Penniless army, unserviced aircraft — defence pleads for R9bn

Defence and military veterans minister Angie Motshekga has pleaded with the Treasury to provide the department with R9bn to ensure the smooth operation of the army.

The cash-strapped army's operations, locally and regionally, have been severely hampered by inadequate funding, leaving its aircraft, equipment and vehicles largely unserviced and in a state of disrepair.

Motshekga on Wednesday told the standing committee on appropriations that the department needs R9bn urgently from the fiscus to meet its constitutional obligations.

“We would like parliament as a whole to really understand where the pressures are and support us when we come before committees. Most of our aircraft, ships and vehicles are unserviced,†the minister said. “We have given the National Treasury a list that comes to R9bn, which we need immediately.

“We are campaigning and soliciting support as much as possible [to get additional funding].â€

The department's compensation of employees budget has been exceeded by about R3.7bn, with the department telling parliament that its allocation is insufficient to sustain the existing personnel structure. The shortfall has been exacerbated by reserve force utilisation exceeding planned man-days.

The department also told the committee it projects a compensation of employees shortfall of more than R13bn over the next three years.

The department of defence's 2026 annual performance plan is replete with warnings that the acute underfunding facing the SANDF risks undermining the country's sovereign defence industry base — with many programmes underfunded by more than 40%.

One such key capability facing steep underfunding is military intelligence — key in informing decision-making for national defence and strategic planning — which is having to contend with underfunding of about 48%.

Edem Abotsi, acting CFO of the department, outlined the dire state of the department's finances, which has seen it for the first time yet to turn to running an overdraft facility.

“The challenge started in 2017 through Fees Must Fall, where our budget was reduced. Since then we have incurred an irregular expenditure of R10bn because we utilised the goods and services money to augment the underfunding of the compensation of employees,†Abotsi said.

“We were sacrificing goods and services, and this was not sustainable. From 2022/23 we had to exceed our overall budget by R12bn. Overall, over the last eight to nine years, we have accumulated an irregular expenditure of R22bn due to the underfunding of the defence force.â€

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About 65% of the department's budget is consumed by employee costs, leaving little to upgrade its ageing, outdated equipment.

The department had to use its own resources to fund Operation Prosper, announced by President Cyril Ramaphosa in February, in which more than 2,000 soldiers were deployed in five provinces to repel organised crime.

The National Treasury is yet to pay the nearly R900m needed for the operation, forcing the department to divert funds from other programmes in what deputy minister Bantu Holomisa describes as akin to “stealing from Paul to pay Peterâ€.

Holomisa called on the Treasury to be alive to the needs of the department.

“The expenditure position of the department is concerning. We must strengthen financial discipline, improve planning and ensure accountability where there is mismanagement. However, we must also be honest that underfunding defence has consequences beyond financial statements,†Holomisa said.

“The reality is that when the president and parliament give the SANDF a mandate, the defence force must execute, as the operational imperative is immediate and the fiscus cannot become an afterthought.

“I am not suggesting that defence must be exempt from accountability. We must have financial controls, but accountability must work both ways. If we give defence a mandate, we must fund that mandate. National Treasury must be responsive to the financial implication of presidential mandates.â€

Mmusi Maimane, chairperson of the standing committee on appropriations, expressed his concern at the state of the department's finances.

“I am in the camp that believes the SANDF must be funded adequately to modernise and be able to protect the sovereignty of the country,†he told Business Day.

Meanwhile, state-owned arms manufacturer Denel told the committee the department has blocked its plans to dispose of some of its assets.

The abandoned sale was part of the R3.4bn bailout it received from the Treasury three years ago. Denel initially requested R5.2bn, but the Treasury said they could fill the shortfall by selling noncore assets.

Denel wanted to put its vehicle manufacturing facilities in Benoni and Alberton up for sale, alongside its stakes in associates Rheinmetall Denel Munition — which manufactures heavy-calibre ammunition, propellants and pyrotechnics — and Hensoldt Optronics, which produces high-tech electro-optical, laser and airborne helmet tracking systems.

Tsepo Monaheng, Denel Group CEO, said the department stopped the sale process in its tracks, insisting the assets were core to its business.

The rejection saw Denel pivot to trying to lease the vehicle-manufacturing facilities to the private sector to earn income while it prepares to use them when it gets back on its feet.

Motshekga explained the rationale behind the department's position on Denel's assets.

“Denel represents the capacity of the state to protect its sovereignty. If there is one thing I always tell the department, it is that we inherited from the apartheid government a good Denel. It is actually the family's silver.â€

Business Day