Committee Report on Defence and Military Veterans 2014 Budget

Meeting report

Opening Remarks
The Chairperson welcomed the Members and opened the meeting.  The Committee would vote on the report on the Department of Defence and Military Veterans budget.

Committee Report on Defence and Military Veterans 2014 Budget
Mr D Maynier (DA) said that in order for the Committee to adopt the report they would need to be quorate.   There were further problems, in that they had received the report only a few hours -- and in some cases, only minutes – ago.  There were still some outstanding questions from the Department which had not been replied to, and were not included in the report.  Another issue was that one of the recommendations was incoherent, in that it said that the Department of Defence was under-funded, but that the Committee supported the budget.   If it was the Committee’s view that the Department was under-funded, then the question was: What did the Committee recommend -- an increase in funding, or a reallocation of funding within the existing budget?  These were the issues that the Committee should apply its mind to, and which should be included in the report.  If the chairperson was determined to go ahead, the DA would object and ask for their objections to be recorded.

Mr D Gamede (ANC) said the report before them was not final.  They were there to finalise and adopt the report, and this was the time to make any additions or submissions.  He agreed with Mr Maynier’s observation about the recommendation needing to be clarified.  The Committee had to state clearly whether they supported an increase in the Defence budget, for instance, with respect to emergency services, which had no funds.  They should deal with the report as it was, develop certain points and then adopt it.

The Chairperson thanked Mr Gamede and asked for clarity on whether they should adopt the report, pending amendments or other issues.

Mr B Bongo (ANC) said that Members had received the report today, but from what had already been said, it seemed as if they needed to engage on what had been presented to them.  He supported Mr Gamede’s view that the Committee should add whatever needed to be added to the report, and should proceed with adopting it.

The Chairperson said in terms of the recommendation, it could be summed up by saying that now that the Defence Review had been tabled, the Committee supported the resourcing of the Defence Force, or words to that effect.

Mr Maynier said Members should be wary of pre-empting their deliberations on the Defence Review.   The Committee might reach a different conclusion, and the proposals the Defence Department makes are far reaching, particularly where the budget was concerned.  They could not in good faith reach conclusions about the Defence Review before deliberating on it.   There was much to recommend in the Defence Review, but there were also some fairly major problems which would have to be deliberated on by the Committee when it dealt with the Defence Review.  That was why they should be careful.

The Chairperson said this was accepted.  However, the question was whether the Committee should say that the Department was under-funded, and should therefore receive an increase, or not. Under-funding went hand in hand with capabilities, so if the Committee felt the Department could not achieve its objectives through lack of capability, the Members should say the Department should be resourced in terms of its capabilities, so it could fulfil its mandate

Mr Maynier said that was one possibility, but he had difficulty with this because the Department at the same time had to make the difficult decisions to curtail expenditure on certain programmes so that they could fund other programmes from within their existing budget.   He would have difficulty with the Department simply saying it needed a budget increase, when what the Department really needed to do was to make the tough decisions about how to allocate the existing budget -- what programmes to cut in order to fund other programmes within the existing budget.   There was a shortfall of R1.2 billion on personnel costs.  The Department spends more than 50% of its budget on personnel, so ultimately they would need to make a decision to downsize or right-size the Defence Force in order to save on personnel so they could properly finance operations and acquisitions.

Mr Gamede said he did not think they needed to have a repeat of yesterday’s meeting, where they had already engaged on all these matters.  They were taking different directions to the same point.  He said the President announced in the State of the Nation Address (SONA) that the Department was going to be resourced.   They were not pre-empting the Review, because it says the same thing -- they were only strengthening it.   Reasons had been given for the shortfall -- the 2009 payment of soldiers with money that had not been budgeted.  The issue was that the Department needed to be put in a position where they could fulfil their responsibilities, and the present budget did not allow for that.  The Department needed to be better resourced

Mr M Mncwango (IFP) agreed with Mr Maynier that they could not at this stage use the Defence Review recommendations as justification to call for an increase in the DoD budget.   However, he was aware of the priorities and the responsibilities that the DoD must fulfil within the current financial year and in light of those responsibilities, it was important for the Committee to view the budget in the context of these responsibilities, which could not be avoided and required funding. Yesterday, they had spoken of some unfunded mandates that the Department had to carry out and had highlighted a lot of other issues.   One of them was personnel, which he agreed needed to be downsized, but that would also incur costs, because the DoD could not simply retrench people -- they would have to look at a programme for reskilling them.   This was why the Committee should look at the priorities of the Department and determine from that whether they could support an increase in the budget.

Mr J Skosana (ANC) said the report presented yesterday highlighted the constraints facing the Department, and there had been no objections from Members, only positive contributions.  Now, however, faced with the same report, there were additional queries. He though the Committee should adopt the report, since they were aware of all the constraints of the Department, and add on the recommendations they were now coming up with, because the Department could not be held back from addressing the challenges they faced.

Mr S Mncwabe (NFP) said the reason the government has state departments is for them to carry out the mandate to service the country. If they had a department which was unable to carry out its mandate owing to a lack of funds, it reverted back to them as a Committee and to Parliament to address the issue and help them carry out their mandate.   For that reason, he felt they should maybe adopt the report with the recommendations raised by the Members.

The Chairperson referred to Mr Maynier’s concern that the recommendation should be made straightforward -- whether the Department should be funded or not -- and from what the Members had said so far, it seemed as if they supported the view that the Department could not meet its priorities due to under-funding and should therefore be more resourced.

Mr Maynier said he did not think there was any disagreement among the Members of the Committee that members of the South African National Defence Force (SANDF) serving on the front line should be properly resourced in order to execute their missions and tasks. However, how that employment should be funded was a matter of contention.   On the one hand, it was argued the budget should be increased, but on the other hand there was the view that the Force’s employment funding must be financed from existing programmes within the budget because the Department had failed over the last decade to make the difficult decisions necessary in order to fund operations and capital acquisitions properly.

The Department had claimed, when making its presentation, the real problem was that in 1998 the Defence Review had assumed there would be a low level of commitment from the SANDF and in the next decade those commitments had escalated, and therefore the SANDF was under-funded.   Actually, in 1998 the Defence Review committee envisioned a very different Defence Force -- one with a small regular force and a large reserve force.  Currently the opposite was true, however, and it was because of this that the Department was spending more than 50% of their budget on personnel.   This meant that the Department must finally make the difficult decisions about what the tasks and missions of the Defence Force will be, and what the consequent SANDF design and structure will be.  Hopefully those decisions would be made during, and as a result of, the Defence Review.

The Department were now facing a conundrum.  They had a shortfall of R1.2 billion which they would have to finance from within the existing budget, and they would probably finance it from within the Special Defence Account.   The opportunity cost was going to be capital acquisition, and as a result of that the Department would not be able to execute their mandate properly.

The Chairperson said it was clear from the presentation that the Department was under-funded to the extent that it could not achieve its priorities, and the Committee therefore approved the budget with that understanding.   He asked if they could adopt the report with those amendments.

The Committee voted in favour of adopting the report, although there were objections, with the DA Members saying they reserved their position because it was a caucus issue.

The report was adopted with objections and amendments.

The meeting was adjourned.