessary for the completion of projects.

According to chapters 3 and 4 of Law n°42- 2004 dated the 13/05/2004 “organic budget law”, these sources of income are subject to the sale rules of audit and control applied by the Government. There is no exceptions for the defence budget (1). There is no further information on the nature of this scrutiny.

According to our sources, there is no public interest in the non-central Government income to MoD, and therefore no scrutiny or public oversight(1,2,3). It is to be said that the amount of income coming from this is relatively low (10 million dinars). The review of media reports didn’t show any interest from CSOs and media in the scrutiny of this source of income (4).

The sources of defence income other than the budget allocated by the central government are listed below:

* Defense Industry Support Fund (Savunma Sanayi Destek Fonu) is a fund provided to the SSB to execute its mission and finance its procurements. It is a very special fund with less bureaucratic formality, comprised partly of levies and partly of lottery prizes [1]. In Turkey, the greatest lack of transparency occurs in tracking defence-related expenditure, some of which is reflected under the budget headings of other state sectors and departments. Since the establishment of the Defense Industry Support Fund (SSDF), the law permits extra-budgetary financing of arms under this fund. Between the years 1997 and 2000, 86% of defence expenditure was reflected in the defence budget. The SSDF covered the rest, which was non-budgetary.

* Turkish Armed Forces Foundation (TSKGV) Resources
On December 24, 2016, the government issued Decree No. 696, which places the Presidency of Defence Industries (SSB), the Prime Ministry’s key institution, in charge of the State’s defence procurement as the subordinate of the MoD. This institution was allocated nearly USD 11 billion in the 2018 general budget, under the presidency’s full control. This decree, which gives the presidential office full control of the SSB, with the power to procure, produce and sign deals for all military and police forces of the country, and allows the President to chair the Defence Industry Executive Committee, Turkey’s top decision-making committee for procurement (see Article 2) [2], marks a further weakening of the Prime Ministry’s agency in Turkey’s defence/security sector. The committee meets at the invitation of the President, who also determines the meeting agendas. The SSB provides the committee’s secretariat services.

The committee decides the strategic goals of Turkey’s security-sector actors, primarily the military and the Gendarmerie General Command, and selects companies to work on procurement for the sector. The committee is also authorised to finance scholarships and training to develop human resources for the defence industry. With this major decree, the President controls the Turkish Armed Forces Foundation, which earns 43% of the Turkish defence industry’s total revenue while undertaking 41% of defence exports. As a result, the President also controls the foundation’s extensive holdings, including 85% of the equity of Aselsan, the electronics giant of the Turkish defence industry, which ranked no. 67 in the Stockholm International Peace Research Institute’s 2016 list of the top 100 arms-producing and military services companies (the Turkish government’s Andalou Agency also just announced that Aselsan has signed a USD 92.5 million contract with Turkish defence and commercial vehicle maker BMC Otomotiv).

The Turkish Armed Forces Foundation also owns 54.5% of Turkish Aerospace Industries Inc. (TAI), a pioneering Turkish defence firm in the field of aerospace and satellites, while the SSM owns another 45.5%. TAI ranked no. 76 on the Stockholm International Peace Research Institute’s list. Other major holdings include 55% of Roketsan, the only designer and manufacturer of rocket systems in Turkey; 99% of Havelsan, Turkey’s top software, informatics and systems integration firm; 55% of Tusas, Turkey’s pioneering firm in aerospace technologies; 99% of Isbir, which provides power generators and alternators for important defence and public projects; and 97% of Aspilsan, a manufacturer of original equipment, battery and battery pack products for major defence industry systems.

With this new legislation, the President also serves as the chairman of the Defense Industry Support Fund, replacing the Minister of Defence as the final authority over the SSM and the Turkish Armed Forces Foundation. The foundation, with its slickly produced promotions, is mostly managed by retired generals and receives major donations in the form of money, businesses and real estate from all segments of society. The decree also designates USD 15 million in starting capital to the Military Factories and Shipyards Management Corp. (ASFAT) to regulate about 30 military factories attached to the Ministry of Defence. The ASFAT is authorised to take orders from national public institutions and foreign customers and can hire foreign personnel.

* Mechanical and Chemical Industry Corporation (MKEK)
MKEK is a defence industry company owned by the Ministry of Defence, which produces equipment for the Turkish Armed Forces, such as ammunition for small arms and heavy weapons, artillery systems, aerial bombs, mines, explosives and rockets. MKEK also manufactures civil-purpose products such as steel, brass and electrical parts and equipment. Its large range of defence industry products is not only in demand in Turkey, but is also exported to more than 40 countries worldwide with an annual turnover of around USD 200 million.

* Gendarmerie General Command Budget (Ministry of Internal Affairs)

* Coast Guard Command Budget (Ministry of Internal Affairs)
With the issuance of Presidential Decree 668 in late July 2016, the General Command of the Gendarmerie and the Coast Guard Command were fully attached to the Ministry of the Interior. Therefore, their budgets moved from the ‘Defence Services’ item to the ‘Public Order and Safety Services’ item. Unlike their counterparts in EU member states, these two command forces continue to play a military role in Turkey [3]. Therefore, although spending towards the needs of the Gendarmerie and Coast Guard clearly belongs in the category of military spending, their budgetary resources are not recognised as military spending in the national budget, which superficially reduces the total amount of military spending in Turkey. Adding the spending for the Gendarmerie and Coast Guard to the Ministry of Defence spending would give a more accurate picture of military spending in Turkey.

* Turkish Military’s Trust and Pension Fund (OYAK)
The OYAK is Turkey’s largest pension fund, also serving as a credit aid fund, which all officers and non-commissioned officers (NCOs) of the Turkish military are obliged to join. About 10% of the monthly salaries of 250,000 OYAK members is automatically deducted as contributions to the fund, generating a monthly cash flow of around USD 35 million. This has made the OYAK one of the biggest domestic investor holdings in Turkey, which has been in the grip of major economic problems since 2019.

* The profit shares of military markets/canteen run in military facilities and housing sites
* The proceeds of the Ministry of National Defence based on Special Laws
* Income from the Presidential covert fund

Overall, as shown above, the central defence/security budget in Turkey is complex, complicated, hard to manage and multi-faceted, and is run with the involvement of more than 20 different actors, government agencies, State-owned firms, foundations, directorates and covert funds, without being subject to oversight by legislative mechanisms or transparently monitored by civil society actors. This multi-faceted and multi-actor nature of the central defence budget makes it harder to scrutinise in executive terms.

* Law 3238 regulating the Defense Industry Support Fund and SSB activities does not contain a single article about oversight/monitoring mechanisms or about the fight against corruption and anti-bribery. It should also be noted that the Defense Industry Support Fund or SSB is not audited externally by the Court of Accounts (CoA) or parliament. Both are soley under the control of executive mechanisms such as the Presidential State Supervisory Board or their own auditing departments.

* It should be noted that the TSKGV Foundation Law, which was amended in late 2018 in order to meet the needs of the presidential system, does not contain any articles about how to achieve transparency or how to form oversight and monitoring mechanisms for the fund’s income and operations.

* OYAK has been operating companies in Turkey under the control of fiscal regulations, but there are many opaque areas around the executive board’s decisions, investments and spending policies and, more importantly, balance sheets.

According to Interviewees 3 and 4, the economic activities of those Turkish military-owned and affiliated defence industry firms and the OYAK have always been opaque and kept away from public scrutiny [1,2].

Overall, there is no CSO or NGO in Turkey that regularly monitors the means of defence income other than central government allocation. Since summer 2018, we have not been able to find any articles, reports, or reliable open-source content on online sources explaining the financial activities of the funds or companies in the chain of defence income other than central government allocation. Thus, one could suggest that there is almost no media or academic interest in these bodies that may lead to public scrutiny. As emphasised earlier, due to supression by Erdogan’s super presidency, media outlets and CSOs have been in a ‘self-censorship’ mode, meaning they diligently filter and self-censor their content in order to avoid being harrassed economically and politically by the government.

According to the Report of the Auditor General on the Financial Statements of the Ministry of Defence and Veteran Affairs for the year ended 30th June 2017, the Ministry of Defence and Veteran Affairs (MoDVA) had some undisclosed non-tax revenue (NTR). Included in the Statement of Financial Performance was NTR collected by the MoDVA amounting to UGX.1, 421,780,000. According to the report, a detailed analysis of this amount indicated that the MoDVA collected rent from NIRA of UGX.952, 000,000, MTN Marts UGX.162, 000,000 and from the hire of Kololo Independence grounds and sale of bid documents UGX.258, 820,000. However, the auditor general reported that there was no Memorandum of Understanding between Airtel and MoDVA to confirm the amounts due from Airtel. He further observed that there was a risk of understating NTR collected and disclosed in the financial statements. Also, Airtel had not signed a memorandum of understanding with the MoDVA despite several reminders [2].

In each government ministry in Uganda, there are internal audit departments. It is from these different reports which are generated by the internal audit department which are then given to the external bodies for scrutiny. The Office of the Auditor General[1], the commitees on defence and internal affairs, and public accounts[2] and internal affairs under takes audit of alll sources of defence income.These external bodies will then submit their findings to the relevant committees in Parliament which are then subjected to debates and appropriate recommendations are made based on the findings in these reports.

Public scrutiny of non-central government sources of funding is minimal or non-existent because of the nature of the sector. Most of the activities are deemed classified and confidential [1, 2].

The annual laws on the State Budget of Ukraine contain information on all budget revenues by type of revenue, amounts received, and include all of MOD’s budgets [1]. For instance, the revenue which “Proceeds from the lease payment for the use of an integral property complex and other state property” and “Funds from the sale of surplus weapons, military and special equipment, immovable military property of the Armed Forces of Ukraine and other military formations formed under the laws of Ukraine, law enforcement agencies and other state bodies” also include the MoD revenues, but the annual laws on the State Budget do not provide information on specific MoD revenues [1]. Moreover, the MoD started publishing its budget requests since 2016 including information on revenues from the alienation of land plots [2], information on revenues in form of fees for property lease, revenues from sales of property (except for real estate), etc. [3]. The annual budget indicates the allocation of some of the incomes. For example, 50% of the revenues from the sale of surplus assets are to be directed to the general fund of the State Budget of Ukraine, the other 50% – to the special fund of the State Budget of Ukraine to finance the construction (purchase) of housing for servicemen of the Armed Forces of Ukraine [4, 5]. The MoD also publishes information on the provided charitable assistance [6] and sometimes publishes information on the amounts received from the surplus assets disposals [5], although there is no evidence for such publications being done regularly. However, the MoD’s budget requests indicate the allocation of incomes in a much more disaggregated manner.

The State Audit Service conducts the external financial control [1] as well as the Accounting Chamber, which also conducts the financial control of classified spendings on behalf of the VRU [2]. Both authorities scrutinize the MoD [3, 4]. There is also an internal MoD unit, the Internal Audit Department, that audits the financial and material resources of the MoD to prevent their illegal and ineffective use [5, 6]. Ukrainian legislation does not stipulate that audits are to be published. However, the MoD’s Internal Audit Department provides those non-redacted audit reports upon requests [7].

Generally, information about public scrutiny of defence income is absent in the open sources in Ukraine. There is some evidence of public scrutiny of non-central government sources of funding, but the data does not seem to be considerable or consistent [1].

There is no publication of non-central government sources of funding and income. According to our sources, the only income and source of funding comes directly from the central government of the UAE, and it is managed indirectly and directly through the office of the crown prince MBZ (1), (2), (3).

As there are no non-central government sources of funds, there is not any kind of institutional scrutiny over defence income generated through non-central government sources (1), (2), (3).

As there are no non-central government sources of funds, there is not any kind of institutional scrutiny over defence income generated through non-central government sources (1), (2), (3).

The MoD publishes all sources of income, the amounts received, and the allocation of this income in its Annual Report and Accounts [1]. External income earned by the MoD is also published in the finance and economics annual statistical bulletin [2]. The biggest source of such income is listed as “NATO/UN/US/Foreign Governments”, followed by “Personnel” and “Supplies and Services” [2].

Mechanisms of scrutiny of MoD income, including non-central government sources of funding, are in place and administered by the National Audit Office [1]. The MoD Annual Report and Accounts contains a Parliamentary Accountability and Audit Report, which ‘describes how the MoD have been financed through the Westminster Estimates process, and includes a number of other ‘accountability’ disclosures which are required by Parliament’ [2]. However, there is insufficient evidence regarding an effective internal audit office within the MOD, as the unit does not publicly release its findings.

While there has been public scrutiny regarding ‘funding black holes’ in MoDs plan to equip the Army, public scrutiny of non-central government sources of funding does not appear to be in-depth or consistent [1].

Appropriated funds can include funds, e.g. general funds, working capital funds (WCF), trust funds and special funds [1]. Additionally, the DoD can use non-appropriated funds, which are overseen by advisory groups. This non-appropriated fund activity is not included in the DoD Financial Statements [1]. Revenue generated from the sale of goods and services has to go directly to the Treasury [2]. There does not appear to be a single coherent and comprehensive publication of all sources of income. Volume 11A, Chapter 5 of the DoD Financial Management Regulations outlines how income associated with the disposal and sale of ‘personal property’, a term used to cover equipment to be demilitarised, scrap material, food reserves, security assistance property and data processing equipment, amongst other things, should be allocated [3]. As this is a regulation, it does not indicate whether this happens in reality or not. Some of these items would be very minor budgetary lines so it does not seem likely that they would be published, however, this is yet to be confirmed. Finally, Nonappropriated Fund Instrumentalities (NAFIs) are used for entities that are established by the DoD and controlled by the military departments, but in which the DoD does not have ownership interests. NAFIs are primarily used to enhance the quality of life of DoD personnel and retired military service members [1].

Non-central sources of income appear to be a minor occurrence, and very little information could be found regarding either the funds themselves or oversight. Given that the DoD is now audited by an external auditing body, it would seem that these sources would be scrutinised there [1]. However, as there is no publicly available information, this indicator is marked ‘Not Enough Information’.

Sources of income from funds or personal property sales do not receive much public interest as they appear to be quite minor relative to the size of the defence budget.

Given that budgets for the years since 2016 are unknown, and that no legal and public accountability process have taken place for any public sector [1, 2, 3], there is no information on income from other funds.

Two factors reflect the lack of transparency in the area of defence sector revenues, as well as aggravating the situation. Firstly, there are around 20 private military companies that generate unknown amounts of income [4, 5]. Secondly, defence is one of the sectors which has been allocated the most additional credits each year of Maduro’s government; there is no information confirming the origin of the income that finances these additional credits [6].

In recent years, the Ministry of the People’s Power for Defence (MPPD) has not been accountable to the National Assembly (AN); which has prevented the legislative branch from scrutinising defence sector revenues from the National Treasury and other funds [1, 2, 3]. An internal auditing body for the MPPD is headed by the Office of the Comptroller General of the National Bolivarian Armed Forces (CONGEFANB); however, there is no evidence that this comptroller audits income related to the output of military companies, disposals, and allocations from different sources [4].

According to the Organic Law on Financial Regulation, budget acts submitted to the AN for approval must contain details of income [5]. In cases where the AN authorises additional appropriations during implementation, allocations from funds other than the National Treasury must be approved in advance by the legislature. At present, none of these provisions are complied with, since the judiciary has voided the functions of the AN and the executive implements budgets and additional appropriations that are not controlled by the legislature. The Offices of the Comptrollers General that have authority over the defence sector have shown no indication of taking action on the sector’s income and expenditure [2].

Some civil society organisations maintain an active role in monitoring and seeking to audit defence sector income; however, these organisations have been blocked and are not allowed access to official information on the administration of the sector. As such, scrutiny is limited [1, 2].

Reports from civil society organisations have condemned the lack of information on the management of and income generated by companies affiliated with the MPPD [3, 4]. They have also denounced the lack of information on the origin of and the unconstitutional nature of additional credits that have been approved for this and other public sectors [5].

The military in Zimbabwe is known to be involved in several profit ventures, including interests in mining, among other sources of funds, yet the proceeds generated from these activities are unknown. In any case, where the State intends to venture into a profitable endeavour, the practice is to establish a parastatal established and administered in terms of an Act of Parliament, in respect of companies owned by the Zimbabwe Defence Forces, especially in recent times no such parastatal has been established to be managed by the military or the intelligence services [1]. According to a former finance minister, the military owns Private Limited Companies with no link or obligation to remit proceeds to the consolidated revenue fund. In this respect, funds are not declared, even when the military auctions off equipment excess to requirements in terms of things like vehicles, no such record of publication of proceeds is made [1, 2].

The Ministry of Defence has a centralised audit unit that is meant to deal with the scrutiny of all the books of the security services, primarily the Zimbabwe National Army and the Air Force of Zimbabwe [1]. The Central Intelligence Organisation is part of the broad President’s Office, the auditing unit in the Ministry of Defence does not have jurisdiction. The auditor general has the powers to scrutinise the books extending to all sources of funds, including donations. However, the auditor general, in the 2017 report, highlighted that the military in Zimbabwe did not record donations in respect to vehicles, and that the military has not been providing supporting documents for expenditures. Despite evidence that the military has interests and other sources of funds outside government, there is no proof that the auditor general has unfettered access to scrutinise the military; neither does the audit unit in the Ministry of Defence [2, 3].

The public, the media and l society organisations have no access to information pertaining to non-centralised sources of funds, including the disposal of property (including vehicles). What can be established is that there are indeed sales of old vehicles done through third parties [1]. With no information on the non-centralised funds published, it is almost impossible for public scrutiny to take place. There is also proof that the army is involved in for-profit ventures [2, 3].