GROUNDED: Defence budget cuts have left the South African Air Force with no alternative but to put 12 of the arms deal’s 26 Gripen fighter planes into long-term storage.
Picture: Ambrose Peters

SWEDISH arms maker SAAB, which sold 26 Gripen fighter jets to South Africa as part of the notorious arms deal in 1998, will be hiring some of the 383 employees of state-owned arms company Denel who will be retrenched at the end of the month.

These retrenchments are expected to cost Denel, which was granted a government bail-out of R700m last year, at least R100m.

It is expected that some or all of the cost will be carried by the South African Air Force*1.

The staff, who worked at Denel Aviation, provided aircraft maintenance services to the air force under a decades-long contract, which was cancelled in November because of the air force’s own financial constraints.

At the same time, the budget cuts forced the air force to place 12 of the 26 Gripens ­ which were initially bought at a cost of R10bn ­ in long-term storage.

Willie van Eeden, a sector manager at trade union Uasa, which represents the staff, said: “It is clear that, due to another decrease in the defence budget, the South African Air Force had to take drastic action.

“But the point is, what is the use of an air force without serviceable aircraft, ready to fly at the beck and call of South African citizens? Having Gripen fighter planes and Hawk trainer aircraft at an original cost of billions being mothballed for long-term storage is obviously ridiculous*2,” said Mr van Eeden.

About 100 Denel employees, who work at air force bases across the country, have managed to find new jobs, including at SAAB, according to Mr van Eeden.

SAAB admitted in 2011 that a bribe of R24m was paid to secure the Gripen deal.

The union will be meeting with retrenched employees around the country during the first two weeks of April to help with job placement and training requirements, Mr van Eeden said.

Following protracted negotiations, the air force agreed to continue using the services of 139 employees, and is negotiating a new agreement with Denel.

Those employees who were retained will provide “vital maintenance services to the air force that form a cornerstone for continued airworthiness and the upkeep of air assets”, Denel said.

Although the budget constraints oblige the air force to mothball equipment, it is expected that the reduced staff complement will still be sufficient to service its planes.

The air force participates in peacekeeping missions, crime fighting, border protection, humanitarian aid and rescue operations. It also trains fighter pilots and provides transportation for government officials.

Siphiwe Dlamini, spokesman for the Department of Defence, said discussions between Denel and the air force were continuing.

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* This article was first published in Sunday Times: Business Times

With acknowledgement to Jana Marais and Business Day.

*1       It is expected that some or all of the cost will be carried by the South African taxpayers.


*2      Having Gripen fighter planes and Hawk trainer aircraft at an original cost of billions being mothballed for long-term storage is obviously ridiculous.

Ridiculous indeed.

Unless one had one's snout in this BAe/Saab trough.

Those trough feeders were prepared to waste R25 billion of their country's taxpayers hard-earned cash in order to skim R2,5 billion off the top.

And they in the main didn't even pay tax on that.

And what happened to the couple of hundred million Rand that we got for selling all of our excellent Cheetah C fighter jets to Ecuador?

Nelson, Thabo and Jacob split it three ways?