CAPE TOWN 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 SA's R30bn arms acquisition package.

Within two weeks Parliament's public accounts standing committee will hold a meeting with the Heath special 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 can proceed.

The committee's report, which was released after its meeting yesterday and will soon be tabled in the National Assembly, 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 multisectoral 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 trade and industry committee to explain how it calculated that the industrial participation 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 "noncosted" 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". Committee chairman Gavin Woods (Inkatha Freedom Party) 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 African National Congress's Andrew Feinstein said that nothing led the committee to say at this stage that any of the contracts were under threat. However, the investigation could lead to the review of contracts. 

With acknowledgement to Wyndham Hartley and Business Day.