South Africa’s armed forces remain hamstrung by poor management, slow reform and deteriorating capability, despite spending R51.8 billion in the 2024-25 financial year.
The latest Budgetary Review and Recommendations Report, tabled before Parliament’s portfolio committee on defence and military veterans, paints a picture of a department still struggling to account for taxpayers’ money and to keep its equipment working.
The Auditor-General gave the Department of Defence (DoD) yet another qualified audit opinion, citing persistent flaws in procurement, asset management and financial reporting. Auditors said that a slow and inadequate response to previous findings undermines both fiscal discipline and the DoD’s constitutional mandate to protect the country.
Auditors were unable to verify the location or value of large swathes of movable assets, including Rooikat armoured reconnaissance vehicles and Mamba MK3 troop carriers. Some hardware was missing from the register altogether and some was listed at the wrong value. Adjustments to the accounts were not aligned with reporting standards.
The department also failed to report all irregular expenditure, which reached R123.8 million in the year under review. The main problems were non-compliant tenders, including an “alternative payment solution” for South African Air Force fuel and airport services, long-running breaches in Project Thusano, and various other contracts that ignored procurement rules.
Overspending on personnel pushed up unauthorised expenditure to R2.51 billion: a slight improvement on the R3.46 billion recorded the previous year, but still a breach of the Public Finance Management Act. The overshoot was driven by unplanned deployments under Operation Prosper, the use of troops to protect Eskom power facilities and clamp down on illegal mining, as well as heavier than budgeted use of reserve forces.
The Auditor General warned that investigations into irregular spending at the DoD take an average of seven years to complete. As of March 2025, roughly R16 billion in historic irregular expenditure was unresolved, with only a small portion either recovered or written off.
Little changed
Fruitless and wasteful spending, mainly late-payment interest, unused software licences and equipment, stood at about R492 million, little changed from previous years. Management boards of inquiry are often convened too late to have any effect.
The department’s 22.6 per cent vacancy rate in senior posts, including the accounting officer, chief audit executive and head of procurement, is another brake on accountability. The internal-audit unit has a 69 per cent vacancy rate, which means that many of its recommendations go unimplemented.
Financial sloppiness has gone hand in hand with declining operational capacity. The Navy posted a 41 per cent rise in sea-hours in 2024-25 after new inshore patrol vessels were delivered on time and on budget. Even so, sea-hours remain far below earlier levels, down 49 per cent over several years, because of ageing frigates and submarines, a lack of funds for mid-life upgrades and crumbling infrastructure at Armscor’s Dockyard.
The Air Force continues to have aircraft grounded owing to patchy maintenance-contract management, much of it linked to problems at Denel and poor contract enforcement by the DoD. Shortages of prime mission equipment have forced the DoD to rely more heavily on reserve forces, inflating personnel costs without resolving capability gaps.
The Army has had to redeploy soldiers from the borders to reinforce police operations in violent crime-ridden areas, undermining already thin border security. The Auditor General says these shifts in manpower, combined with deteriorating equipment, raise concerns about the DoD’s ability to fulfil its constitutional defence obligations.
The Department of Military Veterans (DMV) improved its standing, moving to an unqualified opinion with findings after addressing earlier weaknesses in recording irregular expenditure and asset management. But it achieved only 50 per cent of its service-delivery targets, and its reporting on key veterans’ benefits, such as subsidised public transport and housing support, was found to be unreliable.
Compliance shortcomings
Armscor, the state arms-procurement agency, retained an unqualified opinion but continues to face compliance shortcomings, especially in revenue collection and performance reporting. Its own dockyard infrastructure remains a bottleneck for naval maintenance.
The Castle Control Board, which oversees the historic Cape Town fort, again achieved all its performance targets, although auditors noted weaknesses in procurement procedures on some large-scale contracts.
Denel, the most troubled entity within the DoD, failed to submit its 2024-25 financial statements on time because of delays closing its 2023-24 audit. Its accounts have in past years been described as unsupported by appropriate records and not credible. Denel’s ongoing operational losses and gaps in ICT governance remain a drag on the entire defence portfolio.
The Auditor General also cited information-technology failings across the portfolio. The DoD suffered months-long delays in renewing software licences because of procurement snags at the State Information Technology Agency, leaving backup systems unreliable and disaster-recovery tests incomplete.
The DMV purchased software licences that it could not use, lacking in-house configuration skills, and still has no tested disaster-recovery plan. Armscor had no proper service-level agreement for licence pricing and has yet to finish installing power-backup systems needed for its ICT disaster-recovery site.
Vacancies aggravated these problems. The DMV’s senior-management vacancy rate was 38.7 per cent and it outsourced its internal audit function for most of the year. Armscor’s overall vacancy rate was modest at 5.7 per cent, but senior-management vacancies were 18 per cent.
The Auditor General urged the parliamentary committee to step up consequence management. It called for faster investigations, the filling of critical posts, stricter adherence to procurement laws and better-designed internal controls.
Keep falling short
The Budgetary Review makes clear that without stronger leadership, credible reporting and investment in prime-mission equipment, the defence establishment will keep falling short.
The committee is expected to press the defence minister and accounting officers to show progress before the next budget cycle.
[Image: By US Army Africa – Flickr: Shared Accord 2013, CC BY 2.0, https://commons.wikimedia.org/w/index.php?curid=32475374]
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