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10.2  |  Reconstruction: July 2004 to July 2009
30.  Based on those objectives and risks, the two “reconstruction and development”
priorities were:
To bridge funding shortfalls over the summer, when CPA and Development Fund
for Iraq (DFI) projects ended, by implementing DFID and MOD job creation
and infrastructure programmes. The UK had to maintain pressure on the US to
spend its money in the South, quickly.
To press the UN and the World Bank to send key staff back to Iraq.
31.  The paper identified monthly milestones on the political process, reconstruction,
and SSR tracks between July 2004 and January 2005.
32.  At the DOP meeting, chaired by Mr Blair, Ministers reported that:
Progress was being made on reconstruction. Electricity production was at its
highest level so far (at 5,500 megawatts), the UK was providing expert advice
to the IIG, notably to Prime Minister Allawi’s office, and DFID and the MOD had
funds in place to mitigate a possible funding gap over the summer.
Implementation of the main infrastructure contracts was slow.12
33.  DOP agreed the priorities set out in the paper, and commissioned DFID to
produce a note on infrastructure issues which Mr Blair might use in discussions with
President Bush.
34.  The FCO paper was not the integrated strategy that Ministers had requested on
1 July.
35.  The DFID note that was subsequently sent to No.10 welcomed the anticipated
arrival of the PCO Regional Co-ordinator in Basra, and continued: “But PCO
[Co-ordinator] will need a team to support him. Little sign of Supplemental [IRRF2]
contractors on the ground. Needs impetus.”13
36.  President Bush and Mr Blair spoke by video conference on 22 July. Mr Blair’s
briefing for the discussion, which had been produced by Mr Antony Phillipson, Mr Blair’s
Private Secretary, recalled that Mr Blair had told DOP that he would speak to President
Bush about the pace of reconstruction spending.14 Since then, Sir Nigel Sheinwald,
Mr Blair’s Foreign Policy Adviser, had discussed the issue with Dr Condoleezza Rice,
the US National Security Advisor. Mr Phillipson suggested that Mr Blair “might just
mention” UK concerns about the situation in the South.
12  Minutes, 15 July 2004, DOP meeting.
13  Letter Malik to Quarrey, July 2004, [untitled].
14  Minute Phillipson to Prime Minister, 22 July 2004, ‘VTC with President Bush, 22 July’.
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