An international non-governmental organisation asked the Cape High Court on Wednesday to torpedo the multibillion-rand arms deal on behalf of the "the poor people of South Africa".

In papers filed at court on Wednesday, the South African arm of Economists Allied for Arms Reduction (Ecaar-SA) asks the court to declare the arms package null and void.

It alleges that the government:

- Broke financial laws when entering into loan agreements.

- Acted irrationally and unconstitutionally in deciding to go ahead with the deal.

- Refused to heed the plight of poverty- stricken South Africans although this was required of it by the constitution.

Ecaar warned that the offset business promised as a sweetener for the deal could be nothing more than a "scam" by arms dealers.

Taxpayers would be left to foot the bill, which was likely to escalate "far beyond" the current estimate of R66-billion.

Projected costs of the deal in 2010, when the first repayments of foreign loans were to be made, were set at R151,2-billion.

A political economist at the University of Texas, Lloyd Dumas, said in a report filed with the papers that relying on the offsets, and believing they would not be cancelled or sharply reduced, was "an extremely risky business".

He said the arms deal failed the test of sound economics because it preferred the acquisition of arms to looking after the poor.

Ecaar-SA's chairperson, Terry Crawford-Browne, said in his affidavit: "The public was led to believe that this was a fantastic opportunity to fast-track South African industrial development through the acquisitions of armaments, and that the arms deal was both affordable and would benefit South African economically and financially."

The respondents cited in the application are President Thabo Mbeki, Finance Minister Trevor Manuel, the government, Speaker of Parliament Frene Ginwala, Public Protector Selby Baqwa, National Director of Public Prosecutions Bulelani Ngcuka and Auditor-General Shauket Fakie.

Crawford-Browne said all of them had been involved in some way with the arms deal.

Mbeki's claim that opposition to the arms deal was "racist" was both inappropriate and wrong.
Manuel is cited because he signed the foreign loan agreement and credit guarantees.

Ginwala is cited because "she holds documents pertaining to the arms deal to which members of public and even members of parliament have been denied access, in violation of the constitution".

This refers to an affordability study conducted by the Department of Finance and leaked to the media in May,

It said the arms deal posed enormous economic, fiscal and financial risks.

Baqwa, Ngcuka and Fakie are listed because of their "interest in the application and involvement with a report into allegations of corruption in respect of the arms deal". This report was released last week and cleared the government of any wrongdoing.

Summarising the history of the deal, Crawford-Browne said in 1996 the Department of Defence had published a white paper in which it was noted there "was no discernible foreign military threat" to the country and that issues of poverty demanded priority over military spending.

This paper has been attached to the court documents.

It had then been decided to conduct a defence review, which was done in 1998, and culminated in a "defence in a democracy" document.

Crawford-Browne said: "This document contained a number of options, which can more properly be described as a wish list." Parliament had not approved or implemented any part of this document or authorised any loans for an arms deal, he said.

"In November 1998, the Department of Defence, however, announced a list of preferred suppliers of armaments and equipment and made clear its intention to proceed to purchase armaments at a cost of approximately R29,8 billion."

This deal involved the purchase of frigates and submarines from Germany, Gripen fighter aircraft from Sweden, Hawk fighter trainer aircraft from the United Kingdom and utility helicopters from Italy.

"Various non-governmental organisations, churches and members of civil society raised the fact that such expenditure could not be justified in the light of the fact that South Africa had no discernible enemies.

"We stated that a clear priority was poverty alleviation.

"The government's response was to inform the public that the envisaged expenditure of R29,8-billion would be offset by foreign investment and exports of R110-billion (which was later reduced to R104-billion) and that these offsets would create 64 165 jobs."

Crawford-Browne said if Manuel took the warnings of the affordability investigators into account, he could not rationally enter into the arms deal.

Manuel had failed to comply with the Exchequer Audit Act and the Public Finance Management Act.

Crawford-Browne said he was turning to the court for help "on behalf of the poor people of South Africa".
"The arms deal has been mired in controversy because of allegations involving fraud, dishonesty and corruption involving many role players."

Since the deal was concluded, its estimated cost had risen to R66-billion because of the fall of the rand against foreign currencies. The contracts are denominated in foreign currencies.

"The arms deal infringes (poor people's) right to adequate housing, health care, food, water and social security and education."

With acknowledgement to The Cape Argus and Independent Online.