POLITICO: US Congress approved $300M for Ukraine. But… the Pentagon has spent it 4 months ago…

10:01 27.03.2024 •

When Congress approved $300 million to arm Ukraine late last week, it marked the first time lawmakers have approved new funding for Kyiv’s war effort in more than a year.

There’s just one problem: The money is already gone, writes POLITICO.

The cash, allocated to the Ukraine Security Assistance Initiative, was included in a $1.2 trillion government funding package signed by President Joe Biden on Saturday. But the money was actually obligated in November while the Pentagon was operating under a temporary continuing resolution, an administration official said.

So while its passage might’ve marked a brief bipartisan win, it was essentially a symbolic move. That $300 million “is not available for us to use now,” said the official, who was granted anonymity to discuss the dynamics of the budget.

The security assistance initiative puts money toward contracts for future deliveries of munitions and equipment for Ukraine. The Pentagon broadcast that it had depleted the account months ago, noting that a $300 million support package in November “exhausts the remaining USAI funds currently available to support Ukraine.”

Even if it were available, the money wouldn’t turn the tide of the war. Rather, it was a gesture from Washington that the U.S. isn’t out of the game, despite House Republican leadership holding up roughly $60 billion in military aid for months.

During that time, Ukraine’s counteroffensive sputtered out and its front-line units ran low on critical artillery shells and other munitions. And lawmakers told POLITICO the money won’t fix Ukraine’s immediate crisis.

“It shows a longer term commitment, and that’s a positive thing,” Rep. Jason Crow (D-Colo.) said. “But the short term problem we have is that Ukrainians needed our support yesterday.”

In the meantime, the White House and Pentagon leaders have warned for months that both pools of funding have dried up and scaled-back efforts to send Kyiv more weapons, ammo and equipment. The U.S. recently scraped together a separate $300 million package of missiles, ammo and other weapons for Ukraine using Army contract savings.

The same thing in Europe. POLITICO notes: “The truth behind the EU’s new €5B weapons fund for Kyiv – EU leaders agreed on the new fund after weeks of talks, but it’s less about money than “creative accounting.”

Europe's new €5 billion fund for Ukraine was lauded as a big win for Kyiv, but the program is more of an accounting procedure than an actual pile of cash.

EU countries agreed Wednesday to create the Ukraine Assistance Fund, which ostensibly boosts the bloc's off-budget European Peace Facility (EPF) with an extra €5 billion.

But despite its name, the "fund" won't actually see a €5 billion infusion — as bilateral weapons shipments can count as “in-kind contributions.”

Bilateral arms shipments to Ukraine will be discounted from cash contributions to the fund at a level of around 43 percent. That means that for every €2.30 in weapons that a country gives Ukraine, it can deduct €1 from what it owes to the fund.

For all countries, this means that as long as they give enough bilateral aid, they won’t have to give any new cash to the fund.

It’s “creative accounting,” one official told POLITICO’s Brussels Playbook.

However, some countries will likely prefer to send money to the fund rather than give weapons directly to Ukraine, a senior EU official said.

"The bilateral in-kind contributions make sense for countries that have a big weapons industry, as they can buy from their own producers," the official said.


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