The Cape High Court yesterday rejected a bid by Economists Allied for Arms Reduction to block the government's participation in a multibillion-rand Airbus programme.

However, Judge Deon van Zyl did say the public were justifiably concerned at South Africa's spending on arms when housing, education and health services needed improvement.

"The public wants to know why huge amounts are being spent, what the need is for this expense when there are so many other needs to be addressed."

His decision came only a day before the deadline for government to sign a "declaration of intent" to take part in the design and manufacture of the giant military aircraft.

It also coincided with a call by DA leader Tony Leon for parliament to be recalled to debate what he called the "highly unorthodox and expensive arms deal".

"Government must not be allowed to spend taxpayers' money in a new arms deal which apparently has not followed standard procurement procedures, and has not been put out to tender and has not been considered by parliament," Leon said.

The government announced last week it had accepted an invitation from Airbus Military for South Africa to participate in the A400M multi-role mission transport aircraft design and manufacture programme.

In return, the government had committed to procure and take delivery of between eight and 14 aircraft for peacekeeping as the programme matured between 2010-2014.

Ecaar representative Terry Crawford-Browne had sought an order restraining the government from "signing and concluding supply contracts" for the aircraft.

He said the deal was "clearly economically irrational", as it did not address any plausible threat to South Africa, and did not meet the constitutional requirements for fair and cost-effective government procurement.

Although the deal was described as an "economic partnership programme", the arrangements clearly conformed to what were internationally known as offsets.

Offsets were banned by the World Trade Organisation because of their "distortionary effect", he said.

"They are a scam promoted by arms companies to promote the proliferation of weapons, particularly to Third World countries," he said.

However, secretary for defence January Masilela said in a replying affidavit that the government's main intention in the programme was not to acquire the aircraft but to participate in their design and manufacture.

Because the government was only about to sign a declaration of intent, a bid to interdict the signing of "supply contracts" was premature.

He said the programme did not have offsets because South Africa would not be the acquirer of weapons but the manufacturer.

Judge Van Zyl said Crawford-Browne and Ecaar had not made out a case that the government was acting irrationally.

Though the public had a right to be upset by spending on luxuries or unnecessary items when there were so many other needs to be addressed, Ecaar could not ask the court to decide on matters of national policy.

He found the request for an order against supply contracts was "totally premature", since the supply would take place only from 2010.

What the situation in South Africa would be then was total speculation, and the courts could not make decisions on the basis of speculation.

Crawford-Browne said afterwards he was "obviously disappointed" but he did not think he would appeal.

With acknowledgements to Ben Maclennan and the Cape Times.