Netherlands Court of Audit Says NATO's Bookkeeping Stinks
June 13, 2014 • 11:16AM

In a surprising initiative, the Netherlands Court of Audit (NCA) declared on June 10 that NATO's financial management stinks. For six years, the NCA has called on NATO for more transparency, but without result. The news reached the front pages of the Belgian press where NATO is headquartered. The Flemish daily De Morgen titled "NATO money; nobody knows what it is used for."

The NCA audits, among other things, the expenses that the Netherlands annually spends on NATO activities. While the NCA has no specific mandate to audit NATO, they are involved in advising the International Board of Auditors for NATO (IBAN). NCA's website says that, "Together with IBAN and other Supreme Audit Institutions of member countries we have been concluding for several years that NATO's financial management is not in order."

Three flows of money are tapped from the total amount of about $1 trillion spent by 28 NATO members on defense. The first flow of money goes to missions, such as Afghanistan; the second flow goes to specific projects, such as the buying of the NH-90 helicopter and the Eurofighter. About these two flows of money, "we don't know anything," the court's president, Saskia Stuivelong, was quoted as saying in De Morgen. The only spending identified is the "organizational" costs, which amounts to $2.4 billion. On NATO's English-language site, things are cited as "undisclosed," she complained. However, she argued, we don't know why they are "undisclosed," because the arguments justifying their "undisclosure" are also undisclosed... NATO's attitude is always to keep things secret. NCA discovered that between 1970 and 1994, NATO started 378 projects that are unsettled in the bookkeeping.

In order to pressure NATO to become more transparent, without compromising the security of its activities, the NCA has taken the initiative to present on its own website an overview of the publicly available information on NATO's finances and its results, and what is publicly known of financial flows from the member countries to NATO.