Cancel crooked Gripen contract

Taxpayers should gasp at BAE’s latest bleat of how it was obliged in a highly competitive market to provide offsets of 400% to secure its arms deal contracts (Painted into arms deal corner, September 17). Only a moron would swallow such nonsense that every R1 spent on armaments could generate R4 in offsets to create more than 65000 jobs. Yet the former defence minister, the late Joe Modise, assured Parliament in March 1999 that the arms deal would “enormously benefit South African industry ”.

Modise also insisted that his cabinet colleagues had gone through the arms deal transaction with “a fine-tooth comb to ensure an ethical outcome”. Recent reports on the continuing financial disaster that is Denel confirm that ministers were easily duped and misled.

Section 217 of the constitution clearly stipulates that government procurements must be conducted in a manner which is “fair, equitable, transparent, competitive and cost- effective”. That requirement clearly was not adhered to. For that reason alone, BAE’s arms deal contracts can still be cancelled before the remaining 17 BAE/Saab Gripen fighter aircraft are delivered.

The former secretary for defence rightly resigned rather than be held responsible for the offset fiasco. The former auditor-general also objected to the offset proposals, but buckled under presidential pressure. In addition, the arms deal affordability study in August 1999 warned that the deal could “lead the government into mounting fiscal, economic and financial difficulties”. That study was ignored, but its warnings have now been proven.

A British government minister eventually admitted BAE had paid bribes to secure its warplane contracts but pleaded they were “within reasonable limits”. Affidavits in my possession detail how BAE paid those bribes of £115m (R1,5bn), to whom and into which bank accounts. BAE’s habitual practice of bribery to secure contracts is under investigation in eight countries and by the Organisation for Economic Co- operation and Development, which holds oversight responsibilities over international corruption agreements. The BAE supply contracts also in my possession give the state the right to cancel the contracts and even to claim compensation.

With Finance Minister Pravin Gordhan facing a fiscal deficit estimated at between R60bn and R200bn, cancelling the BAE contracts should be his first option. The financial consequences of this would fall to British taxpayers under the Export Credit Guarantee Department’s guarantees of BAE’s contracts. Let the British taxpayers then ask why their government exerted massive pressures on our government to buy warplanes which the air force rejected as too expensive and unsuited to SA’s needs.

Terry Crawford-Browne

Cape Town