Declining budgets are threat to Armscor


Armscor chief executive Solomzi Mbada told a Parliamentary portfolio committee the future of the State-owned defence and security acquisition agency is not healthy, with sustainability under threat due to declining budgets and transfer payments.

Armscor, he told the Portfolio Committee on Defence and Military Veterans (PCDMV), made optimal use of its allocation which does not include personnel costs. These are the single largest expense of the Erasmusrand-headquartered entity.

His presentation listed 10 Armscor strategic facilities. They are: Hazmat, Ergotech, Protechnik, Alkantpan, Gerotek, Institute for Maritime Technology (IMT), Armour Development, Flamengro and Temani Core Services.

Number 10 is IPMAD core services which, according to the Mbada presentation, provides general intellectual property management; intellectual property exploitation, new venture management and contractual management of intellectual property.

As far as strategic outputs are concerned there are four components.

One is revenue generation with the target of allowing Armscor to meet its own short to medium term funding demands. Cost management geared to “capability management” and cost reduction is the second with efficient and effective delivery the third. The target here is reducing turnaround time for customers.

Number four is stakeholder management which Armscor sees as the development and maintenance of long lasting, strategic relationships with key stakeholders.  There are two goals set for this: a stakeholder engagement strategy and what is termed “transformation of corporation (presumably referring to Armscor, officially the Armaments Corporation of South Africa)”.