This year's budget all but bookends the controversial arms deal. The final payments for most of the armaments will be made some time next year and the country has already received the bulk of its equipment - if not the promised "off-set" investments.
The budget pegs the arms deal at R47bn, with only the cost of 26 Gripen fighter aircraft as the main outstanding payment. The navy has already taken delivery of two of its three submarines - the third will arrive in April - and all four frigates have arrived.
The air force had received 22 of the 30 A109 light utility helicopters by the end of December 2007. The first search-and-rescue operation with the A109 was executed in the Drakensberg. Twenty of the 24 Hawk trainer aircraft have been delivered and should be combat-ready this year.
The steady diminution of payments for the arms deal has correlated with an increase in spending on training, salaries and infra-structure. But the army appears to have again been short-changed, with many of its vehicles and weapons either obsolete or in need of a dramatic increase in maintenance. It is also not clear how much of the training budget will go to the vital reserve force (RF) component, which is cost-effective but has long been starved of funds.
It's estimated by independent observers that if the RF is to be brought up to speed, it will need R250m more a year. The regular force has also been on short rations, and overall defence spending will have to rise by R1bn-R2bn if the South African National Defence Force is to do its job properly. The budget provides for an increase of that order in nominal terms, but the real increase after inflation could turn out to be minimal.
The context is that at present SA spends just 1,3% of its GDP on defence, arguably the lowest ratio among countries that have military establishments of any substance, and that have accepted roles beyond elementary territorial defence.
When it comes to defence spending per capita, SA is far behind developed countries. We spend the same on defence as Denmark, yet we have nearly 10 times its population and far greater regional and continental commitments. Clearly a political decision needs to be made: either the expectations of what the military must do need to be scaled down severely, or it must get more money than it has this time.
The total defence budget increased from R26,1bn last year to R28,2bn, with compensation for personnel getting the largest chunk at R10,7bn. The higher wage bill is a result of a budgeted increase of R414m/year until 2011.
The military's health budget was boosted from R1,8bn to R2,1bn. Health-care workers got a larger than average salary increase and R58m was set aside to distribute anti retrovirals to the many soldiers who have HIV/Aids.
The rise from R64,7m to R72,6m in the military health support budget for the year is - remarkably - to cater for preparations for a possible chemical and biological attack during the 2010 soccer World Cup.
The budget sets aside R1,5bn for the SA National Defence Force (SANDF) to upgrade its infrastructure. Of this amount R666,3m has been allocated over the medium term to deal with the upgrading of the runways and aircraft parking bays at the Waterkloof base. It's not a lot of money in the context of years of infrastructural neglect.
The SANDF will get an additional R700m for training, bringing the total budget for skills development over the medium term to R3,6bn and enabling the training of 12 590 new recruits.
Besides soldiers receiving better training and pay, the air force gains the most with its fighter jets - but the navy misses out on getting more warships. Any hopes by the navy that there would be some space for a fifth frigate have been dashed by finance minister Trevor Manuel. He did not say directly that there would be no space in the budget for the frigate, but the medium-term expenditure estimates make no reference to another ship.
The budget also sets aside R500m for an additional payment for the A400M military transport plane, important for support of peacekeeping operations.
In terms of equipment, the army has to make do with what it has, but the budget has allocated more for maintenance because it has to deal with an "ageing operational vehicle fleet". That description is an under statement.
When it comes to budgeting, the defence department is not sitting with its hand out. It has identified ways to cut spending for the 2008/2009 period by R23,3m.
