1. Defence budgets are typically the product of a range of considerations: the wealth and size of a country; competing demands on resources from different sectors of government and the population; prevailing and projected threat scenarios; the actual and anticipated role of the Defence Force; and its doctrine and posture.
2. As indicated previously, in the South African context there is pressure to reduce defence spending substantially:
2.1 There is an urgent requirement to divert financial resources to the RDP in order to meet basic socio-economic needs. A failure to meet these needs will generate conflict and instability.
2.2 There is no conventional military threat in the short- to medium-term.
2.3 South Africa has no aggressive intentions towards any state.
2.4 South Africa enjoys co-operative relations with neighbouring states. The non-military threats emanating from instability and underdevelopment in Southern Africa should be tackled primarily through political and socio-economic measures.
2.5 The ending of the Cold War has given rise to disarmament and demilitarisation in many parts of the world, including Southern Africa.
3. At the same time, there are several reasons to avoid making radical cuts to the defence budget:
3.1 The SANDF has to maintain a long-term capability to fulfil its primary function. It is not possible to create such capability from a low level of preparedness if the need suddenly arises. It is therefore imperative to retain a sustainable core force and to upgrade and, where necessary, replace obsolete equipment [Chapter 5].
3.2 The SANDF should be a balanced, modern and technologically advanced military force.
3.3 The widespread internal deployment of the SANDF in co-operation with the police necessitates retention of the ability to mobilise substantial numbers of troops.
3.4 South Africa is expected to play an active role in regional defence co-operation and peace support operations in Africa.
3.5 The integration of forces has raised force levels substantially; a process of rationalisation and demobilisation will consequently be undertaken. The success of integration, demobilisation and rationalisation requires adequate funding.
3.6 As a result of the improved external strategic environment and changing government spending priorities, the defence budget has been cut by over 50% in real terms over the past five years. This has had a significant impact on the military's anti-aircraft, armour, air and maritime capabilities in particular.
4. It is evident from the above that there are competing pressures on the defence budget. This is true of most countries, particularly in post-conflict situations. In developing countries such as South Africa, there is especially strong pressure to reallocate resources from the military to socio-economic development.
5. In democratic societies the debate around defence spending is informed by public opinion and the professional views of the DOD and other government departments. The resolution of the debate, and the approval of major weapons procurement projects, is the prerogative of Parliament on an annual and longer-term basis.
6. The Defence Review will entail comprehensive long-range planning in the light of approved defence policy and the new political and strategic environment. The Review will present, for the consideration of Parliament and the public, detailed and well-motivated budgetary forecasts and proposals; specific policies regarding the provisioning of logistic resources; and the identification of appropriate technology to optimize the cost effectiveness of the core force.
7. The Defence Review will also include an examination of prevailing conditions in the SANDF with the view to rationalising current spending, eliminating waste and unnecessary duplication, and determining the most efficient means of managing human and material resources.
8. Prior to the completion of the Defence Review, the DOD will provide Parliament with the information and analysis required to make sound decisions on the defence budget.
9. Finally, the establishment of a relatively small Regular Force and a sufficiently large Part-Time Force will be one of the principal means of ensuring a cost-effective defence capability [Chapter 6]. It is important to reiterate that demobilisation and rationalisation will generate additional costs in the medium-term but yield considerable savings in the long-term.
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