AG finds a R2.9bn irregularity in SAAF A400M acquisition: DA

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The Auditor-General’s (AG) annual report of the Department of Defence has found a possible irregular expenditure of R2.9-billion on the procurement of the Airbus A400M military transport for the South African Air Force.

The SAAF is acquiring eight of the large aircraft under Project Continent, a R7.4 billion programme announced in 2004.  

The aircraft were scheduled to be delivered between 2010 and 2012. They are now expected from 2014, following delays beyond the SAAF`s control.

Hard copies of the Department of Defence 2008/9 Annual Report, containing the AG`s report, were tabled in Parliament today. The DoD has declined defenceWeb`s request for an electronic softcopy to verify a Democratic Alliance media statement on the matter.          

DA shadow defence minister David Maynier says this year also marks the DoD`s tenth successive qualified audit opinion.

“The DoD`s finances are in meltdown,” Maynier says.

“The Auditor-General`s 2008/2009 annual report on the special defence account reveals that nearly R3 billion of possible irregular expenditure on the Airbus A400M aircraft programme – possible irregular expenditure of R2.9 billion may have occurred in the acquisition of the Airbus A400M aircraft as a result of the tender process.

“Moreover, the Auditor-General`s 2008/2009 annual report on the defence department reveals that over R15 million in irregular expenditure on the Airbus A400m aircraft programme is being investigated – R15 242 000 of irregular expenditure on the A400m strategic heavy lift aircraft programme is being investigated with a view to disciplinary action or criminal proceedings,” Maynier charges in his statement.

 

Maynier did not further explain the AG’s concerns or the irregularities found.   

Elsewhere in the DoD Maynier says the AG found R118 473 000 in irregular expenditure. No supporting documentation could be provided for R77 042 781 of this expenditure.

In addition, just under R200 million paid to consultants was unverifiable – “there was no proper internal control systems or supporting documentation provided by the defence department for R193 105 851 spent on consultants”, Maynier adds.

Furthermore, the AG described R4.587 million in expenditure as “fruitless and wasteful” and found the DoD still has no proper asset register.



Maynier says the DA will approach Themba Godi, chairperson of the Standing Committee on Public Accounts (SCOPA) to have a special hearing on the state of financial management within the department of defence; and on the procurement of the A400M.