Defence industry lekgotla must look to action, not plans

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If next month’s long delayed South African defence industry (SADI) lekgotla is to be of any value it must be in the form of definitive action, not “another plan to plan”.

This opinion comes from James Kerr, a Pretoria-based consultant and long-time defence industry observer. Reacting to last week’s call by the SA Aerospace, Maritime and Defence Industries Association (AMD) for input ahead of the lekgotla, he said it was an opportunity, notwithstanding three problem areas. They are lack of demand; an increase in competition and costs; as well as the impact of a struggling international – and local – financial situation.

Opportunity-wise, he sees it being successful if agreement can be reached on what is convenient, fits and comes at the right time for the SADI and the greater South African defence capability.

In support of his projection he notes a basic analysis of core problems. At the same time the analysis provided a common objective to unlock “industry potential” by focussing on innovative export products, with government promoting the industry and providing financing support.

Kerr, a specialist consultant on proposal services for the aerospace, defence and related industries, sees the SADI lekgotla as a way government can ask how it can assist the SADI.

Elaborating, he cites seven hurdles to be cleared if the SADI is to move ahead.

The first issue that must be addressed is an export focus. “The industry needs government assistance to be export friendly. The SADI needs to know who and what can be traded. NCACC (National Conventional Arms Control Committee)/DCAC (Directorate Conventional Arms Control) need a serious revamp.” In this regard Kerr notes it would be good if an annual Green List of countries and products for automatic export approval was compiled and made easily available.

Secondly, financial support and product promotion is essential along the lines of the United Kingdom Defence Solution Centre.

Number three on Kerr’s list is to make it clear the SADI is not just Denel. “The SADI needs to be promoted by government, but government is clueless as to who or what the SADI’s capabilities are. We read about 120 dedicated defence related companies. I propose each SADI entity – not just AMD members – give a maximum minute elevator pitch [at the lekgotla] to tell all who and what we have in South Africa,” is his take on the overall local defence industry.

Number four is finance with Kerr asking for public/private partnerships and alternative support options to be examined. He would also like to see the SADI taking a larger part to support overall SANDF capabilities, pointing out the 2015 Defence Review indicates this could be “explored”.

There’s no need for “all the secrecy in acquisition” he maintains, pointing to an AMD call for the SCAMP (Strategic Capital Acquisition Master Plan) to be open for SADI scrutiny. “Ten years ago we were all able to see who bid for Armscor tenders and who won. This is gone. Is it to shield the ridiculous excess the current procurement regulations add to base product prices? The SANDF is in a funding crunch, yet is forced to accept premiums in pricing as the lowest bidders cannot offer solutions.”

Kerr is of the opinion the SADI and the overall security sector are there to protect the economy with the industry able to serve the full security sector spectrum. This he sees encompassing the SANDF, SA Police Service (SAPS), DFFE (Department of Forestry, Fisheries and Environment), Intelligence, Border Management Authority (BMA) and Correctional Services possibly expanded to private sector security companies.

In closing, he points out that threats are changing. In the light of this South Africa needs a Strategic Defence Review (SDR) rather than a public participation event. “Use the Australian SDR terms of reference as a guide,” he said adding “national defence is a whole-of-government approach and not a vote garnering item”.