Fin24

DA: DTI concedes over arms deal offsets

2012-03-16 17:16

Cape Town - The trade and industry department (DTI) has conceded that Ferrostaal has invested a total of only €63m (about R628.67m) in arms deal offsets, the Democratic Alliance said on Friday.

DA spokesperson David Maynier said Trade and Industry Minister Rob Davies and officials from his department revealed "shocking new information" about arms deal offsets to parliament's portfolio committee on trade and industry on Friday.

Davies and the DTI officials appeared before the committee to deal with questions raised as a result of a leaked internal audit document produced by Debevoise & Plimpton.

It investigated "questionable and improper payment" made by Ferrostaal, which formed part of a consortium that supplied submarines to South Africa.

The leaked internal audit document stated that, whereas Ferrostaal had an obligation to invest €3bn (about R29.9bn) under the arms deal offset programme, they had in fact invested only €63m.

"The department conceded that the leaked internal audit document was correct and that Ferrostaal had in fact only invested a total of €63m," Maynier said.

"During the briefing, the department also revealed shocking new facts about the arms deal offset programme, including that a total of 50 751 jobs, comprising 16 917 'direct jobs' and 33 834 'indirect jobs', had been created as a result of the arms deal offset programme, rather than the 65 000 jobs promised."

The total actual investment by each of the arms deal companies under the offset programme was:

- BAE/Saab, $203m (about R1.54bn) instead of the $7.2bn (about R54.9bn) obligation;

- German Submarine Consortium, €63m instead of €2.85bn (about R28.44bn);

- German Frigate Consortium, €44.4m (about R443m) instead of €2bn (about R19.9bn)

- Thales, $139.7m (about R1.06bn) instead of $652.4m (about R4.97bn); and

- Augusta (Light Utility Helicopters), $49.3m (about R376.2m) instead of $767.9m (about R5.86bn).

Maynier asked: "How is it that BAE/Saab, which supplied the Gripen and Hawk aircraft, could get an offset credit of $7.2bn, when they only actually invested $203m?

"And how is it that Ferrostaal, which supplied the submarines, could get an offset credit on €2.85bn, when they only invested €63m?"

There were clearly some serious questions to be answered about how the arms deal offset credits were awarded, and how the so-called multipliers were applied, given the wide variance between the total obligation and the actual investment by each arms deal company.

This could only be done if the DTI laid its cards on the table and provided a full report on the arms deal offsets.

"This the minister has agreed to do. The DA therefore welcomes Minister Davies' commitment to make a full report on the arms deal offset programme available to the portfolio committee on trade and industry.

"This will bring an end to a struggle, spanning more than a decade, to squeeze detailed information of the arms deal offset programme from the department of trade and industry," Maynier said.

Comments
  • Francois - 2012-03-16 17:48

    This is kind of strange. Why did it take a leaked audit document for the DTI to admit what we all knew? Did they not read the report? Did Rob not understand it? Can Rob read? Is this why you want to have the secrecy bill? Now that we sort of know the truth, can we get the truth, the whole truth and noting but the truth from the ANC led government, but specifically from the following people: Trevor Manuel, Chippy Schaik, Schabir Schaik, Jacob Zuma and Thaboe - the - wannabe - Racist-but-clear- hypocrite - Mbekkie? Also if comrade Joe took some money, even if it was the small amount of R 100 mil (what is that between friends) and it passed onto his family, can the fiscus get the money back? Zuma, the time has come for you to stand up and be counted. Please act like the president of SA and not the president of only the president's staff.

      Shadho - 2012-03-16 22:01

      Francios. Rob Davies is a communist party member. Probably the worst Minister of the DTI the RSA has had in like forever. Lets see if Zuma has the Guts to boot "davey crooket" out! Wait Zuma takes "davey crooket" with him wherever he goes. What's that telling you? ...Grrrr!!

  • Ryan Holland - 2012-03-16 18:52

    We have to believe that justice can be done and that there is still some honor left in the ANC capable of filling the inevitable vacuum. Ideally, the ANC should be diminished by this but I doubt our electorate would allow that to happen.

  • Phillip Coetzee - 2012-03-16 18:59

    Goverment canceled half of the orders placed. So they are also accountable for the degraded investment.

  • Kolobe - 2012-03-16 19:02

    why is this micky mouse party given so much coverage?

      Francois - 2012-03-16 21:11

      I don't know why the ANC is getting so much coverage - especially as it becomes evident that they are dishonest mice. Maybe you can help us? Is it because the ANC's leaders can only read the CAt in the Hat and watch Mickey Mouse?

  • Vince.York - 2012-03-16 21:13

    Simply put - the SERFS must pay.

  • Shadho - 2012-03-16 21:56

    Rob Davies is the worst DTI Minister ever and the same can be said for other Communist Party Members such as the Minister of DAFF... LOL. Lets see if Zuma has the guts to be rid of them too. Wonder what Blade must be thinking. LOL In fact the whole of the dysfunctional DTI and its sub divisions need to be booted out! As for cancellation of deals. Why not cancel when the Investment offsets supposed to have been given never occurred...DUH! Or wait. Was it or is it a FACT the so called investors got sick and tired of paying the bribes requested of them. Just saying... Going to be extremely interesting to know whose "back got their back pockets filled" once again! Good Bye Rob and take the rest of your dysfunctional department with you. Surely ZimBOBWE or Swaziland will employ you all ,lmao!

  • Glyn - 2012-03-16 22:07

    Rob Davies is an anc lackey. What do you expect?!

  • Glyn - 2012-03-16 22:08

    Rob Davies... Do you have any overseas investments? Please advise. ASAP

  • Jimmy - 2012-03-18 20:54

    This is exactly why the Scorpions were shut down - who's going to find the missing Billions now ? Too many big names involved, I bet !

  • Archie - 2012-03-20 07:31

    If the truth came out and we had a real democratic govermment in place most of the alliance in parliament would be in jail,however we dont, so we will continue to be ruled by the one percent of voters (SACP)in parly,The only way is through the ballot box,that means every possible voter must use his valuable say in the next election and also help enlighten those that dont understand what the corrupt alliance is doing to our country.

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