Sechaba ka’Nkosi
Agusta, the company which won a R2,2- billion contract last week to supply the South African National Defence Force (SANDF) with 40 A109 helicopters, has been implicated in a multimillion- dollar corruption trial in Belgium.
The company has been accused of bribing politicians in an attempt to win defence contracts. Last week it was one of six European firms granted R29- billion worth of contracts to provide high-tech military hardware to South Africa.
Questions are already been raised about its successful tendering.
Institute for a Democratic South Africa defence expert Nobuntu Mbhelle said she found the Agusta contract with the SANDF strange.
“The whole industry is controversial. But I find it more bizarre that so much money that was not even provided for in the national budget could be spent on such deals. To me that sounds like politics rather than military,” said Mbhelle.
Mbhelle’s assessment is backed by United Kingdom-based analyst Paul Jackson, who says some of the companies who lost the bid could have provided South Africa with hardware at a cheaper rate.
Says Jackson: “These companies are reputable with a lot of integrity.”
Agusta is one of the two European companies implicated in a corruption trial which has brought down former Nato secretary general and Belgian finance minister Willy Claes, two fellow ministers and seven senior aides.
The trial, dubbed the “trial of the century” by European media, started in Brussels in September. It centres around the acquisition of 46 Agusta A109 helicopters by the Belgian army, and a surveillance system for the Belgian Air Force’s F16 aircraft.
Agusta and Dassault are accused of channelling more than R30-million to Belgian political parties as kickbacks in return for the massive defence contracts.
Investigators first unearthed evidence linking Agusta and the bribes in 1991, when probing the death of Belgian Deputy Prime Minister Andre Cools, who was shot dead in a Mafia-style execution outside a Brussels flat.
Unconfirmed reports claim Cools was on the verge of exposing the extent of corruption among his fellow ministers.
Meanwhile Agusta has been embroiled in another questionable deal in South Africa. The country’s port authority Portnet has appointed an untraceable company to manage two K-2 helicopters it bought for nearly R10-million from Agusta in August.
Balmoral Aviation was last week awarded a tender to manage the helicopters. Portnet will pay Balmoral R40-million over the next five years.
The Registrar of Companies has no records of Balmoral.
Defence industry sources say Portnet’s decision to award the contract to Balmoral is also irregular because the company does not have black partners – as stipulated by government procedures for parastatal tenders.
Vaughn Peacock, former senior manager of Court Helicopters, allegedly advised Portnet on the “required” specifics for the helicopters before establishing Balmoral, industry sources say.
During the bidding process for the tender, Peacock was seen in the company of Agusta executives, one of whom has moved from France to Pretoria to manage its interests in South Africa.
Several attempts by the Mail & Guardian to locate Peacock failed as Court Helicopters has no record of his present whereabouts and Balmoral is not listed in any South African telephone directory. Portnet refused to comment on the deal.
In South Africa, allegations of corruption and kickbacks emerged as rival bidders questioned the process that led to the eventual signing of the trilateral contract between Portnet, Agusta and Balmoral.
Peacock, in particular, is accused by his rivals of having sat in the Portnet presentations by other companies.
When this was contested, Portnet allegedly informed them that Peacock had been retained to advise them on the helicopters that Portnet wanted to purchase.
Peacock left Court Helicopters in June to “join” Balmoral after a fall-out with the company on allegations of mismanaging the sea-rescue helicopter John Rolfe, the Europassist and Portnet contracts.
A few weeks later, Portnet appointed Balmoral to manage their helicopters, before they were delivered.
Industry sources say Balmoral does not have a helicopter licence, operations, infrastructure, personnel, helicopters or a black partner – a condition set by Portnet for all the bidders.
“To us Balmoral remains a one-man show. This is why there is so much rumour in the industry about a commission Vaughn [Peacock] received on the contract and possible kickbacks made to senior executives at Portnet,” says one source.
Scant details of the Portnet deal were made public in August. But the industry believes the announcement was a mere formality as the deal had been hatched and sealed by three people long before it was announced.
In terms of the agreement, Agusta will provide Portnet with the helicopters and instal military specifications such as a night vision cockpit.
“The military specifications make it very expensive and Portnet does not need this,” said a source in the industry, pointing out that it is unlikely Portnet will go to war soon.
Industry sources say delivery on such transactions generally takes more than a year to finalise. Portnet, however, got its helicopters last week, barely three months after the deal was announced.