The South African Parliament's public accounts committee has recommended an unprecedented multi-agency  forensic investigation after serious questions including corruption and conflicts of interest were raised about South Africa's strategic rearmament programme.

Leading business daily, Business Day reports that within two weeks Parliament's standing committee on public accounts will meet the Heath special anti-corruption investigating unit, the auditor-general, the public protector, the national prosecuting authority and the investigating directorate for serious economic offences to explore, with the agencies, how the investigation should proceed.

Business Day says the committee's report, released on Monday, raises serious concerns. These include undue influence in the awarding of some prime contracts, conflicts of interest among defence officials, the cost escalation potential of the contracts, which have already risen to R43,8bn, and the apparent ease with which contractors can withdraw from countertrade responsibilities with minimal penalties.

In addition to the forensic investigation, the committee will continue with its own investigations. It will meet Finance Minister Trevor Manuel and Parliament's finance committee to discuss the "ongoing assessment of the financial and economic fundamentals of the defence packages". The committee will also ask the Department of Trade and Industry to explain how it calculated that the industrial participation (offset) programme would create 65000 jobs, which the committee found 'optimistic'.

"In noting the complex and crosscutting nature of the areas to be investigated, the committee feels the investigation would be best served by combining a number of areas of investigative expertise and differing areas of legal competence and authority," the committee report said. Another area that needed probing was the 'non-costed' second option for fighter trainers, which "appeared to have led to the choice of a contractor who otherwise would not have been awarded the contract". This is a reference to the purchase of 24 Hawk lead-infighter trainers from BAE systems in two batches of 12.

Committee chairman Gavin Woods (a member of the Inkatha Freedom Party, which is in power with the African National Congress) said it was not within the ambit of the committee to decide when any of the contracts were at risk. The details of how this could happen were in the contracts. The ANC's Andrew Feinstein said that nothing had thus far led the committee to say that any of the contracts were under threat. But the investigation could lead to the review of the contracts.

With acknowledgement to Leon Engelbrecht and Defence Systems Daily.