Chapter 2 - P rogramme 1 - Department of Defence

| Financial Performance |
Annual Report FY 2007 - 2008 218
| Department of Defence | Vote 20 |
REPORT OF THE ACCOUNTING OFFICER
for the year ended 31 March 2008 (continued)
1.1.1.7 Furthermore, the financial year was characterised by the decisive intervention to raise the levels
of awareness of Section 45 of the PFMA with regards to financial and resource responsibilities,
internal controls and asset management amongst all DOD employees. Thus, deepening the
profiling of safeguarding of resources as a shared responsibility.
1.1.1.8 Finally, the positioning of ARMSCOR and the finalisation of some transfers can be referred to
as destiny defining interventions that have characterised the strategic moves of the financial year,
whose benefits will be realised in years to come.
1.1.2 Strategic issues
1.1.2.1 Progress on the fifteen strategic issues identified is as follows:
• Rightsizing of the DOD. A new service system emanating from the HR Strategy 2010 was
instituted. This system includes measures to ensure that the rank-age profile of the SANDF is
appropriate, that the Reserves can be rejuvenated, and that scarce skills can be retained. Since 1996
the DOD has reduced its fulltime personnel strength from 101 353 to the 74 580 by 1 February
2008. The Military Skills Development System (MSDS) remains the primary mechanism through
which the Department contributes towards structured military skills as well as occupationalfunctional
skills development, leadership development amongst the youth as well as alleviating
unemployment. The MSDS is furthermore functioning as an important transformational
mechanism to impart appropriate representivity in the South African National Defence Force
and has been the main contributor in reducing the Human Resources budget to 39% of the total
DOD budget allocation (inclusive of the Strategic Defence Procurement Programme (SDPP)).
The MSDS will supply the Reserves with young trained members, whilst simultaneously facilitating
their entry into the labour market due to the skills and start-up capital they have acquired.
• Defence Capabilities. The cost of the Defence Strategy 2025 force design was determined and
the projected cost is substantially greater than the projected allocation. The strategic risks arising
from the potential mismatch between financial resources and strategic requirements have been
identified and will be presented to Cabinet.
• DOD Infrastructure. Repairs to infrastructure and buildings are being done as a continuing
project with the limited financial resources and capability of the Department of Public Works.
The gap between infrastructure supply and needs will be addressed through the Infrastructure
Delivery Improvement Programme currently being facilitated by the Council for Scientific and
Industrial Research. This project will take two years to complete.
• Redundant and Surplus Equipment. The disposal of DOD equipment is an on-going process
in which Services and Divisions submit the items and amounts to be disposed of by either the
DOD Logistic Support Formation or by ARMSCOR. Satisfactory progress is being made in this
regard.
• Defence Act, 42 of 2002. The review of the DOD legislative framework is being conducted
to ensure alignment with the latest developments within the Justice system, Defence Industry
and labour relations landscape (individual and collective). The Legal Division has been tasked to
oversee the process of reviewing existing regulations and replacing them with new appropriate
ones. Workgroups have been appointed for each functional area and several regulations have
already been updated.