Nuclear Nonproliferation:

Concerns With DOE's Efforts to Reduce the Risks Posed by Russia's Unemployed Weapons Scientists

RCED-99-54: Published: Feb 19, 1999. Publicly Released: Feb 19, 1999.

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Pursuant to a congressional request, GAO reviewed the Department of Energy's (DOE) efforts to create jobs for displaced former Soviet Union scientists through its Initiatives for Proliferation Prevention program, focusing on: (1) the costs to implement the program for fiscal years 1994-98, including the amount of funds received by weapons scientists and institutes; (2) the extent to which the program's projects are meeting their nonproliferation and commercialization objectives; and (3) DOE's Nuclear Cities Initiative.

GAO noted that: (1) the cost to implement the Initiatives for Proliferation Prevention program from fiscal year 1994 through June 1998 are as follows: (a) of the $63.5 million spent, $23.7 million, or 37 percent, went to scientific institutes in the Newly Independent States (NIS); (b) the amount of money that reached the scientists at the institutes is unknown because the institutes' overhead charges, taxes, and other fees reduced the amount of money available to pay the scientists; and (c) about 63 percent, or $39.8 million, of the program's funds was spent in the United States, mostly by DOE's national laboratories in implementing and providing oversight of the program; (2) regarding the extent to which the program is meeting its nonproliferation and commercialization goals, GAO found that: (a) the program has been successful in employing weapons scientists through research and development projects, but it has not achieved its broader nonproliferation goal of long-term employment through the commercialization of these projects; (b) program officials do not always know how many scientists are receiving program funding or whether the key scientists and institutes are being targeted; (c) some scientists currently working on Russia's weapons of mass destruction program are receiving program funds; (d) some dual-use projects may have unintentionally provided defense-related information--an outcome that could negatively affect U.S. national security interests; and (e) chemical and biological projects may not be adequately reviewed by U.S. officials prior to approval; and (3) the Nuclear Cities Initiative may cost $600 million over the next 5 years: (a) the initiative is still largely in a conceptual phase, and it is uncertain how jobs will be created in the 10 nuclear cities because of restricted access and the current financial crisis in Russia; and (b) the initiative is likely to be a subsidy program for Russia for many years, given the lack of commercial success in the Initiatives for Proliferation Prevention Program.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: On or about October 31, 1999, DOE will establish direct accounts with Newly Independent States (NIS) scientists that are receiving IPP funds. This action will remove the NIS institute as the recipient of the IPP funds and provide a more direct link between the funds and the intended recipient-the nuclear weapons scientist. Further, DOE is working with the Civilian Research Development Foundation to serve as a "payroll officer" to monitor the disbursements.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should obtain information on how program funds are being spent by the NIS recipients.

    Agency Affected: Department of Energy

  2. Status: Closed - Implemented

    Comments: DOE has requested Circular 175 Authority to begin negotiations with Russia on an agreement that would exempt all Initiatives for Proliferation Prevention (IPP) program funding from Russian taxation. DOE hopes to actually begin negotiating the agreement within the next 6 months and hopes to have an agreement in place in late 2000.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should seek assurances from the Russian government, either through a government-to-government agreement or through other means, that program funds are exempt from Russian taxes.

    Agency Affected: Department of Energy

  3. Status: Closed - Implemented

    Comments: DOE is obtaining updated profiles on the various institutes that the IPP program supports. In a few cases, institutes have been dropped from funding because they did not have a weapons-related background. DOE also plans to require that all contracts with NIS institutes include the names and backgrounds of weapons scientists working on IPP projects.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should require that program officials, to the extent possible, obtain accurate data on the number and background of the scientists participating in program projects and eliminate funding for institutes that did not formerly work on weapons of mass destruction.

    Agency Affected: Department of Energy

  4. Status: Closed - Implemented

    Comments: IPP program guidance is being updated to include a clarification of which scientists are eligible for program funding. While nuclear weapons scientists will include both former and current scientists, no biological or chemical weapons scientists engaged in offensive weapons programs will be eligible for IPP funding.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should clarify program guidance as to whether scientists currently employed in weapons of mass destruction programs are eligible for program funding.

    Agency Affected: Department of Energy

  5. Status: Closed - Implemented

    Comments: The Department of Defense's Defense Technology Security Agency has been added to the review process. Moreover, national laboratory personnel are expected to deemphasize the technical and scientific aspects of proposed projects and focus on the dual-use aspects of the projects.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should require that project reviewers consider all military applications of projects to ensure that useful defense-related information is not unintentionally transferred.

    Agency Affected: Department of Energy

  6. Status: Closed - Implemented

    Comments: See above comments on review process. The two recommendations are closely aligned and DOE's expanded and clarified review process is intended to respond to this recommendation as well.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should strengthen and formalize DOE's process for reviewing proposed chemical and biological projects by: (1) providing complete project information to all reviewing U.S. government agencies and organizations; (2) developing criteria to help frame the evaluation process; and (3) providing feedback to all of the reviewing agencies about the final disposition of the projects.

    Agency Affected: Department of Energy

  7. Status: Closed - Implemented

    Comments: DOE is reviewing all of its Thrust 1 projects and is eliminating some that show no commercial potential. In fiscal year 1999 and fiscal year 2000, the IPP program will not approve any new Thrust 1 projects but will focus only on more promising Thrust 2 projects.

    Recommendation: In addition, given that one of the purposes of the program is to sustain the employment of weapons scientists through projects that can be commercialized, the Secretary of Energy should reevaluate the large number of Thrust 1 projects, particularly those that have been funded for several years, and eliminate those that do not have commercial potential.

    Agency Affected: Department of Energy

  8. Status: Closed - Implemented

    Comments: See the above discussion on DOE's renewed emphasis on commercialization of projects, eliminating questionable Thrust 1 projects, and focusing on more promising Thrust 2 projects.

    Recommendation: In addition, given that one of the purposes of the program is to sustain the employment of weapons scientists through projects that can be commercialized, the Secretary of Energy should develop criteria and timeframes for determining when Thrust 1 projects should be terminated if they do not meet the criteria for graduation to the program's next phase.

    Agency Affected: Department of Energy

  9. Status: Closed - Implemented

    Comments: DOE is finalizing a strategic plan on the Nuclear Cities Initiative and expects that it will be completed in early to mid-2000.

    Recommendation: Because DOE plans to implement the Nuclear Cities Initiative in a relatively short amount of time (5 years) at a cost of about $600 million during uncertain economic times in Russia, GAO believes it is critical that the program's implementation be based on solid thinking and planning that considers the problems experienced under the Initiatives for Proliferation Prevention program. Therefore, the Secretary of Energy should develop a strategic plan for the initiative before large-scale funding begins and include goals, costs, timeframes, performance measures, and expected outcomes, such as the number of jobs to be created for each city.

    Agency Affected: Department of Energy

  10. Status: Closed - Implemented

    Comments: DOE is requiring that 65 percent of all new Initiatives for Proliferation Prevention (IPP) project funds must be obligated or spent in Russia or other Newly Independent States and not more than 35 percent of the project funds can be spent by the national laboratories. DOE believes that this formula (stipulated by FY2000 authorization language, section 3136 of Title 31, Department of Energy National Security Authorization-Dept. of Energy Security Programs) will maximize the amount of IPP funds spent overseas and is consistent with GAO's recommendation.

    Recommendation: To maximize the impact of the Initiatives for Proliferation Prevention program's funding and improve DOE's oversight of the program, the Secretary of Energy should reexamine the role and costs of the national laboratories' involvement with a view toward maximizing the amount of program funds going to the NIS institutes.

    Agency Affected: Department of Energy

  11. Status: Closed - Implemented

    Comments: DOE's FY2000 authorization language (section 3124 of Title 31, Department of Energy National Security Authorization, Dept. of Energy Security Programs), states that funds obligated or expended in fiscal year 2000 must be limited to three nuclear cities in Russia.

    Recommendation: Because DOE plans to implement the Nuclear Cities Initiative in a relatively short amount of time (5 years) at a cost of about $600 million during uncertain economic times in Russia, GAO believes it is critical that the program's implementation be based on solid thinking and planning that considers the problems experienced under the Initiatives for Proliferation Prevention program. Therefore, the Secretary of Energy should not expand the initiative beyond the three nuclear cities until DOE has demonstrated that its efforts are achieving the program's objectives, that is, that jobs are being created in the civilian sector for displaced weapons scientists, engineers, and technicians.

    Agency Affected: Department of Energy

 

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