Powell: Annan Must Be Held Accountable

NEW YORK – U.N. Secretary General Kofi Annan (search) must be held accountable for mismanagement of the $64 billion Oil-for-Food program, Secretary of State Colin Powell (search) told FOX News.

But Powell said the responsibility is not just Annan's to bear. The Bush administration's top diplomat also said the entire U.N. membership — particularly the Security Council, which oversaw the day-to-day management of the program — should take on some of the responsibility.

"So, I want to wait and see the results of the Volcker investigation, as well as the investigations that are being done by the United States Congress, before we make any judgments about the overall management of this by the United Nations, or how it might effect Kofi Annan," Powell told FOX News' Sean Hannity in an exclusive interview.

Former Federal Reserve Chairman Paul Volcker (search) is heading up a U.N.-approved commission probing the Oil-for-Food program. Five congressional committees also are investigating the program.

Oil-for-Food ran from 1996 to 2003 as an international effort to aid the Iraqi people who were hurting under sanctions imposed after Saddam Hussein's invasion of Kuwait. Money from Iraq's oil sales was supposed to go toward buying food and other necessities for civilians but it was discovered that Saddam was scamming millions from the program.

Over 50 internal U.N. audits released by the Volcker commission earlier this week cited numerous examples of egregious mismanagement and lack of oversight of the program but did not specifically cite acts of corruption. The audits noted that if some of the more vital components of the program had been watched over more closely, less money could have gone down the tubes.

Powell said he has confidence in Volcker to effectively conduct the investigation and said he is a "man of great skill and competence and credibility."

"So, I'd like to wait and see for his completed work on this matter," the secretary said. "But what we have heard, so far, is that there were serious problems inside the U.N. on the management of this. We're not sure if there were criminal problems, but there were certainly management problems. "

Powell also hailed Annan as a "very distinguished gentleman" who "has served the cause of humanity well over the years," vowing to continue to work closely with the U.N. chief during the rest of his tenure in that position.

Although some U.S. lawmakers and others have gone so far as to call on Annan to resign — not just for his role as U.N. overseer during the program but also for more personal allegations involving his son's employment at Contecna (search), one of the Oil-for-Food contractors — the administration has resisted echoing that call.

Tsunami Relief, Abbas, Iraq and Bush

On other issues, Powell said in the FOX News interview that the tsunami destruction in Banda Aceh, Indonesia, looks "as if a little nuclear weapon went off and just simply leveled half of a town. Scrapped clean houses, mosques, schools, bridges, cars, boats, vegetation. Everything just gone."

Although the destruction there isn't as bad as that in Sri Lanka or in Phuket, Thailand, he noted, "nevertheless, throughout that part of the world, this really is a tragedy and where 150,000 people lost their lives."

As for those who criticized the United States for not reacting to the disaster quickly enough, Powell said various U.S. task forces were in operation when word came of the tsunami. As casualty numbers grew on Monday, the day after the killer wave hit, the United States gave $4 million in response to a $7 million request for assistance from the International Federation of the Red Cross (search), Powell said. That represented over 50 percent of what was asked for initially. Additional installments of $15 million and $20 million were also donated.

"We said, all along, that we would add whatever funds were necessary. We weren't capping our contributions," Powell said.

"Nevertheless, people started characterizing that as stingy. And the fact of the matter is, it was not. We were there first. And even though people had been using this as a source of controversy, the nations in the region — I can tell you this, because I've been there — they are enormously grateful for our willingness to step forward, and frankly, lead the effort, the international effort, until the international community caught up."

On the recent election of the new Palestinian President, Mahmoud Abbas, Powell was asked if there was newfound optimism by the administration on Middle East peace, since President Bush has invited Abbas to the White House — an invite now deceased former Palestinian leader Yasser Arafat never received.

"I believe he understands that he now has to take a strong position, an open, vocal, clear position against terrorism," Powell said. "But more than just take a position, he has to fight against those forces within the Palestinian community that still thinks there is a role for terrorism. And if he does that, then the United States will be able to support him. And he'll find that Israel can be a partner for peace with him as well."

Powell also expressed confidence that the Iraqi elections — scheduled for later this month — will indeed be held despite the ongoing violence in some regions of the country but said security must be in place.

"I think we have to have this election. An election could be a catalyzing event, to bring the Iraqi people to the realization that the enemies of Iraq are not the coalition forces that are helping," Powell said. "The enemies of Iraq are these terrorists and former regime elements."

As for what the secretary of state will next tackle in his career after he leaves the administration, Powell sad he's received some "very interesting business offers" and he'll likely make "some speeches" and "do some other things that will keep me somewhat in the public eye."

Powell spoke about what he defined as his "good relationship" with the president. "The president, I think, appreciated the fact that I would always tell him what I thought … And sometimes it was in agreement with all of my colleagues, and that was more often than not, and sometimes it was not.

"But that is what I'm supposed to do. I'm not paid to be in consensus. I'm paid to give my best judgment. And that is what I always did. And I think the president always appreciated that," he said.

FOX News' Liza Porteus contributed to this report.