Armenia’s cash-strapped government plans to inaugurate soon a $28 million facility with whirlpool bathtubs, restaurants and tennis courts which is supposed to serve as a “training center” for Armenian tax and customs officials.
The government’s State Revenue Committee (SRC), which comprises the national tax and customs services, began building the center in the resort town of Dilijan in 2011. The construction gained momentum after the SRC was incorporated into the Armenian Finance Ministry over a year ago.
The total cost of the controversial project is estimated at 13.5 billion drams ($28.4 million), a hefty sum for a country with an annual state budget equivalent to around $3 billion. In written comments to RFE/RL’s Armenian service (Azatutyun.am), the Finance Ministry said it will be completed by the end of this year.
The ministry defended the need for the expensive center, saying that thousands of its employees, most of them charged with tax collection, will be educated, trained and retrained there.
The sprawling Dilijan complex tucked into a picturesque forest will have four lecture rooms and auditoriums occupying only a small part of it. They will be dwarfed by other, more luxurious facilities serving a different purpose. Those include swimming pools with mosaic tiles, whirlpool bathtubs, gyms, saunas, bars, restaurants, tennis courts and a cinema hall equipped with expensive projection and sound systems.
The ministry statement denied any contradiction between the official mission of the “training center” and these leisure facilities. It said tax inspectors and other ministry staff need to “combine the development of their professional skills with leisure.”
Critics dismiss such explanations, saying that the government could and should have used its scarce budgetary funds for more urgent needs. “If leisure is such an important part of that project, maybe they should have called it a recreation facility, rather than a training center,” said Artak Manukian of the Anti-Corruption Center, the Armenian affiliate of Transparency International.
Manukian also decried a lack of transparency in the project implementation. He argued that the Finance Ministry and its fiscal division, the SRC, have contracted two private firms to build the Dilijan facility without any competitive tenders. “Corruption risks only increase in these circumstances,” he told RFE/RL’s Armenian service (Azatutyun.am).
The SRC is widely regarded in Armenia as one of the most corruption government agencies. Many of its employees are thought to be wealthy individuals with extensive business interests.
In an April 2014 report, Armenia’s state human rights ombudsman, Karen Andreasian, said that tax and customs officials as well as their relatives routinely engage in business and enjoy “illegal advantages over other entrepreneurs.” Gagik Khachatrian, the then head of the SRC, disputed those claims. Khachatrian, who initiated the Dilijan project, was appointed as finance minister shortly afterwards.
Armenian media reports have for years linked Khachatrian with a host of lucrative businesses, including a major Internet and cable TV service provider, two food-importing companies, one supermarket, a car dealership and a luxury watch store in Yerevan. Khachatrian has repeatedly denied any involvement in entrepreneurial activity or corrupt practices.