SA Cuba deal that racked up R1.7 billion in irregular expenditure revived under new name

Project Thusano, which accumulated at least R1.7 billion in irregular expenditure, has been rebranded as Project Kgala.

The skills transfer deal with Cuba was signed in January 2012, and Project Thusano contract subsequently came to an end earlier this year.  

The new contract took effect in January, and officials from the Department of Defence and Military Veterans (DoD) presented the revised parameters to their relevant Portfolio Committee on Wednesday.

Thusano to Kgala

Project Thusano was a deal between South Africa and Cuba that focused on professional transport and medical training services conducted in Cuba for DoD personnel.

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In their presentation on Wednesday, the DoD justified Project Kgala as a historical imperative that continued the relationships established by Project Thusano.

“The Cubans have displayed resilience over the years, managing to keep their armed forces prepared and sustained despite staggering funding challenges and a fickle economy,” stated the DoD.

“The desired future outcome of Project Kgala is to capacitate the South African National Defence Force (SANDF) through professional skills development that enhances innovation to achieve self-sustainability,” the DoD continued.

Project Thusano cost R3 billion over 10 years, with the DoD stating that a revised Project Kgala will only cost R537 million over the next five.

R1.7 billion in irregular expenditure

The AG’s report on Project Thusano summarised again on Wednesday stated the total amount of irregular expenditure disclosed as of 31 December sat at roughly R1.7 billion.

This figure includes R1 billion linked to professional training services and R600 million in vocational training.

The AG identified the root cause of the irregular expenditure as the DoD’s failure to perform a cost-benefit analysis prior to the project’s commencement and inadequate record-keeping that hampered financial reports and decision-making.

DoD officials assured the committee that these issues had been rectified in that fees had been reduced and costs had been fixed.

Additionally, the number of travelling managers and leaders will be reduced, and administrative tasks will be streamlined for efficiency.

Vocational training of SANDF members in Cuba was a large portion of the AG’s identified irregular expenditure, and this will now be classified as a foreign learning opportunity.

“This is the only binding contract with the Revolutionary Armed Forces of Cuba with regards to the provision of technical services to the SANDF,” stated the DoD.

Watch full Portfolio Committee on Project Thusano’s rebranding:

Students failed to meet local standards

The AG shared a list of insights on Project Thusano that detailed the various shortcomings of the project.

Regarding vehicle repair and maintenance, Cubans were being paid without logging time sheets, while the DoD claimed 10 779 military vehicles were repaired during a seven-year period.

The DoD sent 108 medical students to Cuba between 2015 and the end of March 2024 and spent 136% more on sending them to the island nation than it would have if the students had studied in South Africa.

Sent in six batches, only six of the first group of 21 students who arrived back from Cuba passed an 18-month integration course at the University of Pretoria.

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As with their medical compatriots, the South African mechanics in Cuba cost “86% to 162% more” than if they had done the same courses at home.

“A total of 196 transport technique students were enrolled in Cuba between 2015 and March 2023. Of these, 134 students completed their studies successfully, and 62 were still studying at the time,” the AG’s report states.

However, only 52% of those obtained South African Qualification Authority accreditation when arriving home.

Renaming the ‘same animal’

The DoD stated the collaboration with Cuba was necessary as South Africa lacked the ability to properly train its military personnel.

The EFF’s Carl Niehaus suggested the DoD provide their needs and costs assessment but urged the department to operate within the Public Finance Management Act.

“I think we are dealing with a situation where the SANDF is telling us we cannot rely on the patriotism of local domestic industry and its provisions. We need a more reliable path,” stated Neihaus.

The DA’s Christiaan Hattingh highlighted the contrast between the AG’s finding and the objectives of Project Thusano and its successor, saying the DoD’s assertions were “unreliable”.

The DA’s Shadow Minister for Defence said the project was costing jobs and questioned whether South Africa had benefited in any way in the last decade of the project’s existence.

“By changing this animal’s name from Thusano to Kgala, it remains the same animal,” Hattingh said.

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