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10.2  |  Reconstruction: July 2004 to July 2009
The apparent overspend against DFID’s 2005/06 budget was caused by the FCO charge
for life support costs.
DFID’s expenditure on infrastructure projects peaked in 2005/06. Of the £45m spent on
non-life support costs in 2005/06, £35m – over 75 percent – was spent on infrastructure.127
In comparison, DFID spent £15m on infrastructure in 2004/05 and £14m in 2006/07.
Priorities for 2005
210.  In February, Ministers agreed UK priorities for 2005, including “reviewing
reconstruction to find ways to make a difference quickly”.
211.  On 21 January, No.10 commissioned the Cabinet Office to produce a paper on
Iraqiisation, the UK’s military options and a game plan for engaging the US, to support
a discussion on UK strategy after the Iraqi elections.128
212.  The 28 January meeting of the Iraq Strategy Group (ISG) discussed a draft of that
paper.129 Sir Nigel Sheinwald said that Mr Blair would also want the paper to consider
“what could be done to achieve quick and labour-creating results on reconstruction
including outside MND(SE)”.
213.  Sir Nigel asked that the paper also consider the involvement of the wider
international community in military, police and civil administrative capacity-building.
214.  The elections to the Transitional National Assembly (TNA) and Provincial
Assemblies took place across Iraq on 30 January 2005. The TNA did not convene until
16 March, after which negotiations to form the Iraqi Transitional Government (ITG)
continued into late April (see Section 9.3).
215.  On 1 February, Mr Blair suggested to President Bush that they should focus on
four areas in order to exploit post-election momentum:
Iraqiisation;
political outreach, including “whittling away at the opposition, so that the hard
core were left isolated”;
drawing in the international community; and
reconstruction, including areas in which there could be a quick impact
(eg power generation).130
127  Letter Cabinet Office [junior official] to Aldred, 1 July 2011, ‘Iraq Inquiry: request for further information
on funding’.
128  Letter Phillipson to Baker, 21 January 2005, ‘Iraq: Future Strategy’.
129  Minute Ferguson to Sheinwald, 1 February 2005, ‘Iraq Strategy Meeting – 28 January 2005’.
130  Letter Quarrey to Owen, 1 February 2005, ‘Prime Minister’s VTC with President Bush, 1 February’.
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