Get more Mail & Guardian
Subscribe or Login

Axed Armscor boss accused over R95m loss

In a new twist to the axing of Armscor boss Sipho Thomo, the Mail & Guardian understands that Thomo was alleged to have negotiated, without authority, the dropping of a $12,55-million (R95-million) penalty due from helicopter supplier AgustaWestland.

It is understood that the penalty was incurred because of the late delivery of the A109 helicopters that formed part of the government’s controversial arms deal acquisition.

According to a disciplinary charge sheet amendment seen by the M&G, Thomo was alleged “without authority and knowledge of the board” to have negotiated a revision of the penalty with Agusta.

Other disciplinary charges included:

  • That Thomo provided an “inaccurate and misleading figure” when he told a parliamentary defence committee briefing on October 14 last year that delays in the Airbus A400M programme drove up the price to an estimated R47-billion. This was attacked as wildly exaggerated by Airbus and the defence ministry (latest estimate — about R25-billion for eight aircraft), but Thomo’s disclosure seemed to galvanise government into cancelling the order.
  • The disciplinary charge sheet alleged that the misleading price tag had “serious legal and reputational repercussions for Armscor and the department of defence”.

  • Thomo failed to inform the Armscor board about the October 14 briefing, resulting in none of the members of the board attending — much to the committee’s irritation.
  • Thomo was guilty of other “disgraceful and unbecoming” conduct and “dereliction of duties”.
  • Thomo was charged at a disciplinary hearing conducted personally by Armscor chairperson Popo Molefe on December 14 and 15 in front of an independent tribunal chaired by advocate Nazier Cassim.

    According to a statement by Molefe, the board accepted Cassim’s recommendation and Thomo’s employment was terminated from January 7.

    Attempts to reach Thomo failed, but he resisted Molefe’s call for him to resign — claiming he had done nothing wrong — and is expected to challenge his dismissal.

    It is unclear why Thomo attacked the A400M project. He is known to have opposed it from the start, but some observers at the committee briefing believe he was facing questions about his own business ­interests and his salary and grasped the A400M controversy as a means of deflecting attention.

    The allegation about Agusta­Westland may also throw light on the sudden resignation of Denel Saab Aerostructures (DSA) chief executive Lana Kinley on January 11.

    It is understood that Kinley and her financial officer resigned when the DSA board rejected a new contract she was proposing.

    The contract would have given DSA much-needed cash flow to fill the gap created by the A400M delays. DSA remains a significant subcontractor to Airbus, despite the government’s cancellation of its own order.

    A defence industry source said the contract was rumoured to be with Agusta, which had proposed subcontracting DSA in relation to another helicopter contract elsewhere in Africa. However, the deal would be contingent on Agusta being relieved of outstanding arms deal offset obligations.

    DSA — which is majority state-owned — is to hold a board meeting on Friday to discuss the ­resignations.

    Subscribe for R500/year

    Thanks for enjoying the Mail & Guardian, we’re proud of our 36 year history, throughout which we have delivered to readers the most important, unbiased stories in South Africa. Good journalism costs, though, and right from our very first edition we’ve relied on reader subscriptions to protect our independence.

    Digital subscribers get access to all of our award-winning journalism, including premium features, as well as exclusive events, newsletters, webinars and the cryptic crossword. Click here to find out how to join them and get a 57% discount in your first year.

    Sam Sole Author
    Guest Author
    Sam Sole
    Sam Sole works from South Africa. Journalist and managing partner of the amaBhungane Centre for Investigative Journalism. Digging dirt, fertilising democracy. Sam Sole has over 17731 followers on Twitter.
    Stefaans Brummer
    Stefaans is an old hand at investigations. A politics and journalism graduate, he cut his reporting teeth at the Cape Argus in the tumultuous early 1990s; then joined the Mail & Guardian as democracy dawned in April 1994. For the next 16 years a late-1990s diversion into television and freelancing apart, the M&G was his journalistic home and launch pad for award-winning investigations focusing on the nexus between politics and money. Stefaans has co-authored exposés including Oilgate, the Selebi affair, Chancellor House and significant breaks in the arms deal scandal. Stefaans and Sam Sole co-founded amaBhungane in 2010. He divides his time between the demands of media bureaucracy which he detests, coaching members of the amaBhungane team, and his first love, digging for dung.

    Related stories

    WELCOME TO YOUR M&G

    If you’re reading this, you clearly have great taste

    If you haven’t already, you can subscribe to the Mail & Guardian for less than the cost of a cup of coffee a week, and get more great reads.

    Already a subscriber? Sign in here

    Advertising

    Subscribers only

    Canna-business deal for Ingonyama Trust land

    Foreign investment has been lined up for a joint venture with the Ingonyama Trust Board, which administers tribal land for the Zulu monarch

    NPA ‘refuses’ to prosecute Oscar Mabuyane

    The Hawks have accused the NPA of ‘dragging its feet’ despite voluminous evidence against the Eastern Cape premier

    More top stories

    ANC Durban election candidate shot dead while on door-to-door campaign

    One other man was shot dead and two others were rushed to hospital with gunshot wounds

    Rule of law drops globally, including in South Africa

    Security and corruption prevents the country from ranking higher on the World Justice Project Rule of Law Index for 2021

    Slice of life: ‘I can read nine or 10 books...

    David van der Westhuizen, a street bookseller based at the KwaZulu-Natal Society of the Arts Gallery in Durban, tells Paddy Harper how he survives unemployment

    South Africa opens up vaccinations for 12 to 17 year-olds

    Vaccinology researcher Professor Shabir Madhi said young people were being vaccinated to reduce the number of people who could transmit the virus and the focus should instead be on people over the age of 50
    Advertising

    press releases

    Loading latest Press Releases…
    ×