DEFENCE AMENDMENT BILL [PMB 8-2013] Portfolio Committee on Defence and Military Veterans 27 August 2014 David Maynier MP

Background Minister of Defence and Military Veterans, Nosiviwe Mapisa-Nqakula, recently complained that armaments acquisition compromised the operational capability of the SANDF. There is therefore a need to ensure that armaments acquisition is subject to enhanced scrutiny and oversight by Parliament.

SANDF capability compromised Project Name Description Cost Overrun/Schedule Slip Project Drummer Helicopter Upgrade +/-27 month/2.3 years delay Project Porthole Parachute System +/-34 month/2.8 year delay Project Swatch Camping System +/-36 month/3 year delay Project Vagrant Military Base Security +/-24 month/2 year delay

Proposed changes To add a specific definition for ‘armaments acquisition’; To ensure that quarterly reports on all armaments acquisition projects are tabled before Parliament. To provide for an additional special report within 30 days of any armaments procurement project incurring expenditure over 15% of the initial budgeted expenditure or a delay in schedule of more than 6 months.

Amendment of section 80 of Act 42 of 2002 Section 80 of the Defence Act 2002, Act 42 of 2002 (hereinafter referred to as the Act), is hereby amended By the insertion before section (1) of the following definition: “In this section – ‘Armaments acquisition’ means military equipment and associated parts, not commercially available, required exclusively for military use/purposes.”;

Amendment of section 80 of Act 42 of 2002 - continued (b) By the insertion after subsection (2) of the following subsections: “(2A) Quarterly reports of all armament acquisition projects must be tabled before Parliament; these reports must include the following information: (a) The project name; (b) Description of the armaments being acquired; (c) Project schedule; and (d) The budgeted expenditure for the project.

Amendment of section 80 of Act 42 of 2002 - continued A further report must be tabled before Parliament within 30 days when any armaments acquisition project - (a) incurs expenditure which exceeds 15 percent of the initial budgeted expenditure of the relevant project; or (b) schedule is delayed by more than 6 months. (2C) All reports which are subject to section 80(2B) of this Act must include the following information: (a) The project name; (b) A description of the project; (c) The reasons for the excessive expenditure or delay in schedule; and (d) A plan of mitigation to prevent further excessive expenditure or delays. (2C) All armaments acquisition agreements signed after the date of commencement of this Act are subject to these provisions.”

Conclusion The Defence Amendment Bill [PMB 8 - 2013] provides “early warning” of cost overruns and schedule slips in armaments acquisition projects being implemented by the Department of Defence. With this information the Joint Standing Committee on Defence will be “empowered” to intervene and ensure that the SANDF’s operational capability is not compromised.