Piet Erasmus completely, perhaps intentionally, misrepresents me (Letters, May 7) in suggesting that, in opposing the arms deal, I am opposed to the technological upliftment of SA's economy.

A first step in upgrading our technology, however, is educating the future labour force, a matter deliberately neglected during the apartheid era with predictably disastrous economic consequences.

Defence expenditure in the 2002-03 budget rose by 15%, while education expenditure rose by only 7%. Shouldn't we get our priorities right?

The corruption allegations are "sexy" and have rightly grabbed public attention. But that is not the only, let alone prime, reason to cancel the arms deal. The squandering of public finances was predicated upon the economic absurdity that expenditure of R30bn on warships and warplanes would generate R110bn in offsets to create 64165 jobs.

The finance department warned the cabinet that foreign exchange and other risks were considerable, and that there was no means of hedging those risks. Undaunted, Finance Minister Trevor Manuel recklessly proceeded to sign the contracts that gave effect to the arms deal. Even he now admits that the costs have already escalated from R30bn to R52,7bn, plus the finance costs.

The flagship offset for three submarines was to be a $1bn stainless steel plant at Coega. The Saldanha Steel debacle notwithstanding, the proposal hinged on massively subsidised electricity and water. Even these subsidies were inadequate to overcome the fact that the world steel market is glutted and depressed. Thus Coega has been downscaled to an automated condom factory in East London.

Erasmus reveals himself as being locked into 1960s' mentality that the armaments industry is the cutting edge of technology. Spin-ons have replaced spin-offs! The idea that armaments can be economically beneficial to SA simply doesn't hold up.

We have been down that road during the apartheid era with disastrous consequences when tens of billions spent on armaments bankrupted the country.

It is a lesson that Armscor and the trade and industry department still have not learned.

The reality of the 21st century is that the scrap industries are steel, chemicals, refineries, armaments and paper.

With acknowledgements to Terry Crawford-Browne and Business Day.