Publication: Issued: Pretoria Date: 2001-08-28 Reporter: Sapa Editor:

Disgruntled Contractor Stoked Wrongdoing Claims in Arms Deal


Issued  Pretoria
Date 2001-08-28
Reporter Sapa


The personal beliefs of a disgruntled defence contractor partly sparked the allegations of wrongdoing in South Africa's strategic arms package, the public hearings into the deal revealed on Tuesday.

This emerged while the contractor, Richard Young, was being questioned about his view that the product of a competitor who beat him to a tender was inferior.

"So, it is your beliefs that have sparked all these allegations?" asked Michael Kuper, for the Department of Defence.

Young responded: "To a certain extent, yes."

Kuper earlier remarked: "That highly self-interested perspective of yours explains much of the problem."

He also suggested that Young had deliberately sought to discredit the country's arms procurement process through the media after he lost the contract.

Young is the managing-director of Communications Computer Intelligence Integration Systems (CCII), a Cape Town-based defence information technology company.

He contends there were irregularities in the awarding of a R40-million tender for information management systems (IMS) used in the four corvette ships South Africa bought under the arms package.

CCII was named the preferred supplier of these systems, Young claims. The tender was, however, awarded to French company Detexis.

Detexis is the sister company of African Defence Systems (ADS), of which arms acquisition head Chippy Shaik's brother, Schabir, is a shareholder and director.

Kuper on Tuesday asked Young why he had quoted selectively from a classified technical evaluation report on the Detexis product.

In his testimony on Monday, Young reproduced extracts from the report, listing the negative aspects of the Detexis system.

Kuper on Tuesday pointed out that this list was preceded by a paragraph stating that the Detexis product met the necessary requirements.

Asked why this conclusion was omitted from his testimony, Young said: "I think that statement is completely wrong."

Kuper described the paragraph concerned as the most important aspect of the report, asking: "What about candour, honesty, and bona fides in dealing with a document in a way that reflects its contents?"

When Young maintained that the Detexis system was not up to standard, Kuper pointed that it was being used in a sophisticated destroyer vessel of the British Royal Navy.

"And this is one of the most advanced combat ships in the world," Kuper said.

Young replied that political reasons were behind the decision by the British to opt for the Detexis system.

Young was also queried about an undertaking in his testimony to supply classified documents he referred to if asked to do so.

"Do you have all the documents?" Kuper asked.

Young replied: "I don't have all of them any longer. Some were in digital form and have been deleted."

Questioning Young about his criticism in the media on the procurement process, Kuper said: "You deliberately sought media exposure."

Young responded: "That is not entirely true. I was approached by hundreds of people in the press, of whom I turned away about 80 percent."

He, however, confirmed, that he made use of the opportunity to air his grievances, adding: "Taking your story to the press is the last resort in any democracy."

Kuper observed that Young had since August 1999 done nothing to take his case to court. Asked whether he still intended resorting to legal action, Young refused to answer.

He said he had all the time been hoping for a reinstatement of the contract that he lost.

In the morning, Young disputed evidence that Shaik had avoided conflict of interest situations in the procurement process.

He cited a senior Armscor official who he said had "described Mr Shaik's supposed recusal as a farce".

Young rejected earlier evidence by retired navy chief Vice-Admiral Robert Simpson-Anderson that Shaik recused himself from meetings where his conflict of interest was relevant.

"I was told by Mr Kevin Hanafey, senior manager of Armscor's maritime division, that on certain occasions Mr Shaik merely handed over the chairmanship of the meeting to someone else. He then remained present and took part in the discussions and decision making."

Hanafey was the one who described the claims on Shaik's recusal as a farce, Young said.

He cited the minutes of meetings as further proof of Shaik's presence during crucial discussions.

Kuper questioned Young's testimony of the past two days, suggesting it was rife with innuendo.

"Do you really think this is a balanced and proper attack," he asked Young.

Young replied that it was inappropriate to construe his testimony as an attack, saying he had been invited to testify.

He added: "This testimony was very carefully reviewed. We have been exceedingly careful to stick to the facts and to identify opinions as such where they are expressed."

Starting his cross-examination, Kuper observed that there had been hundreds of bidders in the arms package as a whole. There had been no litigation by any of those who lost out.

The only complaint came from Young, Kuper said. Young said he knew of another company which was unhappy.

Young later testified that Simpson-Anderson took the final decision in favour of the Detexis system.

Concluding his cross-examination, Kuper remarked that Young's company had won contracts worth R23-million from Armscor "during your huge campaign at all levels".

"So, during this period, you have not been left out in the cold," Kuper said.

The hearings continue on Wednesday.

With acknowledgements to Sapa.