Armscor needs to reevaluate its deliverables in light of constrained budget, Mostshekga says

Of the R51.8-billion budget allocated to the Department of Defence and Military Veterans (DDMV) for the current financial year, R1.4-billion has been allocated to the Armaments Corporation of South Africa (Armscor) to manage the acquisition of defence prime mission equipment, development and maintenance of critical defence technologies, and the management of strategic defence facilities as regulated by a service level agreement between the department and Armscor.

However, with this agreement coming to an end at the end of the current financial year, Defence and Military Veterans Minister Angie Motshekga has said it is imperative for Armscor to reevaluate its deliverables within the context of the financial challenges ahead.

“Budget cuts are not a nice thing but a necessity. Government is cash-strapped, and we have to do more with less. We, therefore, should find creative and innovative ways at a reasonable cost to deliver our mandate,” she said on the second day of the African Aerospace and Defence (AAD) tradeshow and exhibition at Air Force Base Waterkloof, in Centurion, on September 18.

An additional R2.6-billion has been allocated to the Department of Public Works and Infrastructure for lease payments, assessment rates, refurbishment, maintenance and repairs and municipal services, which the DDMV is managing.

On July 15, Motshekga presented to Parliament the need to review certain key chapters of the Defence Review 2015. She said that the department was now finalising that task.

“[President Cyril Ramaphosa] is well abreast of the developments and we have therefore agreed with the Military Command upon a soldier-first principle in the work,” she said.

She expressed frustration at the budget cuts but hoped that the AAD show would help invigorate investment.

“I know that we deserve more, however, [our allocated budget] will go a long way in ensuring that we achieve our mandate. With [the AAD] show, we envisaged that we will also attract investment, create the much-needed jobs and contribute to the country’s national fiscus,” Motshekga added.

She said it was imperative that the defence sector played a role as a catalyst in creating jobs and reducing unemployment, noting that more than 1 300 jobs were created during the duration of the previous 2022 AAD show. Then, the show itself contributed more than R135-million to the South Africa’s GDP, with trade revenue of R150-million and R65-million in tax revenue.

“This is no mean feat. We are therefore looking forward to a bigger and better show this year,” Motshekga said.