South Africa's defense budget grew almost tenfold in nominal terms between 1975 and 1989, from R1 billion to R9.4 billion. In constant dollar value, however, the increase was modest--from US$3 billion per year in the early 1980s to US$3.43 billion per year in the last half of that decade, based on 1988 prices. Defense spending averaged 16.4 percent of government budgets in the 1980s; it ranged from a high of 22.7 percent in 1982 to 13.7 percent in 1987, but rose to 15.7 percent of government spending in 1989.
Although South Africa's defense spending was high in comparison with economic output in the 1980s, the "trend toward militarization" in that decade, which was noted by many observers in analyzing South Africa's apartheid-era spending, was not evident in global comparisons. Out of 144 countries surveyed by the United States Arms Control and Disarmament Agency in 1989, South Africa ranked thirtieth in total military expenditures, forty-fourth in military spending as a percentage of gross national product (GNP--see Glossary), and sixty-third in military spending as a percentage of total government spending. South Africa also ranked forty-ninth in the size of its armed forces and 103d in the size of the armed forces in relation to population.
South Africa’s external strategic environment changed dramatically after 1989. The end of East-West contestation was accompanied by a reduction in ideological tensions within and amongst African countries, by significant moves towards political pluralism in Southern Africa and by the end of apartheid in South Africa. These developments contributed to the resolution of most of the region’s historical conflicts and, especially after South Africa had set itself on the road to democracy, provided opportunities for countries in the region to reduce their levels of military spending and implement disarmament measures, including the demobilisation of former combatants.
These interlinked processes of democratisation and disarmament, which occurred in many countries in the region, had a positive impact on the South African state’s threat perceptions, and this lead to dramatic changes in the country’s defense and foreign policies and a rapid decline in the defense budget.
Between 1989/90 and 1997/98 the defense budget declined by over 50% in real terms, while the acquisition budget (the Special Defence Account) declined by over 80% in real terms during the same period. In 1997/98 acquisition spending accounted for 20% of the defence budget, down from nearly 60% in 1989/90. The dramatic cuts in defense spending have had a major impact on domestic defence related industries, which have been forced to downsize and restructure as a result of the cancellation or postponement of defense contracts, resulting in the retrenchment of large numbers of workers since the late 1980's.
By the mid-1990s, defense spending had been reduced to less than 3 percent of gross domestic product (GDP), and less than 10 percent of total government spending. Military salaries consumed more than half of defense spending, in part the result of the military reorganization. Spending on armaments and equipment had declined, as a portion of defense spending, from 44 percent in the 1980s to 28 percent in 1994, according to newly appointed SANDF chief General George Meiring. Meiring and other defense officials in 1995 expressed concern about military preparedness, noting the reduced production and acquisition of armored vehicles, the decline in antiaircraft capability, the reduction of civil service positions from 144,000 to about 100,000, the closure of military bases, and the reduction in military training courses. Deputy Minister of Defence Ronnie Kasrils said in 1995 that the government's planned cuts in defense spending could also result in the loss of as many as 90,000 jobs in defense-related industries.
The budget for military intelligence in 1994 was R163 million, and of this, R37 million was allocated for clandestine military intelligence gathering, according to a senior military intelligence officer reporting to the Joint Committee on Defence in October 1994. Spending on clandestine military intelligence was about 1 percent of the total military budget, according to the 1994 report.
The main budget announces government spending for three years going forward: that is, the years of the medium-term expenditure framework (MTEF). Through an accompanying Appropriation Bill, the executive seeks Parliament’s approval and adoption of its spending plans for the new financial year. Amounts allocated for the first year of the new MTEF period are then appropriated from the National Revenue Fund in terms of the Appropriation Act, once approved by the President. The main budget also provides for a contingency reserve for expenditure related to unexpected circumstances.
Two of the projected joint, interdepartmental and multinational exercises were cancelled by the countries that were to lead the exercises. The projection for 2011/12 has therefore been reduced to 6. The number of defence diplomatic missions was expected to remain the same. However, 2 additional missions have been opened. The projection for 2011/12 has therefore increased to 39.
The performance of the Department of Defence is on track, although some projections may have been exceeded. Although 3 large scale external operations were planned, only 2 were needed. Although not considered to be a large scale operation, 1 additional external operation was conducted in support of the Mozambique government to combat piracy in the Mozambique Channel. All 4 planned internal operations were conducted mainly in cooperation with the South African Police Service during the local government elections and border safeguarding. Border safeguarding continued through the deployment of 7 sub-units in Limpopo, Mpumalanga, KwaZulu-Natal and Free State. Safety and security support was provided at various events, including search and rescue operations as well as disaster aid operations. An additional R81.437 million is allocated to the South African Defence Force for the deployment of members to, in conjunction with the Mozambican Defence Force, counter piracy in the Mozambican Channel.
The Department of Defence and Military Veterans budget request declined by R272,7 million from R30,7 billion for 2010-11 to R30,4 billion in 2011-12. According to the Estimate of Expenditure, savings of R506,6 million in 2011-12, R568,1 million in 2012-13 and R549,2 million in 2013-14 have been identified across all programmes in spending on goods and services, mainly on contractors. Cost-cutting measures include limiting overseas visits and travel; limiting the replacement of sedan vehicles; reducing the procurement of books, pamphlets, magazines and office furniture; and curtailing work sessions and catering.
At the end of 2011, the total Reserve Force strength was 26 851 of which 15 316 were called-up during the year. This call-up constitutes a record since 1994. In the previous year (FY 10/11) only 12 300 Reserve Force members were utilised. Continued utilisation of Reserves in both external and internal operations is increasing and the Reserves are being called-up for Peace Support Operations (PSO), Border Protection, training camps as well as staff duties. The Ministry has concluded a draft of the Defence Review. This has been the most extensive engagement that ha ever been undertaken by the Minister of Defence in this country. The public interaction on the Defence Review concluded in August 2012, which was followed by a 4 day retreat in September 2012 with all stakeholders to ensure that the process is as collaborative as possible.
The budget is made under a global economic environment that continues to be robust and uncertain, resulting in pressures being exerted on Defence budgets across the world. This requires achieving higher levels of efficiency in all operations and more precise targeting towards the achievement of key priorities. While this is the case, it is also important to emphasise that the Defence budget cannot afford to take further cuts thereby shrinking the proportion to GDP to levels lower that the current low levels of 1.2 % of GDP as this will impact negatively on readiness. The discussions and proposals that are being made as society debate the Defence Review document should assist in determining the direction we need to take and therefore the related resource allocations going forward.
The current budget allocation for the 2012/13 financial year is R37, 5bn up from last year’s adjusted allocation. It is expected to grow to R39, 9bn in 2013/14 by 6.5% and reach R42332.1 in 2014/15 up by 6%. Changes to the baseline over the MTEF period include R749.2 million for borderline control, R23 million for the establishment of the Office of the Military Ombud and R600 million for the completion of the strategic defence procurement program.
Every literate South African now knows that the budget falls far below the requirement that we wanted to cover all of our borders resulting in a need to prioritise key areas and develop strategies that will ensure we are able to deter and prevent illegal activities in these areas.
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