Airbus upset and lies

HOW can it happen that a man such as the CEO of Armscor can go to parliament and apparently tell a R30bn lie?

Or is the issue really that Armscor CEO Sipho Thomo hasn't lied to parliament, but that the whole debacle around the Airbus A400 military aircraft centres on the manufacturer, Airbus, doing a shuffle and denying what had been said in secret?

Just to recap, in 2005 the government decided it would need eight of these planes to assist with among others, the many peacekeeping missions the country was being dragged into. The cost was estimated at R17bn. Cabinet approved the deal without going to tender, and mandated Armscor to manage the process.

The planes were due to start arriving in 2014, but Airbus experienced technical software problems with the building of the engines. These snags lasted for some time and created a four-year backlog but have now been resolved, according to Airbus spokesperson Linden Birns.

South Africa had paid R2.9bn and another instalment of R1.1 bn is due. But then - and this is where the situation becomes murky - Airbus allegedly informed Armscor last week that the delay will add an additional R30bn to the order, according to Thomo. Birns denied this, saying Airbus has no dealings with Armscor, and that its client is the defence force. Armscor procures arms for the defence force.

Both the defence department through minister Lindiwe Sisulu and Birns said they are in negotiations about the sale and delay. Birns admitted there would be an escalation but insisted the R30bn additional money mentioned by Thomo was a "long way off". However, he couldn't say what the real figure would be.

Sisulu is fuming, saying Thomo has compromised the negotiations. "It's a highly embarrassing matter for me as a minister because that's not how we would have wanted our negotiations conducted...it involves our credibility internationally." She added this information should never have been made public, given ongoing "very delicate negotiations".

Taken for a ride?

What Sisulu is saying is not necessarily that Thomo lied to parliament, only that the truth has created an embarrassment. In other words, though factually correct, Thomo was supposed to hide this "truth".

Which takes one to the question I raised in the beginning: did Thomo lie to parliament - or are those accusing him expecting him to have lied to protect the negotiations? Is he now about to be flogged for maybe answering a question truthfully?

Thomo has gone to ground and is not answering media queries, making it difficult to find answers. We are owed an answer not only by Thomno, but Sisulu too.

For starters, what is the truth? There are real questions too that I think Airbus should answer. For example, in normal business transactions, when one party fails to deliver on a promise on time, whatever penalty that may result goes to the defaulting party.

So how come Airbus's technological challenges with engine software result in escalation of costs for the client and not Airbus? If the software problems have been ironed out and an assembly time table drawn for the planes, why is it impossible for Airbus to indicate publicly what the escalation would be? Why is Armscor being relegated by Airbus to some insignificant and inconsequential organ when it is the procurement arm of the defence force?

Given the responsibilities we carry in the region, the continent and even further afield, we need to have the capability to carry them out. This includes these aircraft - as long as Airbus does not take us for a ride in the process.

- Fin24.com