The Minister of Defense commented on the media material about the purchase of products for the Armed Forces of Ukraine

The Minister of Defense of Ukraine Oleksiy Reznikov commented on the information spread by journalists about the purchase of products for the Armed Forces at allegedly inflated prices.

He informed that he will present comprehensive information with all documents to the MPs at a meeting of the specialized committee with the participation of representatives of NABU, SBI and SBU.

"Just a year ago, this market was actually under the control of a monopoly. During my appointment as a minister, I made a public commitment to demonopolize food services. And my team and I did it last winter. Although the resistance was terrible, and the monopolist threatened to completely block the supply of food to the army. It didnʼt work," the minister noted.

According to Reznikov, overcoming the monopoly made it possible to successfully organize the feeding of the army, the number of which increased several times, despite all the difficulties of the active phase of the war.

The Ministry of Defense currently has contracts with eight food service providers. According to the contract, a certain number of military units is assigned to each of the suppliers. The contracts stipulate a norm: if one of the suppliers is unable to fulfill its obligations, the others "pick up" the military units according to a specified algorithm.

The Ministry of Defense does not purchase individual products, but buys a comprehensive service — food provision.

Last year, the cost of food for one soldier was 120 hryvnias per day, and this year the ministry received an offer ranging from 151 to 162 hryvnias per day. According to the results of the negotiations, the price was 145.8 hryvnias.

"The peculiarity of the contracts of the Ministry of Defense is that they are concluded with service providers for a year in advance at a fixed price. That is, these are also risks that business takes on," the Minister of Defense noted.

Reznikov also explained that the process of concluding contracts and making commitments consists of several stages. Announcing the needs of the Ministry of Defense, providing business proposals, conducting an external price review, negotiating a contract, conducting an internal audit, signing a contract, etc. The final part of this process is the registration of the signed contract in the State Treasury. Only after registration with the Treasury do financial obligations arise, and then payments are made.

The Minister explained that the prices of the eight suppliers are different, as well as different prices in supermarket chains, because each has its own specialization and own production of a certain group of goods.

Product prices are analyzed by special expert institutions.

"There is a huge amount of distorted information about prices in the media now. The "Mirror of the Week" edition itself, a day and a half after its publication, cut several items from its infographic containing incorrect comparisons, which have already caused the greatest publicity. Unfortunately, it did so without explanation. Understanding of incorrectness in other positions will also come. After all, incomparable things are compared. Prices for a jar or bottle of packaged products with a price per kilogram. Prices for a liter with price for a kilogram, for net weight with price for gross weight, etc. Even analyzing the figures published in the "Dzerkalo Tyzhnya" ["Mirror of the Week"], many noted that the prices of a significant number of products are lower than in the neighboring store. Despite all the business risks," he noted.

What the "Mirror of the Week" publication calculated as 0.2% of the contract value is the food preparation by the supplier in several military units where, for various reasons, outside contractors cook. This is not a product delivery.

"This is another gross mistake that misleads," the minister believes.

Regarding egg prices, the minister said that the document published in the media indicated an abnormal price, which was perceived as UAH 17 per piece.

"What is the basis of the conspiracy theory? In fact, this is a common technical error made by the supplier. Eggs are the only category from the catalog that is calculated in pieces in the annex to the agreement. The supplier indicated the price not for pieces, but for the weight of the eggs, when he transferred the data from one table, where everything was reduced to the unit of measurement by weight, to another table," he assured.

According to the standards, a kilogram of eggs is about two dozen pieces, depending on the variety (the weight of an egg according to the standard should be from 42 g to 60 g). The price of UAH 170 per kilogram of eggs is UAH 85 per dozen. Which is within the parameters of other suppliers and fully corresponds to the market price. He added that the ministry does not buy eggs at UAH 17 per piece.

The Minister emphasized that, as of now, additional internal checks are being completed on all contracts, military units are checking the catalog, correcting technical errors, preparing additional supply agreements within the proven parameters of the state budget, etc. After that, the documents will be registered in the State Treasury.

"That is, the de jure document published in the mass media does not yet exist. Not a penny was spent on it. Statements that the Ministry of Defense "stole" or "tried to steal" billions are complete delusions, the minister said.

Reznikov noted that "the public release of information about prices that were apparently inflated by 2-3 times began already in the middle of last week. That is, not after, but before "Ramstein", precisely when the clarification of agreements continued."

"The person who handed over one of the contracts and the annexes for publication has at least committed an official crime. This person will definitely be identified and brought to justice. For this purpose, relevant materials have been prepared in the SBU. In particular, the motives will be clarified. Since there is no actual component in the claims, except for manipulation, the most obvious goal seems to be an attempt to undermine trust in the Ministry of Defense at a very important moment. And this is not just an official crime," he added.

Reznikov will suggest that peopleʼs deputies consider the possibility of creating a temporary investigative commission regarding the procurement process, if they consider other instruments of parliamentary control to be insufficient.

• Journalists accused the Ministry of Defense of purchasing food products at several times inflated prices. The article stated that the prices of products are three times higher than the retail prices in Kyiv supermarkets. The agreement worth 13.16 billion hryvnias was concluded on December 23, 2022. It is about providing food to military units stationed in Poltava, Sumy, Kyiv, Zhytomyr, Chernihiv and Cherkasy regions.