Armscor severance or special package offers taken by 29 employees


The 2017/18 financial year saw 29 Armscor personnel “granted severance or special packages” compared to two in 2016/17 and zero the previous financial year.

Response to a Parliamentary question posed by opposition Democratic Alliance (DA) shadow defence and military veterans minister Kobus Marais states that early retirement and voluntary severance packages were offered to Armscor employees aged 55 and over “subject to the retention of skills, availability of successors for critical positions, non-compromise in meeting operational deliverables and financial implications per employee”. No details are given of the positions exited by employees taking packages.

In its latest available annual report, the State-owned defence and security acquisition agency rates capability retention and succession planning a key strategic initiative.

It identifies 77 key positions as well as 82 successors to fill them indicating there is a pool of skill and experience retained in Armscor.

Progress with succession planning is evident in that 33 promotions were made in the 2016/17 financial year (the latest for which data is available) and 16 of these went to identified successors. They were spread across specialist positions, middle and senior management.

The total number of people employed by Armscor, including in its research and development arms and the Simons’ Town naval dockyard, is 1 502.

As far as the financial implications of the severance and special packages, the response given by Minister Nosiviwe Mapisa-Nqakula gives two options.
“Where Armscor could derive savings within three years of the total severance package, an offer was made for two weeks’ pay for every year of service plus company pension benefits up to 60 years of age. Twenty-three employees accepted this package.
“Where Armscor could not deliver savings within three years of the total severance package, a one week counter-offer was made for every year of service plus company pension benefits to the age of six. Six employees accepted this package.”

The Minister did not disclose any Rand value of the exit packages other than to tell her questioner the proposal was approved by the Armscor board.

As far as salary increases are concerned Armscor said it operates within the confines of the “decreasing budgetary allocation from the Department of Defence (DoD)”.

Taking the Consumer Price Index and fiscal considerations into account Armscor does not anticipate across the board salary increments to exceed single digit percentage numbers according to Solomzi Mbada, Group Executive: Corporate Support. Mapisa-Nqakula stated that no budgets were increased to fund new salaries.