Publication: Mail and Guardian Issued: Date: 2003-05-21 Reporter: Sapa

Arms Deal Report was "Heavily Edited"



Mail and Guardian

Date 2003-05-21



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The government's final report on the R60-billion arms procurement deal was heavily edited and it left out findings on gifts received by key players in the controversial deal, Business Day reported on Wednesday.

The final report, handed over to Parliament last year, also omitted "inaccuracies" in a defence department presentation to Parliament's select committee on public accounts (Scopa), the newspaper said.

It said this emerged in draft reports released last week to M2I2 (CI) managing director Richard Young, one of the losing bidders in South Africa's arms deal.

Young won a court action forcing Auditor General Shauket Fakie to give him documents relating to an investigation into the arms deal. Fakie, national Public prosecutions director Bulelani Ngcuka and Public Protector Selby Baqwa investigated the controversial arms procurement deal.

The newspaper said the differences between the draft documents and the final report provide support to a vociferous lobby that has complained that the report was significantly edited before it was published.

Fakie said on Tuesday that there were good reasons for not including some items in the final report. He denied that the changes were made at the behest of senior members of government, the newspaper said.

It said the final version omitted a section titled "inaccuracies in the presentation to Scopa", which lists three pages of differences between what was presented to Scopa and the factual situation as uncovered by investigators.

One of these "inaccuracies" reveal that the defence department's presentation, made in October 2002 and headed by former arms acquisition chief Chippy Shaik, claimed that a winning contractor, African Defence Systems (ADS), had no connection to French arms giant Thomson when the contract was awarded.

Shaik told Parliament that ADS - a company now partly owned by his brother Schabir - had no links to his brother at the time the contracts were submitted.

It was claimed that Schabir gained an interest in ADS only after Thomson - the South African subsidiary of which he is a director and shareholder - bought the company from Altech. But the draft reports state: "This is not correct. As was pointed out, Thomson International bought the first 50% of the shares of ADS on 24 April 1988."

Other "inaccuracies" relate to whether the M2I2 (CI) product, a combat suite for frigates, was a "nominated" or "preferred" bidder.

The draft states: "In the Scopa presentations, it is stated 'at no point in the entire tender process, did the SA Navy indicate a preference for the C2I2 IMS (information management system) product or technology, even though the SA Navy being (sic) a co-owner of the C2I2 IMS Technology'.

"It is the view of the investigation teams that the C2I2 IMS was the preferred databus of the SA Navy, at least up to a point."

The fact that this crucial finding was omitted from the final draft has infuriated Young, since it is apparently contrary to several earlier statements by Fakie that there were no substantial changes to the final report.

Young told Business Day he had instructed his legal team to formulate charges of perjury, contempt of court, defeating the ends of justice, and offences in terms of the Promotion of Access to Information Act against Fakie.

Fakie said he was not unduly pressured to remove any part of the report, nor was it improper to exclude from the final report what at first glance appear to be evidence of corruption.

The three short paragraphs in the gifts received section do not specifically conclude that prima facie evidence of corruption was found, Fakie said.

He said what was left out of the final, published report, was either insignificant or left our deliberately because it was under investigation by the elite crime busting unit - the Scorpions.

With acknowledgements to Sapa and the Mail and Guardian.