September 22nd 2001

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Articles from this issue:

STOP PRESS: Who has declared war on the United States?

COVER STORY: Canberra to blame for Ansett's demise

CANBERRA: Asylum seekers bring ill tidings for Beazley and the ALP

COMMENT: Boat people reaction - echoes of the 1970s

NEW ZEALAND: Army caught in political imbroglio

STRAWS IN THE WIND: Send in the counsellors / Good morning, Vietnam

MEDIA: Out of touch with majority sentiment

LETTERS: Tristar: another view

Letter: Poor reception

Letter: Let them stay

REGIONAL AFFAIRS: Why East Timor chose Portuguese

TRADE: Lamb exports: where to now?

BUSINESS: Selling wholesome food to Australia's homes

FAMILY: Well-being of families and nation intertwined

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Army caught in political imbroglio

by Bernard Moran

News Weekly, September 22, 2001

Bernard Moran reports from Auckland on a scandal that has engulfed the NZ Army.

New Zealand Labour's Minister of Defence, Mark Burton, has finally conceded that a Parliamentary enquiry will be held into claims that the Army organised a covert political strategy to increase its share of defence funding and lobbied to end the Royal NZ Air Force's combat arm, the A4 Skyhawks.

In Parliament on August 30, Opposition Leader and former Prime Minister Jenny Shipley stated: "We believe there is mounting evidence that covert and seditious behaviour was going on within the Army from early 1997, through to the end of 1999 and possibly beyond then."

Earlier that week the Nationals released a nine-page letter, written in March 1997, by Lieutenant Colonel Ian Gordon (then with the NZ Defence Staff in London) to the Deputy Chief of General Staff in Wellington. The letter outlines a detailed strategy to insert selected army officers into key positions where they could subtly influence senior politicians.

The National Party defence spokesman, Max Bradford, claimed the Gordon letter spoke of "destroying" any organisation or individual who took a different view from the Army's.

All this came in the same month that the Auditor-General, David Macdonald, released a scathing report on how Defence staff bungled the Army's largest re-equipment project since 1945: the purchasing of 105 General Motors armoured personnel carriers, the LAV 111. The project has ballooned from an initial allocation of NZ$212 million to $677 million, and is still climbing to almost $7 million a vehicle.

He condemned the bitter power struggle between the Army's Chief of Defence Staff, Major-General Maurice Dodson, and the Chief of Defence Force, Air Marshal Carey Adamson. The working atmosphere and practice at Defence Headquarters were described as "dysfunctional".

Meanwhile, Dr David Dickens, Director of the Centre for Strategic Studies at Victoria University in Wellington, and a critic of recent defence policy decisions, suddenly found his Government funding withdrawn. Prime Minister Helen Clark denied any responsibility.

So what is going on? The root cause is the lack of money spent on defence by two successive governments, Labour from 1984 to 1990 and the incoming Nationals under Jim Bolger (Prime Minister 1990-97). The UN deployment to Bosnia involved working with British forces, and brought home to the Kiwis the woeful state of their equipment.

The 1997 Defence Assessment White Paper envisaged the Army rapidly deploying lightly equipped forces: "but it must have sufficient firepower, mobility and protection to cope with the type of warfare that could occur within the Asia-Pacific region, as well as the changing spectrum of peace support operations."

The Army considered that future forces would be engaged in "manoeuvre warfare" (alongside more heavily equipped allies) and that fast, agile light armoured vehicles would be required not only to carry the infantry, but to provide effective firepower in support. This led to an internal debate on "wheels versus tracks".

Wheeled vehicles might be more suitable for operating in Australia, or in a repeat of the Gulf War, but the other view was that "manoeuvre warfare" was unlikely in the jungles of the South West Pacific and Asia. However, the "wheels versus tracks" review completed in September 1998 recommended "wheels".

Which brings us to the March 1997 letter of Lieutenant-General Ian Gordon. With hindsight it is clear that the Army was deeply concerned that they would get the crumbs after the Air Force and the Navy had been fed. In the opening paragraph of his letter, Gordon wrote:

"Funding allocated by NZ Defence Force [representing the three services - Ed] has been to Navy and Air at the expense of Army. Army appears to lack influence in the centre (NZDF) and a different approach is required to regain this influence. It is contended that to gain the requisite influence, Army must now open a ‘second front' in its war with the centre."

Army had to identify and control the pathways to the making of defence policy and then "gain the requisite degree of control over the policy-making process; co-ordinated at the highest level to ensure each campaign advances the strategic purpose".

East Timor was a godsend for the Army, enabling it to cultivate deep links with the incoming Labour Government and provide behind-the-scenes support for cancelling the American F-16 Lease-Buy deal. A peacekeeping Army is more acceptable to Labour's coalition partners, the Greens and the Alliance Party.

Now, with Ian Gordon's letter in his hands, and the RNZAF's fighter pilots and support staff handed their notice, you can imagine how Air Marshal Adamson regards his Army colleague. For the record, Major-General Dodson denies any knowledge of the Gordon letter.

The Auditor General's report confirms that the Army wanted the state-of-the-art LAV 111, and essentially the tender specifications were determined to achieve that end. It was bad luck for the competitors, and a German subsidiary of Daimler is threatening to sue the NZ Government for NZ$2 million on the grounds that their time and money was wasted.

Not mentioned in the Auditor General's report is a meeting on October 12, 1998, in the Conference Room of the NZ Embassy in Washington DC. Major-General Dodson was on a routine visit as Chief of the General Staff to Australia, Hawaii and Washington. Also present in the Conference Room was James Armour, President of AM General Motors, Dr Kent Stephens and Lt Gen (retd) James Hughes of Litton Industries, the manufacturer of the LAV 111. Jim Bolger was the NZ ambassador at the time, and presumably the meeting was first cleared with Wellington.

Registrations for the tender process were called in June 1999. Earlier, a British consulting firm had recommended that there was no need for tenders, as the LAV 111 was clearly the best vehicle. The contract was signed in January 2001, and the 105 vehicles will be delivered over the next three years.

NZ First MP Ron Mark has been a persistent critic of both the tendering process and the LAV 111. Of all the MPs in the NZ Parliament, Mark has the necessary credentials. He first served as a diesel mechanic with the NZ Armoured Corps, working on the Vietnam-era M113s, and then joined the British SAS, serving mainly in the Middle East. On his return to the NZ Armoured Corps, he rose through the ranks to Major.

Mark maintains that his contacts in the Army tell of deep discontent over the choice of vehicle. Incredibly (as the Auditor General points out), the mistrust and lack of communication between the Ministry of Defence, the NZ Defence Force and the Army, resulted in no one being responsible for maintenance evaluation. The skilled technicians required to maintain the sophisticated LAVs are not currently available, and will have to be recruited at a time when such skills are greatly in demand in the civilian sector.

Nor was Litton Industries required to bring an LAV 111 to New Zealand for field testing in the rugged, tussock country around the Waiouru training ground. Based on reports coming out of Canada, there are concerns about the vehicle's stability.

Investigate magazine has run letters from anonymous NZ servicemen. One reports covertly attending a lecture last year by two Canadian warrant officers, who showed slides of the LAV's alleged handling difficulties on sloping ground.

They detailed mechanical problems such as occur when the 24mm cannon is fired; the ejected casings fall and tend to jam the driver's hatch and the turret. The gun can fire 200 rounds, but takes 23 minutes to refill. The battery-powered turret often loses power, and when this happens the gun stands up in neutral. The turret is computer-operated, and there are a whole range of "no-fire zones" installed on the gun that cannot be manually overridden.

The LAV 111s cannot be used in East Timor because of the narrow unstable roads; nor are they amphibious, presumably an essential capability for operations in this part of the world.

It is now acknowledged by the Ministry of Defence that the gun needs to be upgraded to 30mm, and there is the vexed problem of fitting the LAV into an Air Force Hercules C130. This rather crucial requirement was termed "desirable" by the Ministry of Defence, and the Army and Mark Burton have obtained a video that shows a LAV being squeezed into a C130 by deflating the tyres.

However, according to a Pentagon report on weight limits, the C130 can fly a 42,000 lb payload about 560 nautical miles. As the LAV 111 weighs 41,942 lbs, the RNZAF will be able to fly one nearly half way across the Tasman Sea to Sydney!

Tibor Banfy, a Hungarian businessman in New Zealand, arranges barter deals and had been encouraged by Jim Bolger to advise him on any potential defence purchases. Banfy discovered that the Hungarian Border Guard had 68 unused Russian-built BTR-80s, with more available at a landed price in New Zealand of NZ$230,000 per vehicle. 105 BTR-80s would cost NZ$24 million compared with NZ$677 million for the LAVs.

Rugged and battle-tested, the BTR-80 can be "retrofitted" to NATO standards by Vickers and Bofors. A 30mm "drop in turret" can be fitted and the series offers a range of armoured vehicles based on the same chassis, ambulances, cargo carriers and even mobile howitzers. The vehicle is amphibious and capable of crossing 106 kilometres of lake or sea at a stretch.

Currently used by the Turkish and South Korean armies, the BTR-80 had the best serviceability in Bosnia out of 16 contenders. Radios can be made compatible with it and a US Cummins diesel engine can be fitted, although the Russian-designed one meets requirement. The BTR-80 can be carried by the RNZAF's C130s.

Helen Clark wrote to Banfy listing the reasons why the BTR-80 would be unsuitable. It was clear that she had been misinformed by her advisers.

Appearing on TVNZ's Face the Nation on September 6, the Nationals' Max Bradford was interviewed with Defence Minister Mark Burton.

Bradford brought up his July 19 letter to the Minister, in which he expressed his concerns and suggested the need for a bipartisan enquiry. Incredibly, Bradford had still received no response to his letter.

However, Burton has agreed to an enquiry, but is arguing for time to weigh up legal advice. Naturally there are fears that the terms of reference will limit full disclosure. Former Deputy Secretary of Defence Robin Johansen was on the program and stated that he was eager to appear before any enquiry. He said that the Army really had no clear idea of why they needed such an expensive and sophisticated vehicle as the LAV 111. He was astonished at Army's inability to provide any doctrinal or operational justification.

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