A400M announcement at 11am


Taxpayers may today learn whether government is going ahead with the acquisition of eight Airbus Military A400M Loadmaster strategic transport aircraft.

Cabinet yesterday for the second time in a fortnight considered the fate of the programme that is running up to five years late and will certainly cost more than the contracted €837 million (R7.4 billion in April 2005 when the deal was signed, now R9.6 billion).

Armscor CE Sipho Thomo controversially told Parliament last month that costs had ballooned from R17 billion to R47 billion, but this has been placed in dispute.

Defence minister Lindiwe Sisulu will at 11am brief the media about the programme and Cabinet’s latest deliberations on the matter.

However, a European source says a delegation from the Department of Defence’s acquisition agency, Armscor is currently in France to discuss the programme with Airbus Military and the European armament procurement agency OCCAR.

The source questions whether Cabinet could have made a final decision if a delegation is still in France for discussions.

A Member of Parliament says Sisulu may today at noon also address a special session of the Joint Standing Committee on Defence on the A400M.

The opposition MP says the feeling is government will continue with the deal, registered against the Strategic Capital Acquisition Master Plan as Project Continent.

The A400M project that will restore the SA Air Force’s in flight refuelling capacity and give it ability to support peacekeepers independent of heavy haul charter flights. The eight aircraft will be assigned to 60 Squadron at AFB Waterkloof.

SA courted Airbus in 2004 to join the A400M programme as a means to develop a local high-technology aerospace industry.

Denel Saab Aerostructures (DSA) and Aerosud are risk-sharing partners in the programme while Armscor, Saab SA and Omnipless are contractors.

DSA CE Lana Kinley says her company expects to realise revenue of R13 billion from the programme over 15 years.

Aerosud MD Paul Potgieter said his company’s share was about €137 million (about R1.5 billion).