Department of Defence Annual Report FY2010/11

1. Department of Defence Annual Report FY2010/11 Presentation to the PCD&MV 18 October 2011 RESTRICTED

2. Aim To present an Achievements of the Department of Defence (DOD) Annual Report FY2010/11

3. Scope • Achievements • Defence Outcome and Outputs • DOD Annual Report Structure • DOD Appropriation Statement • Programmes and Subprogrammes • Achievements and Challenges • Selected performance indicators • Enterprise Risk and Mitigation Strategies • Questions and Discussion

4. Achievements • The Department of Defence (DOD) Annual Report FY2010/11 accounts for the performance against the approved DOD Strategic Plan for the period 01 April 2010 to 31 March 2011. • The DOD derives its mandate primarily from Section 200(2) of the Constitution of the Republic of South Africa, 1996 (Act 108 of 1996). This mandate is given substance by the Defence Act, 2002 (Act 42 of 2002), the White Paper on Defence (1996), the Defence Review (1998) and delegated legislation. • The outcome of Defence has been fully aligned with government policy on defence and enhances national, regional and global security goals through the existence of combat-ready deployable defence capabilities. • The DOD comprises of the SANDF and Def Sec which are established in terms of Section 202 and 204 respectively of the Constitution and the Defence Act 2002 (Act 42 of 2002).

5. Defence Outcomes and Outputs • Defence Outcome • Effective defence for a democratic South Africa • Defence Outputs • The provision of defence capabilities that can respond to the needs of South Africa within the evolving policy and national priority trajectory that characterise a developmental state • Landward defence capabilities • Air defence capabilities • Maritime defence capabilities • Military health support capabilities • Defence commitments, which include: • operations that are ongoing in nature, and for which plans and financial provision can be made in advance; • operations that must be executed during the year and, if unforeseeable, for which no provision has been made; and • Joint interdepartmental and multinational exercises required to prepare forces for operations.

6. Defence Outcomes and Outputs (cont) • Defence Outputs (Cont) • Defence diplomacy, which includes: • the deployment of Defence Attachés; • the servicing of defence-related Memoranda of Understanding (MOUs); and • participation in the defence structures of the UN, AU and SADC. • The provision of Defence-related policy and Ministerial advice • Cryptographic security services for Government departments • The National Codification Bureau • The provision of appropriate framework for sound policy, direction and advice and the systemic monitoring and evaluation thereof

7. Annual Report Structure • Foreword by the Minister Part 1: Information on the Ministry • Chapter 1: The Ministry • Strategic Achievements by the Sec Def Part 2: Strategic Direction and Defence Objectives • Chapter 2: Strategic Direction Part 3: Programme Performance • Chapter 3: The Defence Vote • Chapter 4: Administration • Chapter 5: Force Employment • Chapter 6: Landward Defence

8. Annual Report Structure (Cont) • Chapter 7: Air Defence • Chapter 8: Maritime Defence • Chapter 9: Military Health Support • Chapter 10: Defence Intelligence • Chapter 11: General Support Part 4: Organisational Structure and Human Resources • Chapter 12: Organisational Structure & Human Resources • Appendices Part 5: Financial Performance Part 6: The Department of Military Veterans – separate document

9. DOD Appropriation StatementFY2010/11

10. Appropriation Statement for the year ended 31 March 2011 Programme Adjusted Actual Total Virements Final Approp Variance Appropriation Expenditure R'000 R'000 R'000 R'000 R'000 Administration 3,417,210 35,705 3,452,916 3,452,916 - 1 Landward Defence 9,009,567 286,001 9,295,568 9,295,568 - 2 Air Defence 5,536,418 -47,482 5,488,936 5,488,936 - 3 Maritime Defence 2,358,300 -8,384 2,349,916 2,349,916 - 4 Military Health Support 3,049,570 100,764 3,150,334 3,150,114 220 5 Defence Intelligence 656,612 -22,759 633,853 633,853 - 6 General Support 4,132,717 -327,106 3,805,612 3,805,612 - 7 Force Employment 2,282,197 -16,741 2,265,457 2,265,457 - 8 TOTAL 30,442,591 0 30,442,591 30,442,371 220 • Note: • 99% of the Defence budget was spent. • Provision made in the Actual Expenditure is an amount of Rm128,4 for the partial write-off of unauthorised expenditure of previous FY's. • Rm0,220 under expenditure is a transfer payment not utilised.

11. Appropriation Statement for the year ended 31 March 2011 Actual Final Appropriation Economic classification Variance Expenditure R'000 R'000 R'000 30,442,591 30,442,371 220 Current payments 25,654,799 25,654,799 - Compensation of employees 16,597,098 16,597,098 - Goods and services 8,890,703 8,890,703 - Transfers & subsidies 3,888,238 3,888,018 220 Departmental agencies & accounts 3,024,728 3,024,728 - Public corporations & private enterprises 737,510 737,510 - Non-profit institutions 5,407 5,187 220 Households 120,592 120,592 - Payment for capital assets 899,554 899,554 - Buildings & other fixed structures 251,203 251,203 - Machinery & equipment 581,388 581,388 - Biological or cultivated assets 71 71 - Software & other intangible assets 132 132 - Specialised Military Assets 66,760 66,760 -

12. Programme 1: Administration: Subprogrammes Ministry Departmental Direction Secretary for Defence Government Information Technology Officer (GITO) Policy and Planning Defence Policy, Strategy and Planning (DPSP) Military Policy, Strategy and Planning (MPSP) Corporate Staff Office Financial Services Human Resource Support Services Legal Services Inspection Services

13. Administration: Subprogrammes (cont) Acquisition Services Defence Matériel Defence Supply Chain Integration Communication Services SANDF Command and Control Religious Services Defence Reserve Direction Defence Foreign Relations Chief of Defence International Affairs Chief of Defence Foreign Relations

14. Subprogramme: Ministry Achievements • MOD&MV focussed on the DOD contribution to; • peace and security in the region, continent and internationally through bilateral and multilateral engagement and SANDF deployments. • internal deployment of the SANDF in support of other Government Departments, 2010 FIFA Soccer World Cup, xenophobia, strikes etc. • preparedness of the SANDF to effectively undertake the function of Border Safeguarding. • the establishment of the Department of Military Veterans. • Focussed on a clean audit. • Enhanced good working relations with Parliamentary committees such as the PCD and SCOPA.

15. Achievements (cont) Ensured promulgation of the Defence Amendment Act 22 of 2010 and Military Veterans Bill. These brought resolution to inter alia; the obligation to serve for the Reserve Force, the establishment of a permanent DFSC, and the costing of the Military Veterans’ benefits. Directed the following, inter alia; the Review of Defence Policy, the repositioning of the Defence Secretariat, the National Youth Service (NYS) programme, and the repositioning of the Defence Industry. Subprogramme: Ministry (cont)

16. Achievements Participated in defence diplomacy bilateral and multilateral engagements . Ensured effective participation in the Cluster engagements, in particular the ICTS and JCPS as well as other Clusters. Ensured adherence to financial prescripts and national planning prescripts enhanced governance and compliance. Ensured the functioning of the Department of Military Veterans by providing expert support. Obtained Cabinet approval for the NSF Pensions as contemplated in the Bill. Subprogramme: Departmental Direction (Sec Def) CONFIDENTIAL

17. Subprogramme: Departmental Direction (Sec Def) (cont) Achievements (cont) • Worked towards ensuring a reduction of audit qualifications with a special focus on the remaining asset management qualification (Op Clean Audit). • Ensured the successful separation and the tabling of the DOD Strategic Plan and APPs for 2012 for the Secretariat and SANDF. • Contributed to Government initiatives on job creation with 5700 job opportunities created within the MSDS programme. • Developed options in consultation with stakeholders for the repositioning of the Defence Secretariat and the Defence Industry. • Ensured approval of the Military Ombudsman Bill during November 2010. • The MOUs for the two peace support missions (DRC and Sudan) and three General Military Assistance missions (DRC - Op TEUTONIC, CAR - Op VIMBEZELA, Mozambique - Op COPPER) were concluded.

18. Subprogramme: Departmental Direction (GITO) Achievements Promulgated the Defence Information Strategy and the ICS Policy. The Information Strategy control plan was developed to improve the effectiveness and interoperability of the Information Systems of the DOD. The following standards, principles and guidelines were developed to enhance interoperability external to the DOD: Defence Information and Communication System Standards on Public Key Infrastructure and De-Militarised Zone (DMZ). Defence Data and Information Standard for Data warehouse. Strategic Study on the use of Virtualisation Technologies. Discussions are underway for the lifting of the moratorium on the development of the DOD’s unique logistics systems . Continued oversight of the integration of DOD ICT Systems. CONFIDENTIAL

19. Subprogramme: Departmental Direction (GITO) Challenges Current DOD ICT inventory is not integrated and has a high level of obsolescence. Lack of Financial Resources for a big bang approach in IT Systems Renewal. Lack of critical ICT Skills in the department and within the Service Providers (e.g. SITA). CONFIDENTIAL

20. Subprogramme: Policy and Planning (DPSP) Achievements Ensured that Policy, Strategic Planning, and Reporting were done according to governing prescripts. Developed the Strategic Planning Framework (SPF) for the development of the Strategic and Annual Performance Plans. Successfully separated the DOD plans into separate plans for the SANDF and the Def Sec and tabled in March 2011 respectively. Coordinated DOD inputs and participation in the Cluster engagements, in particular, ICTS and JCPS Clusters. Developed the Enterprise Risk Management (ERM) Framework for the DOD. CONFIDENTIAL

21. Subprogramme: Policy and Planning (DPSP) Achievements (cont) Provided secretarial services to the National Conventional Arms Control Committee (NCACC) and its subcommittees. 6 587 permits were issued. Consulted with the Presidency on the drafting and provision of deployment authorisation papers. Developed the Defence Strategy Conceptual Framework which has been handed to DRC for further work. Played a critical role in the development of inter alia; the NYS programme, the Maritime Strategy, the policy on the Military Ombud, and the Dept Mil Vet strategic plans. CONFIDENTIAL

22. Subprogramme: Policy and Planning (DPSP) (cont) Achievements (cont) Promulgated the Business Process Management DODI that enhances integrated management systems in the DOD. Challenges Human resources capacity constraints. Filling of vacant posts and the utilization of the Reserves. CONFIDENTIAL

23. Subprogramme: Policy and Planning (MPSP) Achievements • Developed the Commanders Appreciation and Guidelines, the SANDF Strategic Plan and Annual Performance Plan (new format). • Defined the SANDF Readiness Index Model User Requirement and produced the preliminary Readiness Index Strategy. • Developed the DOD environmental analysis. • Coordinated the development of DOD rectification plans in response to the findings of the Interim National Defence Force Service Commission. • Coordinated and drafted the Budgetary Task Team investigation and report on efficiency and effectiveness in the DOD. • Coordinated the SANDF planning in response to the MOD&MV priorities.

24. Subprogramme: Corporate Staff Office Achievements • Management of Specialist Advisory Team (Team BULISA) in the DRC. • Performance management of the Reserve Force Council. • Command and control of DOD HQ unit supporting services. • Chief Corporate Staff attended three bilateral and multilateral Defence Committee Meetings.

25. Subprogramme: Financial Services Achievements Worked towards ensuring that the DOD complies with the set financial deliverables Focused on the continuous improvement of financial management services in order to reduce audit qualifications. Focused on refining departmental processes, systems and policies with a view to aligning them with the Public Finance Management Act (PFMA) regulatory framework. Ensured that 99% of the Defence budget was spent and focussed on improving revenue management by enhancing existing policies and procedures. Challenges Migration from outdated FMS to IFMS. High staff turnover. CONFIDENTIAL

26. Subprogramme Human Resource Support Services Achievements Hosted the annual DOD Gender Conference and reported on the progress made in implementing the Gender Mainstreaming Action Plan. Research findings on the status of women in the DOD sixteen years into Democracy was reflected upon. The revised Non-Statutory Forces (NSF) Pension Dispensation was approved by Cabinet. It makes provision for the 100% recognition of the service period of former NSF members without a requirement to contribute 5%. Joint task team is implementing the roll-out of the Pension Restructuring Project. Supported the Interim National Defence Force Service Commission (INDFSC) and crafted a programme of action on the following activities: Support to the process of finalising permanent organisational structure for the DFSC Final report presented to the MOD & MV and to the JSCD. Visited the external deployments to further evaluate and gather information from deployed members regarding remuneration and conditions of service on deployment. Currently supporting the finalisation of the draft Defence Force Service Commission Regulations. CONFIDENTIAL

27. Subprogramme: Human Resource Support Services (cont) Challenges Performance Agreement and Financial Disclosures – Non Compliance with the policy. The challenge with non-adherence to policy with signing of performance agreements and submitting financial disclosures will be addressed as follows: An instruction to SMS members informing them of the due date for the submission of Performance Agreements and Financial Disclosures will be sent each year on 31 January. Presentation will be made to top management in early March each year. Introduction of SMS communication system to remind top management will be implemented with effect from 30 November 2011. Enforcement of Financial Disclosures for people outside the SMS system. In order to address this challenge, the DOD is developing a policy which will force all members of the DOD to declare their financial conflict of interest. The policy will be finalised by 31 December 2011.

28. Subprogramme: Human Resource Support Services (cont) Challenges (Cont) Employees who perform remunerative work outside the DOD without authorisation. The challenge with employees performing remunerative work outside the DOD will be addressed as follows: A database of all employees performing remunerative work outside the DOD has been established and will be maintained on the PERSOL system. A policy on remunerative work outside the DOD is currently under review to address delegation of authority for authorising work outside the DOD. Infrastructure shortcomings. Owing to serious infrastructure shortcomings at Personnel Services School accreditation as a training facility could not be obtained and the accredited curricula for the training of Human Resource Practitioners could not be implemented.

29. Subprogramme: Legal Services Achievements • Provided law support and legal advice for external and internal operations, exercises, ad hoc deployments/investigations, operational law training lectures and refresher law training sessions. • Military law support and legal advice rendered with the drafting of 17 bilateral and multilateral Memoranda of Understanding. • Attended to 1 305 of 1 312 requests for legal advice. • Court of Military Appeals finalised 42 cases that were set down for hearing. • Military Prosecution received 29 dockets and five internal Boards of Inquiry. • Defence Amendment Billassented to by the President on 09 Dec 10. • School for Military Justice received full accreditation from the SA Qualification Authority as a service provider for three subjects. Challenges • Serious decline in the allocated operating budget due to the expansion of the human resources budget. • Lack of posts in operations environment. • Shortage of trained Military Law Practitioners.

30. Subprogramme: Inspection Services Achievements • Established a nodal point for the Fraud and Corruption Forum. • Finalised the Fraud Prevention Plan. • Retained certification of ISO 9001: 2008 (Quality Management certification). • SADC Seminar was hosted in Cape Town where the Division presented a draft Inspection Manual. • All Commando Units and Group Headquarters were successfully closed and de-activated (except for four in process) from the system.

31. Subprogramme: Acquisition Services (Defence Matériel) Achievements Focus for the year was firstly to finalise the SDPs and secondly to acquire new equipment and upgrade old equipment in accordance with the priorities. Some of the equipment and systems acquired played an integral part in the support to the successful 2010 FIFA World Cup tournament. Technology development support to Chemical Defence ensured that adequate decontamination support measures were in place for the 2010 FIFA World Cup event. Similarly, some of the acquired / upgraded systems will play an integral role in border safeguarding (Op CORONA). Continued to support the Sec Def and the MOD with effective governance of capital acquisitions. CONFIDENTIAL

32. Subprogramme: Acquisition Services (Defence Matériel) (cont) Project-related Achievements • Landward Defence Acquisition.The acquisition of the 60 mm long range mortar for the SA Army has been completed and this weapon system will be commissioned in FY2011/12. • Air Defence Acquisition. A further 4 single seat Saab Gripen Advanced Light Fighters were delivered. • Naval Acquisition. Both the SA Navy’s Strategic Defence Package programmes (4 Meko 200 Frigates and 3 Class 209 Type 1400 Submarines) have entered the closing phase. • Defence technology. Development into high energy lasers and their application has produced world first outcomes. In addition the progress with the integrated maritime picture will enhance anti-piracy and anti-poaching patrols.

33. Subprogramme: Acquisition Services (Defence Matériel) (cont) Challenges Acquisition approval process is cumbersome and needs refinement. This is in process. Underperformance within the defence industry remains complex and a challenge with respect to timeous delivery. Lack of an asset register for intangible capital assets (Intellectual Property). An intangible capital asset register has been established and under configuration. Lack of policies, procedures and project plans on intangible capital assets. The policy on intangible capital assets is currently in a draft format and is due for completion by end of 2011 financial year.

34. Subprogramme: Acquisition Services (Defence Supply Chain integration) Achievements • Successfully hosted the 2011 Defence Industry Day to further enhance and promote DOD relationships in support of local Industry. Defence Industry Day is fast transforming into a national event enjoying widespread attendance by government departments. • Supported DOD joint operations by concluding contracts in support of forces deployed on missions. Contracts included: • Termination of accommodation contract for Ops SADAIT team. • Contract for medical air evacuation of DOD members who may need medical attention. • Contract for accommodation of Ops VIMBEZELA members. • Customised the National Treasury Instruction (issued Sept 2010) in line with DOD supply chain procedures that dealt with amended guidelines regarding the use of functionality as a criterion for evaluation of bids.

35. Subprogramme: Acquisition Services (Defence Supply Chain integration) (cont) Challenges • The alignment of Supply Chain Integration Business processes and governance prescripts have highlighted certain structural defects and capacity constraints. This is being addressed through a scientific analysis and evaluation. • Lack of capacity to review, revise and incorporate the latest Supply Chain Management (SCM) legislation into DOD policies to ensure materiel compliance. A DOD work group is currently revising the DOD procurement policy. This task is scheduled for completion by Dec 2011. The workgroup is being capacitated by utilising Reserve Force members and appointing interns.

36. Subprogramme: Acquisition Services (Defence Supply Chain integration) (cont) Challenges The AG findings on SCM (procurement and contract management) matters dealt with: Goods and services >R500 000 not procured by means of a competitive bidding process in accordance with TR16A6.4. The current DOD procurement policy is being amended to ensure that all requirements >R500 000 are advertised in the Government Tender Bulletin. Only in exceptional cases will TR16A6.4 be utilised and approval will be granted by the Accounting Officer. Awards were made to suppliers who did not declare their employment by the state or their connection with a person employed by the state. All DOD procurement entities now utilise the new revised National Treasury SBD 4 “Declaration of Interest” form as a mandatory document when soliciting proposals from bidders. This will compel bidders to disclose all interests and relationships. Instances were identified where senior managers did not disclose their business interests in a supplier to the department and to the executive authority. HR acknowledges this finding. All disclosures have been obtained and is with the Executive Authority for signature. HR will also make the list of those members with interests available to the procurement entities so that the database can be updated.

37. Subprogramme: Acquisition Services (Defence Supply Chain integration) (cont) Challenges The AG findings on SCM (procurement and contract management) matters dealt with (cont): In some instances SCM officials and/or other SCM role players and those whose close family members had business interests in contracts awarded by the department failed to disclose their interests and in some instances participated in the process relating to the award. In order to address this challenge, the DOD is developing a policy which will force all members of the DOD to declare their financial conflict of interest. The policy will be finalised by 31 December 2011. All SCM officials involved in procurement will also be forced to sign the Code of Conduct for SCM officials which requires them to remove themselves from processes in which they have a conflict of interest. Some employees performed remunerative work outside their employment in the department without written permission from the relevant authority as per the Public Service Act and DOD Instruction PERS No 4/99 dated 22 December 1999. HR acknowledges this finding. HR is correcting this by firstly reviewing the policy to ensure that authority for remunerative work is only approved by the Chief of Service. Chiefs will also compile a database of all employees granted authority and this will be elevated to the C SANDF for his members, Sec Def for other employees and this will eventually be given to the Minister. This will also be captured on PERSOL and a control code will be allocated.

38. Subprogramme: Communication Services Achievements • Defence TV won the first prize and received the coveted Chief of Staff of the Italian Defence Force Award,an international film award, for “Cheetah farewell”. • Continued to enhance the good working relationships with the media houses. • Communication strategy developed.

39. Subprogramme: SANDF Command and Control Achievements • Two Peace Support Operations (PSOs) were conducted under the signed Memoranda of Understanding (MOUs) in the DRC and Sudan. • Three General Military Assistance Operations were conducted under the signed MOU with the DRC - Op TEUTONIC, CAR - Op VIMBEZELA, Mozambique - Op COPPER. • Three internal operations were conducted. (CORONA, KGWELE and BATAII) • Advanced relations with foreign countries and Multilateral organisations (AU/SADC). • Monthly participation in the Clusters and FOSAD. • Relevant and timeous military advice to the MOD&MV.

40. Subprogramme: Religious Services Achievements • Ten Chaplains deployed externally in all DOD deployment missions and both Regular and Reserve chaplains deployed on the border. • Assistance provided to Mozambique, Lesotho and Namibia Defence Forces to establish own Chaplain Services. • Support to Marion Island, Gough Island and SANAE base research missions by three chaplains. • 29 Reserve chaplains trained.

41. Subprogramme: Defence Reserves Direction Achievements • Six Defence Provincial Liaison Councils have been established. • Several tertiary institutions engaged to give effect to the roll-out of the University Reserve Training Programme (URTP). • Strength of the Reserves increased to 26 147 from 22 062 in FY2009/10. • Reserves deployed in peace support operations, border safeguarding and other internal operations. Challenges • MSDS still does not provide a sufficient feeder system for Reserves. • Limited continuation training budget.

42. Subprogramme: Defence Foreign Relations(Chief of Defence International Affairs) Achievements Drafted, negotiated and facilitated four Defence agreements with other States and International Organizations. Supported the development of the South African International Relations Policy with DIRCO. Facilitated the processing and signing of the Defence Co-operation agreements/MOUs with various countries Provided strategic and policy guidance to Defence Foreign Relations towards achieving all diplomatic obligations in terms of existing defence cooperation agreements. CONFIDENTIAL

43. Subprogramme: Defence Foreign Relations (Chief of Defence Foreign Relations) Achievements • New office opened in Cuba and Non-residential accreditation to Ghana approved . • Facilitated Defence Committee Meetings with Germany, PRC, USA and UK • Facilitated Bilateral Joint Permanent Commissions with Namibia, Botswana and Zimbabwe • Facilitated attendance of the MOD & MV and a representative of C SANDF at the 6th Meeting of the African Chiefs of Defence Staff and Heads of Security in Addis Ababa. • Coordinated the Foreign Visitors' Programme during AAD for inter alia 17 Ministers of Defence, Chiefs of 7 Armies, 28 Air Forces, 7 Navies and 2 Surgeons General. • The DA offices in Ethiopia, Vietnam, Kenya and the DRC evaluated. • 1 346 members of the DOD and Foreign Delegations made use of the VIP Lounge at OR Tambo International Airport. Challenge • The DFR structure and budget are still not aligned to its mandate since the purpose of the organisation changed to a departmental service organisation in 2001.

44. PROGRAMME 2: FORCE EMPLOYMENT Achievements • The J Ops Division complied with all Regional Security requirements by successfully executing two Peace Support Operations and three General Military Assistance Operations. • In the Support to the People, all requests for border safeguarding and operations in cooperation with the SAPS were complied with. • Deployed on the borders in Limpopo, Mpumalanga and Kwa-Zulu Natal. • 2010 FIFA World Cup • Public service strike • Xenophobia incidents • Voter registration • Op DUTY CALLS during festive season. • Opening of Parliament

45. PROGRAMME 2: FORCE EMPLOYMENT (cont) Achievements (cont) • Aid and disaster relief provided through the building of two bridges by the SA Army. • Fire fighting, search and rescue operations at sea and on land. • Support during the floods in the Northern Cape. • Six Joint, Interdepartmental and Multinational (JIM) Exercises were planned, co-ordinated and directed. Challenges • Lack of a Strategic Lift Capability. • Land claims on the Madimbo training area remain unresolved.

46. PROGRAMME 3: LANDWARD DEFENCE Achievements • All requirements for external and internal deployments complied with: • UN and AU Missions in Africa. • Internal operations eg Border Protection, provided forces for 2010 FIFA World Cup and support to public service strikes. • Post conflict training (DRC/Ivory Coast). • Reserve and MSDS members utilized for both internal and external deployments. • Training opportunities were provided for 93 members from 11 foreign countries.

47. PROGRAMME 3: LANDWARD DEFENCE (cont) Challenges • Critical shortage and continued loss of scarce skills. (limited number of MSDS members could be accommodated because of financial challenges) • Age and health status of personnel. • State of facilities. Limited intervention underway by C Log capital works. • Insufficient funding to sustain PME requirement, operational vehicle fleet and ammunition requirement. • Roll-out of Op CORONA will over-stretch the SA Army’s deployable capabilities. • Financial Misconduct, Irregular, Fruitless & Wasteful Expenditure challenges, due to • Lack of knowledge of commanders and staff to effect effective financial oversight. • Inadequate capacity in terms of financial and logistic support personnel at unit level. • Solution. A Governance Risk Management and Compliance office has been established, matters are addressed at various forums and challenges monitored on a monthly basis.

48. PROGRAMME 4: AIR DEFENCE Achievements • Successfully provided required air defence capabilities and generated a total of 33 930 flying hours. (Reserve Squadrons flew 2 860 hours) • President and Deputy President and various VIPs flown by VIP fleet. • All required sustainment flights provided to SANDF external operations. • During 2010 FIFA World Cup, national airspace security was delegated to the SAAF. • Screened 12 921 aircrew of which 6 were rejected as undesirable. • Provided 64 739 flight authorisations. • Conducted 347 combat air patrols, took appropriate action against 65 non-compliant aircraft, carried out 51 interceptions and diverted 9 aircraft away from the prohibited flying zones. • Flights conducted for 15 fire-fighting operations, 34 medical and casualty evacuations and 9 search and rescue operations.

49. PROGRAMME 4: AIR DEFENCE (cont) Achievements (cont) • Hosted 28 Air Forces during the Africa Aerospace and Defence Exhibition. • Integration and phasing in of the Hawk system essentially completed. Challenges • HR Development and Utilisation. Challenges such as slow progress inmeeting the desired demographic and gender representation targets at various levels in aircrew, technical and airspace control environments areexperienced. The progress is equally slow in the senior supervisory level (Warrant Officers) and middle management levels (Maj to Lt Col). • Affordability.  To effectively execute it's constitutional mandate, SAAFrequires to maintain all its air power competencies within the acceptableForce Design goal level.  Today this is not affordable  due to thedifference in high level of aviation inflation and the departmentalallocation of funds.

50. PROGRAMME 4: AIR DEFENCE (cont) Challenges (cont) Operational Readiness.  SAAF operational readiness status is not steady,it fluctuates because of the exceptional high levels of force employment which results in the low performance of force preparation tasks within theavailable resource paradigm. Air Force Base Durban relocation to King Shaka International Airport (KSIA).A decision to relocate was made but lack of funding from NDPW prohibitsimplementation.  Current scenario of operating from two locations isdetrimental to SAAF effective operations. AMG Agreement. Notice of termination has been given so as to enable revision of the agreement to comply with the PMFA. Although contractual termination notice period may cause delays, the DOD intends to resolve the historic problems associated with this agreement by the 1 April 2012.