Coallition Against Military Spending (CAMS):
Background Information - September 2000
"Never again shall South Africa be the fountainhead of conflict in the region and further afield. Never again shall our country be the source of armaments used to suppress our neighbours. Never again shall we spend our people's resources to develop weapons of mass destruction." -Nelson Mandela, March 1995.
24 July 2000 the first of a series of consultative meetings for a
Coalition against Military Spending was held in Johannesburg. The purpose
of the Coalition will be to campaign against the increases in military
spending by the South African government as a result of the proposed
weapons purchase programmes. The
Coalition will call for the redirection of these resources towards
socially beneficial programmes such as poverty eradication, addressing the
AIDS pandemic and other development priorities.
Further meetings have since been held, including a meeting of a task group to start planning a National Consultation, develop a media strategy and suggest a name, a slogan and a logo. The task group also saw a need for a document outlining background information on military spending, which could be used as a basis of informing Coalition members about issues relating to South African military spending. This is the first draft of that document. It is intended that, once accepted by the Coalition, it will be updated from time to time as and when necessary.
Participants in the initial consultative meetings are:
Other NGOs have also indicated their support.
It is intended that strategies for the implementation of the Coalition's objectives will be developed at the proposed National Consultation, when the Coalition will be formally launched. In the mean time, NGOs, religious bodies, trade unions and grass roots organisations that support the aims of the proposed Coalition are welcome to participate. For further details contact the Campaign Co-ordinator at (011) 403-5315 or by e-mail at firstname.lastname@example.org.
21st June 1995 the Department of Defence (DoD) published a draft white
paper on Defence and invited public comment.
Over 90 written submissions were received and the Parliamentary
Joint Standing Committee on Defence held three special sessions on the
7th May 1996 the white paper was tabled in Parliament.
principle purpose of the white paper was `to inform citizens and other
states, particularly those in Africa, of South Africa's new defence policy'.
dealt with the following issues:
a large extent the white paper took its cue from the constitution, which
states that the defence of South Africa will be military defence.
Whilst it acknowledged `the absence of a foreseeable conventional
military threat', it asserted the need for a `core defence capability
because of the inherent unpredictability of the future'.
It also asserted that `the use or threat of' (presumably military)
`force against external military aggression was a legitimate measure of
last resort when political solutions have been exhausted'.
concept of a `core defence capability' has become a key feature of the
DoD's definition of its future role and function.
Together with the perception of `inherent unpredictability', it has
been used on numerous occasions as a basis for the justification of
`service in the defence of the Republic, for the protection of its
sovereignty and territorial integrity', the constitution provides that the
SANDF may be employed in the following functions:
services were seen by the white paper as being secondary, whereas the
self-defence function was primary. Nevertheless,
the secondary services have also been repeatedly used as justification for
white paper tended to be restricted to matters of broad policy; specifics
of implementation, including force structure and military spending, were
left to the defence review, which was to succeed the publication of the
white paper. As regards military spending, the white paper stated that the
defence review would `present, for the consideration of parliament and the
public, detailed and well-motivated budgetary forecasts and proposals.'
14th May 1996, parliament unanimously adopted the white paper.
12th February 1996 the Minister of Defence launched the National Defence
Review process at an initial consultative conference.
The intention of the Ministry of Defence was that the principles
and policies enunciated in the white paper should be accepted and not
reconsidered. Further consultative conferences and regional workshops were
held in 1996 and 1997. The conferences and workshops were open to the
public. However, in the
drafting of the Defence
Review, which was done by the Department of
Defence, little cognisance was taken of views expressed in the conferences
and workshops by those opposed to the views of the military-industrial
Defence Review dealt with:
feature of the rationale for the `core defence capability' is the shift
from a `threat-specific approach' to a `threat-independent approach'.
Instead of focusing on threats, emphasis is placed on contingencies
and consideration is given to the probability, impact and time-scale of
each contingency. From the
point of view of the military-industrial complex, the advantage of a `threat-independent
approach' is that it can be used to justify substantial military spending
even when there is no perceivable threat.
effect of this will be that South Africa will continue to dominate the
sub-continent in terms of its military power.
The solution proposed by the defence review is to implement `confidence-
and security-building measures (CSBMs)'.
These involve military co-operation, combined exercises, secondment
of personnel, goodwill visits, exchange of information etc., all of which
cost money, and none of which would be necessary if South Africa did not
present a military threat in the first place.
Defence Review's treatment of international peace support operations was
quite tentative. There was an
apparent consciousness that South African military forces are ill-prepared
for such missions. Much of
the chapter is devoted to description of the various types of peace
support operations, and to preconditions for such operations.
But it is made quite evident that the military establishment
anticipates the necessity of preparing itself for such operations.
regards military involvement in policing functions, the defence review was
quite negative. This matter
is further discussed below under "Use of the SANDF for policing
of the features of maintaining a substantial military structure is that,
during peacetime, large components of military personnel, equipment and
facilities are relatively idle. Whilst
it makes economic sense to utilise these components for non-military
functions, the inevitable result is that the functions themselves become
militarised, and vested interests are created in the perpetuation of
military involvement in those functions.
defence review did not propose the discontinuance of any of the
non-military tasks of the SANDF, (e.g. maritime law enforcement, air space
and traffic control, disaster relief, search and rescue).
Of these, only disaster relief was stated to be subject to
financial reimbursement. In general, however, the SANDF does not budget for
non-military functions `since they derive from existing defence
on the `primary and secondary functions' outlined above, the defence
review described four alternative `force designs'.
In military parlance, `force design' relates specifically to the
direct costs of `combat units', and excludes indirect or `common support'
costs, which are included in `force structure'.
the determination of the costs, there was no statement of the assumptions
made with regard to personnel costs, operating costs, capital costs, the
timing of the acquisition programme, or the basis of annualisation of
capital costs. Also, the
costs of the various components were not shown.
This lack of transparency made it difficult to assess the
reasonability of the estimates.
indicated above, one of the main intentions of the defence review was to `present,
for the consideration of parliament and the public, detailed and
well-motivated budgetary forecasts and proposals'.
However, once the defence review was in process, the DoD decided
that it should not address budgetary requirements for the entire SANDF but
only for the `force design'. The
costs for support staff and the associated operational and capital costs
were therefore not determined. The
reason for this decision was that it was desired to expedite the process
in order to obtain approval for expenditure on capital projects during the
financial year ended 31st March 1997.
In the event, the defence review process was not completed during
that year anyway, and the resulting report failed to meet the intentions
specified in the white paper. It
was therefore impossible for parliament to exercise informed votes on the
basis of the defence review.
Joint Standing Committee on Defence accepted the defence review.
DoD found that `it could not muster sufficient interest for cabinet
approval of the defence review prior to tabling ... [it] in parliament'
and the parliamentary debate was twice postponed.
However, the cabinet `approved the policy proposals contained in
the Review, concerning defence posture, defence functions, defence force
design, human resources and part-time forces'.
first and second report of the defence review were finally debated and
adopted by parliament on 20th August 1997.
Because of the failure of the defence review to present the
budgetary implications of its proposals, its acceptance by parliament
effectively constituted the signature of a blank cheque.
18 November 1998 the Cabinet announced that it had considered a report
from the Cabinet subcommittee on the Procurement Program for the South
African National Defence Force. The sub-committee had made recommendations
on six core defence procurement programmes. The sub-committee recommended
that a seventh program for battle tanks not be considered at that time.
sub-committee also made recommendations on the preferred suppliers. The
total industrial participation programmes
were set out for Cabinet. Cabinet authorised the sub-committee and the
Minister of Finance to enter into further negotiations with the preferred
suppliers to achieve an affordable final package.
sub-committee would report back to the Cabinet. These negotiations would
commence shortly. In addition all bidders would receive a debriefing in
the next few days. The quantities of the products were in line with
revised recommendations based on the Defence Review.
A schedule of the arms purchase programme is attached as Appendix A.
The Ceasefire Campaign drew it to government's attention that:
The demilitarisation lobby had argued since the deals were first proposed that South Africa could ill afford the massive costs involved, particularly at time when reconstruction and development must be the priority for government spending. When the costs had been quantified, the impression had been created that the arms purchases would more than pay for themselves through foreign investment in South Africa and through foreign and local sales arising from those investments. Cabinet apparently gave no consideration to the even greater outflow of moneys that would be required by the investors as returns on their investments, or to the costs of the sales. They were apparently misled into thinking that the sales constituted returns additional to the capital invested.
In fact, even on the basis then quoted, the foreign investment emanating from the arms deals was less than the costs of the arms themselves - for some components quite considerably less. The amount paid to encourage foreign investment should be a small fraction of the amount invested, otherwise it is best to rely on local investment.
Nobody seemed to notice that the much-touted 65 000 jobs that were supposed to be created by the arms purchases were costing nearly R500 000 each. For that outlay, we should be getting far more jobs than 65 000. If experience elsewhere is anything to go by, the actual number of jobs created in the long run is likely to be much less than that suggested by the parties to the arms deal, all of whom have an interest in ensuring that the arms deal succeeds. Instead we should be creating jobs in labour-intensive industries.
As pointed out by Terry Crawford-Browne of Economists Allied for Arms Reduction:
The demilitarisation lobby argued that it was time for the new cabinet to demand that each of the packages be reconsidered. It contended that, when this was properly done, it would become evident that the arms purchase programme does not make economic, let alone military sense. South Africa's peacekeeping role in Africa does not require the type of military hardware required for conventional warfare.
Furthermore, the South African economy was already burdened with a huge apartheid era debt, which to a large extent was created for military purposes. We were already spending over R40 billion (or more than 20%) of our total budget on debt servicing. To add to this extensive debt for military purposes was completely unjustifiable at this juncture in the history of South Africa. The proposed purchases comprised weapons systems largely designed for conventional military threats. Yet they were being purchased at a time when, even by the DoD's own admission, there was no "medium-term conventional military threat". By the time any such threat arises these systems would therefore be obsolete, and the capital costs, as well as the interest charges, would have been wasted. In the mean time the country would be unable to finance the reconstruction and development needed to address the far more pressing security threats created by the social dislocation caused by apartheid.
The demilitarisation lobby was aware of a media campaign to highlight the alleged economic benefits of these arms purchases. However, at the end of the day it must be recognised that the arms must be paid for. If a number of countries make investment in South Africa contingent on the purchase of their own weapons systems, we should effectively be reducing our chances of attracting capital from those countries whose bids are unsuccessful. The other countries might well have invested in South Africa anyway.
To suggest that every rand invested in South Africa as a result of the arms deals was a reduction in the cost was economic nonsense. The investors would want to see a return on their investments, and the payment of dividends abroad would represent an ongoing drain on the country's resources. Furthermore, while investors might invest in capital ventures, they might disinvest from the secondary markets so as to avoid overexposure to South Africa. Also, foreign investment means foreign control, which would mean further surrender to the neo-liberal economic agenda.
To suggest that the proceeds of exports and sales arising from industrial participation constituted a reduction in the cost was also economic nonsense. The costs of production and finance must be deducted, as well as the profits payable to third parties.
To add the investments to the proceeds from those investments, as was done in the Cabinet news release, amounted to double-counting and was misleading in the extreme.
The Ministry of Defence and the Defence Secretariat are supposed to be responsible for curtailing the tendency of the military-industrial complex to escalate military spending. Instead, time and again we have heard the Ministry and the Secretariat championing the SANDF and arguing in favour of increased military spending. This makes nonsense of the Ministry's responsibility to parliament and of the credibility of the supposedly civilian Secretariat.
In view of the facts:
the Ceasefire Campaign reiterated its position that the defence budget should be substantially reduced and that the savings should be transferred to those departments which were contributing directly and substantially to the reconstruction of the country and the development of its people, and we urged government to reconsider the Defence Review and to cancel the proposed arms purchase programme.
It was subsequently reported (in June 1999) that government was reconsidering aspects of the proposed R30 billion arms purchase programme. Jayendra Naidoo was appointed to oversee this process.
Senior ANC MPs were now starting to realise that the Corvette purchase was overpriced, resulting in considerable disaffection with the programme. However, they were reluctant to break ranks over the issue. But Patricia de Lille of the PAC has been more outspoken. She called on Cabinet to cancel the deal. Allegations have also been made that other items of the purchase programme are grossly overpriced.
In September 1999, arising out of Naidoo's report, the Minister of Defence announced details of a revision of the weapons purchase programme, including delivery dates. The revised programme is shown in Appendix B. Although the number of fighter and trainer aircraft was reduced, the SANDF was retaining an option (exercisable by 2004) to buy the balance of the numbers originally specified. The announcement was couched in terms of a reduction in the cost of the programme. However, it is noted that the unit cost of each weapon was now greater than originally specified. Furthermore, industry sources suggested that there was no intention on the part of government not to implement the options. The Minister of Defence has indicated that they will "most probably" be exercised. The effect of this announcement was therefore an overall increase in the cost of the programme. Naidoo's claim that the revision resulted in "saving billions and making billions" was therefore grossly misleading.
The number of jobs expected to be generated from the purchase programme is also misleading. The German submarine consortium, for example, suggests that the number of jobs to be created from the Coega harbour and stainless steel plant will not be 16 251 as suggested to Cabinet, but 4000, of which 3000 will be during construction only. Other problems with the Coega scheme include environmental degradation, adverse consequences for tourism and agriculture, expropriation and removal of residents, decreased usage of Port Elizabeth harbour and the financial viability of the project. Recent reports indicate that the consortium has failed to guarantee productivity targets and that the purchase has now been deferred. Similar problems have been encountered with the British and Swedish offset deals.
The purchase agreements were signed on 3 December 1999. Details of the associated industrial participation agreements are shown in Appendix C.
Numerous reports have alleged that officials involved in the arms deals (including acquisitions and procurement director Chippy Shaik) and the former Minister of Defence have benefited either directly or indirectly from them. British Aerospace admits that bribes are standard practice in winning export orders. On 10 September 1999 the Minister of Defence rejected all such allegations.
It was also subsequently reported that Saab-BAe was having difficulty persuading government about how much value the Gripen jet deal would create for South Africa. The Demilitarisation lobby argued that it was time for the new cabinet to demand that each of the packages be reconsidered. It contended that, when this was properly done, it would become evident that the arms purchase programme did not make economic sense.
In January 2000 the Minister of Finance signed loan agreements to cover the costs of the weapons purchase programme over a 12-year period. South Africa would be entitled to draw on the loans over that period and to repay them over periods of 15 to 20 years.
Opposition to the weapons purchase programme is now growing. In June, the President of the Constitutional Court, Judge Arthur Chaskalson, stated: "In real terms it is the law of capitalism that is the highest in the land and not that of the 'democratic' Constitution. . . . But it is possible and necessary for those who lack the basic necessities to take the government to the Constitutional Court for failing in its obligations. The way to answer [the constraint of resources on delivery of social and economic rights] is to socially and morally contrast that with the R32-billion the government will spend on unnecessary arms purchases. . ."
Yet the government is now planning still more weapons purchases. In June 2000 it was announced that a further amount of R10 billion of taxpayers' money was to be spent on an integrated ground-based air defence system and armoured vehicles. And the DoD is now said to be reconsidering the battle tanks that were struck off the list in the initial programme. At the time it was expected that these would cost about R3,6 billion. Including these purchases, the total amount of taxpayers' money to be spent on the proposed arms purchase programmes is R44,4 billion as shown in Appendix B.
In the Defence Review in 1997, the Department of Defence reported as follows:
In the light of the above, the Departments of Defence and Safety and Security are currently formulating plans to allow for the withdrawal of the SANDF from a policing role. The SANDF would then be deployed only in exceptional circumstances, such as a state of emergency or national defence or a breakdown of public order beyond the capacity of the SAPS.
The Ceasefire Campaign endorsed these sentiments, which had now been enshrined in government's "policy framework" on military involvement in policing. Ceasefire, however, added the following considerations:
The Demilitarisation lobby argued that the budget for Safety and Security should be increased substantially, so that a higher calibre of staff could be recruited, trained and supported. Not only was the continuous use of the SANDF for policing contrary to the policy framework set out in the Defence Review. It was a shortsighted, ill-conceived, anti-democratic and ultimately dangerous policy. It would only serve to perpetuate the militarisation of South Africa that was set in motion by the apartheid regime.
For the year 2000/01 the DoD's budget is R13 767 million compared with the estimated expenditure of R10 727 million for the previous year—an increase of about 30%. Of the increase of R3040 million, R2782 million was for financing the arms purchase programme. Despite this increase, the budget allocation was not sufficient to sustain the force design and force structure set out in the Defence Review. Government's policy was therefore to re-evaluate the force design and structure to bring it in line with the medium-term expenditure allocation for defence. For the next two years the budget is expected to increase to R15 272 million and R16 491 million respectively—an increase of over 50% from the 1999/2000 figure. At that stage military spending will amount to over 6% of the national budget. It will continue to increase thereafter until 2004/05. Once again the 'justification' is the arms purchase programme, although numerous arguments for military spending have also been advanced. In response to criticism, government has stated that the arms purchases would be carried out 'without putting a strain on the budget'. Clearly that is deliberately misleading.
Based on the latest figures available, South Africa's military spending is more than three times the total of all its neighbours' military spending combined. Details are shown in Appendix D. This imbalance will tend to increase instability in the region and promote a regional arms race. Already, Ian Khama of Botswana has cited the South African arms purchases as a reason for increasing that country's arsenal.
following arguments presented in some quarters in support of the
continuance of current levels of military spending are fatuous:
- Arguments comparing current military spending with that of
"This conjunction of an immense military establishment and a large arms industry is new in the American experience. ...We recognise the imperative need for this development. Yet we must not fail to comprehend its grave implications. ... In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists and will persist."
Dwight David Eisenhower
Material in this document has been obtained from the following sources:
 An 'industrial participation agreement' is an arrangement whereby the seller agrees to invest in productive capacity in the country of the buyer. The terms of the agreement are decided before the purchase is concluded. Defence industrial participation refers to investment in the buyer's defence industry. Offset agreements may be either investment in industrial participation or counter-purchases (whereby the seller agrees to buy goods from the buyer).
 The medium-term expenditure framework (MTEF) is the method used by the South African government to project budgets over a three-year period. Each department is required to specify (and justify) its expenditure requirements over that period and departures from the MTEF must be negotiated.
WEAPONS PURCHASE PROGRAMME
*Exports and sales are calculated (quite arbitrarily) over the first seven years.
REVISED WEAPONS PURCHASE PROGRAMME
*This item was omitted from the list quoted in the medium-term expenditure estimates for 2000/01.
INDUSTRIAL PARTICIPATION AGREEMENTS ASSOCIATED WITH
WEAPONS PURCHASE PROGRAMME
(excluding investment projects still under consideration)
German frigate consortium:
German submarine consortium
Agusta light utility helicopters:
GKN maritime helicopters:
BAe/SAAB light fighter trainers and Gripen aircraft
depending on exercise of option for additional light fighter trainers:
SOUTH AFRICAN MILITARY SPENDING COMPARED WITH ITS NEIGHBOURS*
*source: SIPRI Yearbook, Oxford, 1999
†latest year for which figures were available
‡at constant 1995 prices and exchange rates
|Source: Information kindly provided by Ceasefire
Campaign, Johannesburg, Rep. South Africa