Text of letter from Terry Crawford-Browne to Roelf Meyer, Chairperson of the Defence Review Committee, May 4 2012
Mr Roelf Meyer, Chair
Defence Review Committee
May 4, 2012
1. As I commented yesterday, civil society representatives during the 1996-1998 Defence Review repeatedly warned that offsets are internationally notorious for corruption. We at the Coalition for Defence Alternatives pleaded with every cabinet minister not to proceed with the absurdity that R30 billion on armaments would generate R110 billion in offsets to create over 65 000 jobs.
The affordability study that went to Cabinet in August 1999 also warned the ministers that the arms deal was a reckless proposition that could lead the government into mounting fiscal, economic and financial difficulties. At public hearings into offsets held by the parliamentary Trade and Industry committee then chaired by Rob Davies, every submission by business, academics, trade unions, churches and NGOs also warned that offsets are nonsensical. Instead of paying heed to these warnings, Minister Alec Erwin told ETV television reporters after the hearings that "I and my cabinet colleagues are neither criminal nor stupid."
Instead of job creation, the affordability study warned that negative economic consequences of the arms deal would be substantial increases in unemployment. It is not coincidental that unemployment rocketed from 13% in 1994 to almost 40%. The shambles in the SANDF described in today's Mail & Guardian is another consequence (see here).
The Auditor General also warned Parliament that offsets could not be guaranteed, and reported in the JIT report that he was not permitted details of the offsets on the spurious excuse that the contracts were "commercially confidential". Archbishop Njongonkulu Ndungane called for a judicial commission of inquiry in August 1999, but was also brushed off. President Thabo Mbeki "doctored" the JIT report purportedly to exonerate the government from malpractices, and abused his official powers in unsuccessful efforts to cover up the arms deal scandal.
So it has been a long battle to get to the Seriti Commission. The President's legal advisers simply could not refute the mountain of evidence of corruption - amongst which are 160 pages of affidavits that detail why and to whom the BAE bribes were paid, and into which bank accounts. In their last action in November 2008, the Scorpions seized 460 boxes and 4.7 million computer pages of evidence against BAE. The German frigate and submarine consortia were equally corrupt.
Three of the Seriti Commission's six terms of reference deal with offsets. The rationale for the arms deal, confirmed by Joe Modise in Parliament in March 1999 and others, was the offsets. Even the Department of Trade and Industry belatedly concedes that the offsets did not materialise, and that South Africa was conned. Quite clearly, the offsets were fraudulent and were simply instruments to pay bribes.
You'll be aware that section 217 (1) of the Constitution requires government procurements to be conducted in "accordance with a system with is fair, equitable, transparent, competitive and cost effective." I now have a legal opinion from a prominent advocate that offsets fail to meet that requirement. The arms deal was therefore unconstitutional and illegal right from inception.
Furthermore, the remedy for fraud is cancellation of the contracts, return of the goods and recovery of the monies. The financial consequences of cancellation will therefore fall to the British and German taxpayers who guaranteed the Barclays Bank and Commerzbank loans. South Africans will hopefully receive a tangible apology worth about R70 billion, and the warships and warplanes can go back to Europe!
I attach that legal opinion by Advocate Geoff Budlender SC which, with other material, I will present to the Seriti Commission. My legal advisers and I will press for the arms deal to be cancelled as fraudulent and thus unenforceable and, if necessary, will return to the Constitutional Court.
2. Your predecessors would not listen, but I am astonished that Defence Review 2012 is equally nonsensical. It is as childish as the nonsense we sat through during 1996-1998 that submarines are the ultimate stealth weapons to protect fish, and that South Africa needed the capacity to give the Americans a bloody nose. My colleagues reckon that it fails at least 54 times to meet section 198 (1) on the constitutional principles that govern national security. I hope that you are not going to subject the country to a repeat of the arms deal scandal.
3. I reiterate my concerns regarding Denel. It is unfixable, and transferring it from Pubic Enterprises to Defence makes not one jot of difference. Worldwide, the arms industry is a highly subsidised business, and it is capital intensive and not labour intensive. The notion that Denel can be fixed to operate at a profit is plainly absurd. Besides, what country will South Africa become that makes weapons to kill people for profit?
Being subsidised, Denel also diverts public resources away from socio-economic priorities such as education and health. We already go from one arms export scandal to the next, and the NCACC is a farce. Do we want to perpetuate South Africa's reputation for selling weapons to support dictators such as Mugabe and Gaddafi, and that the dirtier the war the better we like it?
4. As required by section 198 (1), I suggest that human security, not military security, is the constitutional imperative, and that the draft document now being circulated should be scrapped. Ironically, and as confirmed by today's Mail & Guardian article, South Africa is moving towards a "Costa Rica option," albeit by default and gross mismanagement. Amongst the suggestions I make are:
a) that the Army, Air Force and Navy are all abolished, and are replaced by a respected and capable police service, a coastguard and disaster management service. South Africa presently faces the outrageous situation that the previous commissioner of police is in jail, his successor is suspended, and that his would-be successor is also under a massive cloud of corruption and murder allegations. The widespread privatised security services should be incorporated into a new police service so that they do not in future become a risk to the state.
b) that a voluntary Peace Corps is established wherein youth are trained in life and job skills so that they become employable, and thus remedy some of the disasters of our education system.
c) that land occupied by redundant military bases is redeveloped, either for low-income housing in urban areas or agriculture in rural areas.
The department of Public Works is possibly the largest landowner in South Africa, much of its land being redundant military bases. There is a desperate need for land for a variety of reasons, yet the current Minister of Public Works recently conceded that his department is bureaucratically unfixable.
Civil society organisations and activists are acutely conscious of the socio-economic crises that we face in South Africa. We are happy to be of assistance but, after previous experiences, we will not take kindly to rubber-stamping what purports to be a consultation.
Copied to: Archbishop Thabo Makgoba
Archbishop Njongonkulu Ndungane
Archbishop Desmond Tutu
Professor Ade Adebajo, Centre For Conflict Resolution
Advocate Paul Hoffman, SC
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