ya know, you can only take things sooo far..... If I give into one, I’d have to let it all slide.... (shut up, Karl)

Bush declines to back beleaguered Annan

By Anne Penketh, Diplomatic Editor

George Bush pointedly declined to support the United Nations secretary general yesterday after the head of a Senate committee investigating multibillion-dollar abuse of a UN programme in Iraq called for Kofi Annan's resignation.

President Bush called for a "full and open" accounting of the oil-for-food programme, under investigation by five congressional committees and a separate UN inquiry. According to Norm Coleman, the US senator who demanded Mr Annan's resignation on Wednesday, Saddam Hussein illegally diverted $21bn (£11bn).

Mr Coleman, the Republican head of the Permanent Subcommittee on Investigations said Mr Annan should resign because "the most extensive fraud in the history of the UN occurred on his watch".

President Bush, asked yesterday whether Mr Annan should resign, did not reply directly. But he did say, somewhat ominously: "In order for the taxpayers of the United States to feel comfortable about supporting the United Nations, there has to be an open accounting."

Paul Volcker a former US Federal Reserve chief, who is leading the UN inquiry, has refused to hand any documents to the US investigations until his office issues its reports next month.

There is no love lost between the Bush administration and Mr Annan, who declared the US-led invasion of Iraq to be illegal. Britain, France, China and Russia, expressed support for Mr Annan yesterday, but the US pays a quarter of the UN's budget and could make life difficult for the Ghanaian secretary general - as it did for his predecessor Boutros Boutros-Ghali, whom it refused to back for a second term. "They are pounding the UN. They are pounding Kofi. It's worse than under Boutros, and that's saying something," said a senior UN official yesterday.

Mr Annan also faces an internal revolt from the UN staff association which represents 5,000 employees and has accused him of failing to properly investigate accusations of cronyism and sexual harassment against the UN's internal watchdog, Dileep Nair. Mr Annan has also been criticised for clearing the high commissioner for refugees, Ruud Lubbers, over allegations against him. The oil-for-food accusations, coupled with the staff association protests, have prompted other UN staff members to write an unprecedented petition expressing support for their beleaguered chief. By yesterday, 3,000 people had signed.

The oil-for-food scandal broke last January when documents surfaced alleging that, in return for political support, Saddam bribed officials from around the world with billions of dollars from the oil-for-food programme, which had allowed sanctions-hit Iraq to export limited quantities of oil to pay for food and medicine.

Press reports initially focused on allegations against the anti-war countries France and Russia, before moving more recently to turn the spotlight on American firms and individuals. The head of the UN programme, Benon Sevan, has also been accused of accepting bribes, which he denies. The amount of money allegedly involved has also swelled, fuelling anti-UN feeling in the US, where it is now suggested that the funds may have been used to fund the insurgency against US troops in Iraq.

In March, the US General Accounting Office estimated that Saddam raised $4.4bn from illicit surcharges and kickbacks through the oil- for-food scheme, which ran from 1996 until it was wound up after the Iraq war last year. The figure mentioned by Mr Coleman in the Wall Street Journal was $21.3bn.

But UN officials stressed yesterday that Mr Coleman's figures included all the illegal revenue gained by Saddam, not just the oil-for-food programme. Under the sanctions regime, all the contracts with Iraq were monitored by the UN Security Council - including the US, which notably turned a blind eye to billions of dollars worth of oil smuggled through Turkey.

Mr Annan's reputation has also suffered from the fact that his son, Kojo, worked for a company that was given contracts with the oil-for-food programme in Iraq.

Kojo Annan maintains that all reported payments to him were legally proper and only relate to Africa.

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