On Wednesday, the cabinet defended its R30-billion arms procurement package, which has come in for increasing criticism, saying it was satisfied with the integrity and structure of the deal.

It also defended last week's controversial salary increases for members of parliament, under which senior cabinet ministers and parliamentary office-bearers will receive increases of up to 15,5 percent.

Military top brass and officials involved in the arms deal were recently grilled on details of the package in a marathon session of parliament's standing committee on public accounts.

The Industrial Defence Procurement Package (IDP) deal was signed in December last year with countries including Germany, Italy, Sweden, Britain and France to buy corvettes, submarines, light utility helicopters, fighter trainers and advanced light fighter aircraft.

In April, costs had escalated to R43,9-billion. In a series of tough questions, MPs on the standing committee demanded an explanation for the soaring costs in the deal, initially pegged at R30,3-billion.

The committee heard that by April this year, costs had escalated to R43,8-billion and that this figure took into account inflation and projected foreign exchange rates, but not finance costs.

There was a suggestion that the package, which was staggered over 15 years, could cost R60-billion or more in the end.

The cabinet said it had discussed recent media reports which cast aspersions on the integrity and rigour of the IDP.

"The government wishes to clarify that the package, as a whole, included comprehensive agreements with financial institutions, pertaining to, among other things, an appropriate hedge mechanism to prevent escalation of prices in the instance of unforeseen inflation and exchange-rate movements."

'The average salary increase amounts to 7,5 percent' On reviewing the medium-term budget policy framework, which will be presented to parliament next week, the cabinet noted there would be no budget risks arising from the IDP process.

The government also agreed that the cabinet ministers involved in the deal "would avail themselves" to the standing committee on public accounts to discuss the issues. The government also would co-operate with any investigations that might be set up on the matter.

Regarding the salary increases, the government's communication and information system chief, Joel Netshitenzhe, said the cabinet had noted the public debate over salary increases for ministers, but reiterated that the increments amounted to 7,5 percent on average.

"Sensational reports" had focused on the higher end of the increments which were 15 percent for 24 office-bearers.

"While sensational reports have focused on the upper end of the scale, the reality is that the average increments amount to 7,5 percent and these include the introduction of notches, taking into account length of service, as well as housing allowances," Netshitenzhe said.

The cabinet said it was appropriate that salary increases should be handled by an independent commission, headed by Judge Richard Goldstone.

Regarding the public outcry over the increases, the cabinet said in a statement the public was welcome to debate the matter and, where necessary, make submissions to the independent commission.

The new remuneration packages of all national political office bearers included a provision for additional spending on housing caused by South Africa's two-capital system and was designed to help maintain two, and in some cases, three houses, he said.

With acknowledgement to Andre Koopman and the Cape Times.