CHAIRPERSON: Let's get ready to start ladies and gentlemen. This is a resumption of evidence being taken from Doctor Knobel, and who I have to remind is still under oath.

NEIL KNOBEL: (s.u.o.)


MR VALLY: Thank you Mr Chair.

CHAIRPERSON: I believe that you and Doctor Basson had an encounter yesterday.


CHAIRPERSON: Of the closest kind.

MR VALLY: I would request you to choose your words very carefully Mr Chair.

DR KNOBEL: Mr Chairman, you can imagine my concern, I mean I'm trying to cooperate with the Truth Commission and here Mr Vally is fraternising with the main witness.

CHAIRPERSON: I can appreciate your concern Doctor Knobel.

DR KNOBEL: Thank you.


MR VALLY: Thank you Mr Chair.

I want to ask you one question about TRC11 before we go on to the recent batch of documents you've brought to me. Do you have TRC11 there?

DR KNOBEL: Yes, Sir, I can get it. Yes?

MR VALLY: If you look at paragraph 3 in TRC11.

DR KNOBEL: Yes, I've got it.

MR VALLY: Now I need an explanation, you are talking about Project Coast that involved a number of aspects and activities including, you say:

"Defensive and offensive Chemical and Biological Warfare; even a special operational aspect"

What was meant by that?

DR KNOBEL: Well the operational aspect referred to the development of CR and the incapacitating agents which would be used in a dual use capacity, both as a counter-measure or a retaliatory measure in the battlefield if necessary, as well as in the crowd control or riot control role.

MR VALLY: I'm trying to understand why special operational measure. I understand CR gas would be part of the possible defensive, possibly offensive warfare capacity but why separately, separate operational aspects?

DR KNOBEL: Yes, I think it's misleading, there's nothing more to say than what I've already said Mr Vally.

MR VALLY: Well there is a suggestion that the special operational aspect had to do with possibly the toxins which were, we know now, distributed for individual murders.

DR KNOBEL: Well certainly that was not meant by this paragraph when I signed this.

MR VALLY: Okay. And that letter is dated the 17th of May 1991.

DR KNOBEL: That's correct.

MR VALLY: Under the reference of Brigadier Basson?

DR KNOBEL: Yes, that's correct.

MR VALLY: Well let's go onto the new documents. I'm now looking at J3.


MR VALLY: Do you have it in front of you?

DR KNOBEL: I'm not sure Mr Vally, I've got the Appendix J but your numbering is not my numbering, so maybe if you'll just tell me which document you're referring to.

MR VALLY: Certainly. This is the minutes of the Co-ordinating Committee Meeting of the 29th of March 1994.

DR KNOBEL: Alright, I've got it.

MR VALLY: Now my first question is this, paragraph 3 -I'm sorry, paragraph 2 rather, first. There's reference to:

"The Surgeon General"

which is yourself:

"will check with the PG"

and I assume that's the Attorney General:

"as to what their investigations have shown and where this case stands"

But the heading to that refers to previous minutes and it talks about the destruction of samples, can you just elucidate on this matter, what was it about?

DR KNOBEL: Yes, let me just go back to the previous minutes Mr Vally. If you look at the previous minutes Mr Vally, dated the 9th of January - oh no, I beg your pardon, that's not right, let me just get back to that one, when the substances were destroyed, the substances we discussed yesterday, there was a requirement both from the Auditor General as to the value of the substances that had been destroyed. For that we had to obtain a value certificate, which I think is added or is attached to the destruction certificate and which ultimately led to General Meiring having to submit to the Auditor General a letter in which he says what the true value was. That is attached to the documents here and I think you may have seen it.

At the same time the Attorney General's office, as far as I can recall, required about the destruction and whether we could provide the necessary report. If you look at the minutes of January '95 which follows the meeting that you are referring to you will see that we were still waiting for a written report from the police so that we could provide ultimately a complete report to the Attorney General. And you will see it also refers there to the Auditor General which also wants a value certificate of the substances that had been destroyed.

MR VALLY: The question is, why was the Attorney General involved regarding the destruction of samples? This is now in March 1994.

DR KNOBEL: I think it was, if I recall correctly, it was because all these substances were restricted substances and they wanted to have proof that it was in fact destroyed. For the same reason that you are also concerned about whether it was destroyed or not, the fact that they were restricted substances.

MR VALLY: Let's go on. We're still busy with J3. Now paragraph 3:

"Data slegging"(?)

This is the reference to the special safe which was created wherein these optical discs were finally put in, is that correct?

DR KNOBEL: That's correct.

MR VALLY: Paragraph 7, here you say that you had dealt with General Regley of the Swiss, it says: "Inligtingsdiens"

Can we, if the spelling is correct, can we assume that's Swiss Intelligence?

DR KNOBEL: Yes, that's correct.

MR VALLY: Regarding Doctor Basson's or Brigadier Basson's statements and you were convinced that the money was lost and you say that the case against Brigadier Basson was closed on the 22nd of April 1994, and this in Switzerland I assume?

DR KNOBEL: That's correct.

MR VALLY: How much money was lost here?

DR KNOBEL: Oh dear Mr Vally, I have to ...[intervention]

MR VALLY: Alright.

DR KNOBEL: I think it was three and a half million rands in round figures but if you want me to explain what is going on here ...[intervention]

MR VALLY: It will help when we come to those transactions later on. That's got to do with the Croatian transactions?

DR KNOBEL: This is the Chicane transaction.

MR VALLY: Right we'll go through that in more detail shortly.


MR VALLY: Let's go to paragraph 10, the heading above it is:

"Item 4: Protechnic Oorname"


MR VALLY: Protechnic Take-over. Now you were here when Doctor Mijburgh was giving evidence and he stated that only Delta G was a military front company, the other companies such as Medchem Technologies of which Delta G was a wholly owned subsidiary.


MR VALLY: It was not a military front company?

DR KNOBEL: That's right.

MR VALLY: Looking at the details set down under paragraph 10, can I understand this: you would have a contract with the company, Protechnic for example, and I say: "you", I mean the Defence Force.


MR VALLY: You decided that this project has to end, would you as a matter of course then pay out the remainder of the contract?

DR KNOBEL: No, not necessarily.

MR VALLY: Now this is what appears to have happened regarding Protechnic.

DR KNOBEL: In paragraph 10(b)?


DR KNOBEL: Mr Vally, I've been trying to explain to you from the beginning that Protechnic was not a front company.


DR KNOBEL: If you will allow me, in your own documentation, I think it's TRC10, if you will allow me just to deal with this issue a little bit.

MR VALLY: Sure. Understand my question, my question is that all these companies with which you had contracts once Project Coast ended, were they paid in terms of what the remainder of the contract value was?

DR KNOBEL: No, it was part - I'll answer that question first if you like but I would like to come back to this TRC10 if you will allow me. The front companies in my opinion, was correctly described by Doctor Mijburgh, in the sense that those were the companies that were erected with State funds and the State were the beneficiaries of those companies.

There were a lot of other companies that had been established or been used as private companies by the project and on those companies certain contracts existed. ...[intervention]

MR VALLY: Stop just there. Used as private companies by the project?


MR VALLY: What does that in effect mean? This was a military project?

DR KNOBEL: No, Mr Vally. The Defence Force has contracts with numerous private companies that provides technology and provides equipment etc., to the Defence Force. The fact that Protechnic was a specialised company in terms of the development of detection apparatus, decontamination apparatus, evaluating masks and filters and so on, obviously made it a primary company for the use of the Defence Force.

When it was taken over by Mr Zimmer and Mr van Remoortere who also testified here, it was then a totally private company where that type of expertise and, the main client of that company was the Defence Force certainly and the Defence Force had contracts with them.

What happened then was, Protechnic was considering closing down because the Defence Force requirement was reducing, it was becoming less than what it had been before. We had established the technology, we had established the state of the art standardisation techniques for masks, filters, decontamination etc., etc. And they were considering closing down.

I then went to Armscor and said we cannot afford to lose this expertise that we have in that company. I recommended to the Co-ordinating Management Committee that we should persuade Armscor to take over this company. The New Chemical Weapons Convention makes provision for any country in the world that is a State party to that convention to have what is described in the Convention as a single small scale facility which can continue to do the type of research to keep ahead with the state of the art equipment in terms of masks and filters and decontamination and clothing and that sort of thing.

That was what was taking place here. Armscor had agreed that they would go into a negotiating phase with Mr van Remoortere and they had come to an agreement about the payment and they took over the company and from that moment onwards the company was registered as the single small scale facility of South Africa in terms of the New Chemical Weapons Convention, and was so declared.

And in fact very quickly after the Convention entered into force, the Convention entered into force in March/April last year, if I remember correctly it was the 28th of April and very soon thereafter the Organisation for the Prevention of Chemical Weapons did an inspection at Protechnic in terms of the requirements of the Convention, gave them a positive report and soon after that, during November of last year, Protechnic transferee to new premises just outside Pretoria as a subsidiary now of Armscor and they were reinvestigated, reinspected by the OPCW and again given a positive certificate.

So what is reflected here is the process of where I'm being made aware, and Mr van Remoortere spoke to me personally and said: "I'm considering selling this company, I'm not getting enough business and I've lost interest in this area of expertise, what should I do"? And I said: "I will bring you into touch with Armscor and you start negotiating with them". And this is what is reflected here.

MR VALLY: Well, let's look at 10(b), the issue is this, because it's not so much Protechnic I'm talking

about, I'm talking about front companies and I'm talking about other companies linked to front companies. Paragraph (b):

"Dat die SAW die kontrak kansellasie van die deel"

"The contract cancellation of the deal"

of that part of the contract which is not being continued, they'll pay out the balance of the contract, that's what I understand it to say.

DR KNOBEL: There was an outstanding contract that had not been settled yet.


DR KNOBEL: And in the process of taking it over, as soon as it becomes an Armscor company, the relationship between Armscor and the Defence Force is quite different of that between the Defence Force and a private company, and a subsidiary of Armscor then would do research on a different basis controlled by an organisation called: "The Veenor: Verdedigings Navorsings Ontwikkelingsraad". And it then becomes part of the Defence Force budget, not a project budget any longer but a normal running ...[intervention]

MR VALLY: I understand all that. My question still remains, the balance of the contract which as a result of this further take-over by Armscor is outstanding, the monetary value thereof was paid out to the owners of the company?

DR KNOBEL: That's correct.

MR VALLY: Right. Now having said that, you know we gave a list of - and I'm not sure if a copy of that list was given to you as well ...[intervention]

DR KNOBEL: I've got it here.

MR VALLY: Right.

DR KNOBEL: You're talking about the companies that we considered to ...[intervention]

MR VALLY: That's right. A large number of them had as directors people who came either from the Special Operations health grouping of Special Forces or from 7th Battalion ...[intervention]

DR KNOBEL: No, no, no.

MR VALLY: I can give you names, I can give you companies.

DR KNOBEL: Yes, but what you're saying: "Special Operations" is not true. You're using that word incorrectly Mr Vally.

MR VALLY: Alright, you can correct me but the doctors who were working with Special Forces under Doctor Basson ...[intervention]

DR KNOBEL: That I accept yes.

MR VALLY: Fine. That grouping, all from 7th Battalion of the South African Medical Services or from Project Coast, they were linked at some stage or the other to Delta G or to RRL you know. Just looking at that list of mine I can tell you at least about Aromed Services, Blackdale, Blowing Rock Controlling Instruments, BR Farming Enterprises, BR Holdings, BSI Medical and Secretarial Services, BSI Medchem, or we're told it doesn't exist, let's leave that one out, Keymed Products Development, Delta G Scientific, DG's Chemic, Decotox, Global Air Charter, Healthman (Pty) Ltd, Infladel, Kowolsky International, Joostenberg Properties, John Truter Financial Consultants, Lifestyle Management (Pty) Ltd, Lifestyle Management Properties, Mason de Medchem, which we were told was a boutique but we later found out it was something else, Medchem Consolidated Investments, Medchem Pharmaceuticals, Medchem Sports International, Midrand Consolidated Investments, Partners in Travel (Pty) Ltd, Poltec Pollutions, Pollution Technologies, Pretocon(?), Pretoria Street Investments, ...[intervention]

DR KNOBEL: Mr Vally, sorry to interrupt.

MR VALLY: Certainly.

DR KNOBEL: I asked you just now if I could to TRC10 and that is exactly why I did so because I knew you were going to talk about this list.


DR KNOBEL: And I'm going to try - I don't know what the question is as yet, but let me just give you the background please.

MR VALLY: Could I just for the record put my list of people.


MR VALLY: And then I certainly will let you go to TRC10. Well, Roodeplaat Breeding Enterprises, Roodeplaat Research Laboratories, Technotec, Tensim Investments, Waterson Properties, Waterson Properties (Pty) Ltd - it may be the same company, Woselko Holdings, Wisdom Erf 82, Wisdom Erf 1219, Wisdom Finance, Wisdom Holdings, Wisdom Idle Winds Property. These may even be located in America but these were companies which had peoples who had dealings with aspects of Project Coast. Wisdom Liquor Centre, Wisdom Properties, Wisdom Travel (Pty) Ltd and WPW Investments Incorporated.

Now, the question - and then you can maybe use TRC10 to answer me.


MR VALLY: These were a large number of companies where individuals who were involved with Project Coast at some stage were directors of these companies and maybe you can explain this to us as to why, and we can look at TRC10.

DR KNOBEL: So your question is now Mr Vally?

MR VALLY: I'm trying to understand the linkages because all of a sudden I'm told only Delta G was a government front, yet Delta G is a wholly owned subsidiary of Medchem Technologies but Medchem Technologies wasn't a front company. I'm trying to understand this in view of the fact of a large number of these front, well, you say not front companies, but companies with directors who come from Project Coast or have some links with Project Coast.

DR KNOBEL: Yes, thank you. I will now take you to TRC10 and I would like you also to look at my documents that I've given you. There is one, I think it is in Appendix H, which was the briefing to the Minister of Defence on the 10th of August '93. First of all Mr Vally, if you look at number 10. That is a letter that has been drawn up by the Chief of Staff Finance and the person who drew it up or who is the enquiries addressee is Brigadier Koertzen. It's a letter to the Minister of Defence, 15th of February '91 and it is signed by General Liebenberg as Chief of the Defence Force and then finally approved by the Minister.

All front companies that the Defence Force established for whatever reason, and this is only one project of the Defence Force, there were other projects all front companies had to be approved by the Minister on an annual basis. And this letter that you have in front of you is the letter for 1991 and in that letter you'll see that the front companies that approval is asked for through the office of Chief of Staff Finance and signed by the Chief of the Defence Force and approved by the Minister, are the following: John Truter Financial, Roodeplaat ...[intervention]

MR VALLY: Can we just stop there for a while. John Truter Financial Consultants ...[intervention]

DR KNOBEL: You know Mr Vally, surely you're not going to give me a chance now to try and deal with your question.

MR VALLY: Very well, I just some clarity so that we can locate these companies but I'll ask it after you're finished.

DR KNOBEL: I'll do exactly what you ...[intervention]

MR VALLY: Do carry on.

DR KNOBEL: We can come back to any other question you may have but please!

MR VALLY: Go on.

DR KNOBEL: That list, from A to G were the front companies that had been approved for that year by the Minister. If you look at the bottom, paragraph 5, it says:

"During 1990 one of the previous front companies namely Delta G, has been privatised and is now no longer a front company"

So what I'm trying to explain to you is that on an annual basis, in terms of this project, we had to get approval through the office of the Chief of the Defence Force and through his Chief of Staff Finance, which is a laid down procedure within the Defence Force, to obtain approval by the Minister for front companies.

I also have a letter here which you do not have in your possession which is of the previous year, where Delta G is still included as one of the front companies, but in that year the privatisation process began to take place and the privatisation process is explained in a very lengthy letter which you do not have in your possession but which is now in the possession of the Auditor General and of OSEO, in which the Minister and the Minister of Finance approved the process that was going to be followed to privatise both Delta G initially and later on Roodeplaat and some of the others later on as well.

That led to the directors, basically the directors of those companies with a shareholding in the company, taking over the control over the company and controlling it through a holding company. What Doctor Mijburgh said yesterday was essentially true. The Medchem Technologies that he had established was the holding company as he explained.

The briefing to the Minister of Defence, Annexure H, which is now a year later in August '93, if you look at the attachment to that briefing: "Aanhangsel A", I'm giving the Minister a summary there of what the situation was with regards to front companies and I said: "This is the chronological history of each of these companies and how they developed, there is the history of Delta G:

"Founded April 1992

Plant opened Midrand '85

Company sold to employees in 1991

Last contracts finalised March '93

Final transfer of share certificates 1993"

Can you see, that reflects the process. Roodeplaat the next one:

"Roodeplaat founded in 1981

Sold to management

Final transfer 31 March

Infradel, Sefmed, D John Truter"

And that is where the list ends. Which again reflects to you which were the major or front companies that had been established with State funds.

And if you then look further it says:

"Other Companies"

And it mentions:

"Lifestyle Management, Protechnic Laboratories and Technotec"

which were private companies and that I say very clearly there:

"They were however never owned by the SADF"

Now this is why I've been trying to say to you from the start that Protechnic was a private company. I've been reflecting on this, you must understand I took over as Surgeon General in 1988, this is how it was transmitted to me, conveyed to me and I had no reason to doubt it and I reported as such to the Minister.

In view of what you've asked me and in view of the other testimony that was given here I can see that it is possible that SRD was a front company which Jan Lourens I think gave testimony to that effect, it then changed its name to Protechnic, it may still have been a front company then but at a certain stage it was taken over by van Remoortere and Zimmer and it was then a private company. And certainly when I was Surgeon General and I had to co-ordinate or manage the project I saw that as a private company. There's nothing sinister about that.

Now to come back to your question, this list that you've just started reading from with 102 names on it, I assure you the only companies on this list that were front companies were those reflected on the documents that I've now referred to you. All the others were established by individuals as explained by Doctor Mijburgh. What I think happened here is when the privatisation was taking place, when it became clear to the two main companies, we're really talking about Delta G mainly and Roodeplaat, those directors of those companies had to find another area where they could carry on with their business and they established these companies.

Let me tell you National Intelligence at the moment is conducting a full investigation into even other names that are not included on this list, and so is the office of Serious Economic Offences. They are extremely interested to see what had happened to all of these companies.

My own knowledge of them is really of such a nature that I can't give you any further information. I can simply confirm to you that none of the others on this list, except the ones I've given you on the reference, were front companies of the Defence Force.

MR VALLY: Well let's talk it through. Let's look at TRC10 first, what you've just referred us to. There was a person or is rather a person called John Truter, is there?

DR KNOBEL: That's correct.

MR VALLY: I believe he is presently in Canada or something.

DR KNOBEL: I beg your pardon?

MR VALLY: Is he presently in Canada or something?

DR KNOBEL: No, no, no, I don't know where John Truter is.


DR KNOBEL: Are you not confusing him with Erasmus?

MR VALLY: No, no.

DR KNOBEL: I may be wrong, maybe he is in Canada, I'm not sure.

MR VALLY: No, no, we're not talking about Mr and Mrs Erasmus or Doctor and Mrs Erasmus, no. Did this company, John Truter Financial Consultants have besides being a channel of money, have responsibility for any auditing or accounting of any of the front companies?

DR KNOBEL: No, Mr Vally, as I understood it an auditor was appointed by the Auditor General, an external auditor which was Mr Theron of ...[intervention]

MR VALLY: Sorry General, maybe I'll just draw your attention to the third line under (a), 2(a), we're looking at TRC10:

"Internal Audit Function and General Administration of the Project"

DR KNOBEL: Now the internal audit function referred to here is the auditing of funds that have been made available for the project and which was channelled from D John Truter to the various front companies and for that matter, to any other companies.

MR VALLY: Fine. So the issue that I'm putting forward to you is, you had a need for an internal audit, you created a company?

DR KNOBEL: Correct.

MR VALLY: Which company was paid for its services?

DR KNOBEL: That's correct.

MR VALLY: Now as I understand it, similarly whenever the was a need Doctor Wouter Basson had to fly to various parts of the world in private aircraft because of substances he was carrying, so you'd get a friendly company or you'd form a new company, is that how it worked?

DR KNOBEL: No, Sir. When you say: "you used a friendly company" ...[intervention]

MR VALLY: Defence Force, we're talking Defence Force.

DR KNOBEL: No, sorry, it didn't work that way.

MR VALLY: So why is it that most or all the companies I've mentioned to you had operatives or ex-employees who were directors of those companies, associated with Project Coast in some way or another?

DR KNOBEL: Mr Vally, I share your concern about this and this is why there is an investigation by the Office of Serious Economic Offences to this effect. If you ask me why, I'm saying to you there were old boys nets that had existed and these members were working within the front companies, they had been privatised, they went and established their own companies which they made available and which were used. There's another example which we'll come back to when ...[intervention]

MR VALLY: Fair enough. I'm pleased that you talk about this old boys network because they certainly seemed to have done very well out of the deal and I'll tell you why I say so. We've already heard Doctor Swanepoel saying that he made at least four million, possibly eight million rands from the privatisation of Roodeplaat Research Laboratories, and I want to come back to that but for me there's a couple of angles regarding the companies. First of all, the linkages to the old boys network and this old boys network is the one arising around Project Coast and before that, 7th Battalion, you would agree that there was this kind of network?

The second thing is, when there was a decision to terminate the project, the cancellation fees that were paid. Now I don't have an amount for, the money that was paid to Protechnic, do you have a figure for me?

DR KNOBEL: I don't have that figure, once again I'm sorry.

MR VALLY: Well the same document, TRC10, if you look at the attachment to it which you've referred to just now, page 9 thereof ...[intervention]

DR KNOBEL: Sorry, are you referring to ...[intervention]

MR VALLY: This is now:

"Uiters Geheim"

Letter dated 19th of August 1991, reference: Brigadier Basson, addressed to General M A Malan, Minister of Defence.


MR VALLY: Look at page 9, paragraph 44(b): A cancellation amount of thirty seven million rands in terms the unilateral cancellation of the research agreements is paid to the Medchem Group.


MR VALLY: So General Magnus Malan paid to Mijburgh, his nephew, because it's Defence Force money, or was aware that he was paid thirty seven million rands for cancellation of contracts?

DR KNOBEL: Yes, that's correct.

MR VALLY: Was this the standard pattern?

DR KNOBEL: No Mr Vally, I don't understand what you mean by: "standard pattern".

MR VALLY: I'm saying that at some stage there was a decision to terminate large aspects of Project Coast.

DR KNOBEL: That's correct.

MR VALLY: In terms of that there were a number of companies with which Project Coast activities had contracts, either Defence Force or Delta G or Roodeplaat. When you cancelled those contracts, were they all paid the cash value of the outstanding aspects of the contract?

DR KNOBEL: Only with regards to the Delta G and the Roodeplaat, those were the two main companies.

MR VALLY: Well here's Medchem getting thirty seven million rands.

DR KNOBEL: Yes, but I'm confirming what you're saying. This only occurred with the privatisation of Delta G and This is what this whole document is about.

MR VALLY: You see, Doctor Mijburgh very glibly told us he made money on the stock exchange. Here is a document which says he got thirty seven million rands paid for by the Defence Force.

DR KNOBEL: Mr Vally, I think we're over simplifying this. Clearly this is a highly complex process, so complex that the Joint Standing Committee on Public Accounts decided to ask the Auditor General to conduct a full investigation into the fairness of the privatisation process.

To the best of my knowledge that investigation has not been completed and we're now into the second year since the Joint Standing Committee on Public Accounts gave that instruction. The main role players in providing the information is the Chief of Staff Finance of the Defence Force, and I mentioned Brigadier Koertzen's name a few times already, and of course the investigation by the Office of Serious Economic Offences.

I don't know what the results of their investigation is but I think it is a bit premature now to simply deduct that Doctor Philip Mijburgh got thirty seven million. The fact is it's taking the Auditor General more than a year now to complete this investigation and to give a report in this regard to the Joint Standing Committee.

I'm certainly not in the position to give you a better explanation. It's quite true what is written here in front of you and you can see it was approved, not only by the Minister of Defence but also by the Minister of Finance.

MR VALLY: I must make it absolutely clear that we're talking about the Minister of Defence in his official capacity but this document is signed by Head of the South African Defence Force, General Liebenberg, signed by Minister Magnus Malan and signed by Minister of Finance at that stage, Barend du Plessis.

DR KNOBEL: That's correct.

MR VALLY: And are you aware of whether this was the standard practice with other companies?

DR KNOBEL: I've already answered that question. As far as ...[intervention]

MR VALLY: No, but personally, are you aware of whether it happened to any other companies?

DR KNOBEL: No, I'm not aware of any other companies, other than Delta G and Roodeplaat.

MR VALLY: Can I go further, that same document, the very last page, you'll see a diagram there, it says:

"The Medchem Group Corporate Structure: Shareholding in long-term assets"

Let's look at the right, it says:

"D J Truter Financial Consultants"


MR VALLY: Now, every now and then there's a block which says:


and I assume that's twelve million rand? Do you see that?


MR VALLY: And that goes then into Medchem Consolidated Investments. Did Medchem get a twelve million rand load from Truter Financial Consultants?

DR KNOBEL: The arrow points in the opposite direction Mr Vally.

MR VALLY: Are you saying Medchem ...[intervention]

DR KNOBEL: I'm not saying that, I'm saying the arrow on this diagram, I honestly don't know exactly what that means.

MR VALLY: You see, this document, and this is a 1991 document, signed at a very high level, talks about large amounts of money involving companies surrounding Project Coast and ultimately you were responsible for Project Coast, you were the Project Manager. At this stage in 1991 you were the manager already.

DR KNOBEL: Mr Vally, we've already established what the role was of the Surgeon General within the Co-ordinating Management Committee. I've explained to you that there were three sub-committees, one dealt with the financial aspects, one dealt with the security aspects and one dealt with the research and scientific aspects.

And I've indicated to you that in terms of the financial aspects, the Surgeon General was totally dependant on the Chief of Staff Finance to guide him along with regards to the financial management at this level. This is why this document that you have in front of you was a document of CSF, Chief of Staff Finance.

It is true that Basson is here under the: "Enquiries Column" and as I testified I think here, but also to the Office of Serious Economic Offences, the process of privatisation and commercialisation was designed between Doctor Basson and the Chief of Staff Finance and they were supported by the Attorney General's office, I beg your pardon, by the State Attorneys as well as by the Auditor General's office. And that is the subject of the Office of Serious Economic Offences investigation which is being conducted now. It is also the subject of the Auditor General's investigation into the fairness or the correctness of the privatisation process. I can't give you any further information.

MR VALLY: Alright. Just for the record, besides the thirty seven million rands there's also talk of a further fifteen million rands being channelled, and I'm talking about an option referred to in paragraph 43, sub-paragraph (b):

"Financially the process will result in the nett cash flow to the Medchem Group of fifteen million rands"


MR VALLY: And that appears to be in addition to the thirty seven million rands we talked about earlier.

DR KNOBEL: It appears like that. I'm saying again I think we're possibly over simplifying it.

MR VALLY: And we have this young doctor straight from 7th Battalion, Director of Medchem, subsequently director of Delta G, who in fact, if this is to be believed, this document signed by the various Ministers, made a massive financial killing in 1991 already. Can we assume that from this document?

DR KNOBEL: I don't know what we can assume Mr Vally, I'm sorry.

MR VALLY: Well, let's go on.

DR RANDERA: General, can I ask at what stage did you become aware of the involvement of all these doctors from 7th Medical Battalion in all these other companies? I'm not talking about the front companies because they were set up with the various committees that you've described already, but this list that Mr Vally has just provided to you.

DR KNOBEL: Yes, Doctor ..[intervention]

DR RANDERA: Have you only become aware since the investigation started or was there a period prior to that?

DR KNOBEL: Doctor Randera, in 1991, I think we've dealt here with the Counter Intelligence Report on one or two occasions, signed by General van der Westhuizen. I can't remember which document it was but it was one of the bundle, where I made the testimony that a Counter Intelligence Report was drawn up by the staff of the Chief of Staff Intelligence. In that document you will see one or two or three of these other companies are investigated, I think Aeromed was one.

I certainly knew in 1991 that there was an investigation into the so-called Aeromed Services, on the basis that there were links with members of the Project Coast. After that investigation had been completed I was assured that there was no criminal activities discovered and that the case was closed. From then onwards I had no further knowledge until I received the first letter from the Offices of Serious Economic Offences in January '93, which is in my bundle here and you will also see what my reply was to that. In that letter from the Offices of Serious Economic Offences, there are also a number of these additional companies mentioned. We can go to it if you like but I don't waste time, but not nearly as many as we have on the list now.

The next step was when we started working closely with National Intelligence. I explained already how that had taken place and when I began to link up with National Intelligence, not necessarily Mr Mike Kennedy but some of his other colleagues assisted me in helping the Office of Serious Economic Offences in trying to unravel what the position was here.

I must admit that it was only last year when I visited the offices of National Intelligence that I became aware of a document which I happen to have here, on companies associated or linked in some or other way to Project Coast. I haven't actually checked it now against this list of Mr Vally, but I believe it is even more than the 102 that are on this list.


MR VALLY: Thank you Mr Chair.

I need to ask you some further questions on the minutes of the meeting, Annexure J, of the 29th of March 1994, the control committee.

DR KNOBEL: Yes, Sir.

MR VALLY: We've determined that the optical discs we're talking about in paragraph 3 were the discs on which all the formulae etc., had to be recorded. Now did you at any stage inspect these discs to see what is on there?

DR KNOBEL: No, Sir. Let me try and give you the background there. There are, as far as I can remember, 13 CD Rom optic discs in the safe. After the technical information was transferred from documents onto the discs, the discs were brought to me by Colonel Ben Steyn in a safe. I established that the discs were inside the safe, and as far as I remember there's also an additional floppy along with it, which is the access mechanism, access coding that you require to be able to access the information on the discs.

It was then put into a very large wall safe attached to my office and my headquarters and only Colonel Steyn and I had control, joint control over the small safe, smaller safe, the portable safe. After the demarche and particularly after the Americans and the British expressed concern about the safety of the information on the discs, I went to see Mr de Klerk and I followed it up with a letter and that letter I can give you a copy of. It was in April 1994.

At that stage we changed the joint control in such a way that all three of us, the President, Mr de Klerk, Colonel Steyn and myself had to be present in order to access or to be able to open the small safe. The position was then changed, it was then changed to a safe in a different part of my headquarters, a huge safe with two keys and a combination and the small safe with its two keys was put into the bigger safe.

And in that joint control we gave the President one of the keys of the big safe as well as the combination of the big safe. I kept the key of the big safe and one of the keys of the small safe. Colonel Steyn had the combination of the big safe and the other key of the small safe, and that was how that situation was maintained.

The discs were never accessed, although we recommended to the previous government and to the present government, particularly with regards to the investigation of both the d'Oliviera Commission as well as of the Offices of Serious Economic Offences, that at some or other time we would have to access the information on those discs.

After the withdrawal of Mr de Klerk from the government of national unity obviously the situation changed. Let me just say this, after we briefed Mr Mandela in August '94 and explained the security measures to him, he indicated that we should maintain it as it is at that time.

In other words that Mr de Klerk should still retain his part of the control. But when Mr, and I beg your pardon, when Mr Mandela met the overseas delegation from the USA and the UK, the whole question of the security of that information was again discussed with them and they expressed their approval of the system which was in place and it was maintained exactly in that way. And then when Mr de Klerk withdrew from the government of national unity, I indicated to him that he would have to give up his part of the control and hand it over to either Mr Mandela or Mr Mbeki. That ultimately took place and at the present time the control is exactly the same with present Surgeon General having the position that I had, with Colonel Steyn still being in the office there as the past Project Officer and still the expert on chemical and biological defence and I believe Mr Mbeki now has the further control.

But the answer to your question is, the information has not been accessed ever, although may I just add this, when we discovered or when the trunks were discovered with information on it, a lot of files on it, the files that we are dealing with at the moment, both National Intelligence and I recommended strongly to government that we should access the information, because if we access that information we can then deal with what was the official project programme as I've been describing it to you up to now and what was outside that programme. I believe we will be able to determine that.

MR VALLY: To the best of your knowledge, have these discs ever been checked?


MR VALLY: So, ...[intervention]

DR KNOBEL: Well, I don't know what you mean by: "checked".

MR VALLY: Well, has any person with scientific knowledge accessed these discs and looked what is on them?

DR KNOBEL: I've answered that question Mr Vally.

MR VALLY: Is the answer: "No"?

DR KNOBEL: Of course not.

MR VALLY: So there may be a lot of nonsense on there for all we know?

DR KNOBEL: You're asking me to speculate Mr Vally.

MR VALLY: Sure. I accept that. But if you look at, we're still busy with Annexure J and I'm looking at the minutes of the meeting of the Co-ordinating Committee of the 24th of January 1994.


MR VALLY: If you look at paragraph 5(c), it's J4 for the Commissioners.

DR KNOBEL: I'm sorry, just that date again please?

MR VALLY: Sorry, it's the minutes of the Co-ordinating Committee meeting of the 24th of January 1994.

DR KNOBEL: Yes, I've got it, thank you.

MR VALLY: Our reference is J4. Look at 5(c).


MR VALLY: It says:

"Surgeon General must ensure that all relevant information has been loaded correctly on the discs and that all technical documents have been destroyed"

It appears that you were given an instruction to acquaint yourself with what is on the discs. Am I misreading it?

DR KNOBEL: No, no, that is certainly not what is meant there.

MR VALLY: Can you explain to us what is meant there?

DR KNOBEL: What is meant was I had to enquire from the previous Project Officer who was involved in placing the data onto the discs, that he had in fact placed all the technical information on the discs ...[intervention]

MR VALLY: Well, let's talk names. So, all you had to do was ask Brigadier Basson: "Brigadier Basson, did you put all the information on the discs"?

DR KNOBEL: All the technical information.

MR VALLY: All the technical information?

DR KNOBEL: That's correct.

MR VALLY: And that's what you did?


MR VALLY: And he said he'd done that?

DR KNOBEL: He in fact confirmed that at a meeting of the Co-ordinating Management Committee.

MR VALLY: So Brigadier Basson was the person who was ultimately in possession of the knowledge of whether the relevant information had been put on the discs or not?

DR KNOBEL: That's correct.

MR VALLY: And the company that was given the contract to capture this information on discs, that was Data Information Images?

DR KNOBEL: No, I think Data Images Information Systems.

MR VALLY: Data Images Information Systems.

DR KNOBEL: Yes, you're quite right Mr Vally. I may just mention that the company that had carried out this task, as far as I could establish afterwards, was given a contract by D John Truter in 1991, to establish a data base for the project.

The decision that all the technical information of those two companies, we're talking mainly about Delta G and Roodeplaat, that that should be put on discs was confirmed by Mr Louw, the Minister of Defence in January '93. The company had already had a contract. I was not even aware which company was involved but the work had been done, it took almost a year for it to be completed. You see we are here dealing with a minute of January '94 so that's a year later.

When the trunks were discovered and I was invited by National Intelligence along with Colonel Steyn to come an evaluate the contents of the trunks, I immediately realised that those trunks contained most of the research, technical information of research carried out at Roodeplaat. There was some of Delta G but you will agree with me it's mainly Roodeplaat work. And my first question was, these are the documents that were supposed to have been destroyed and which we had reported here that all technical documents had been destroyed.

And that was when I started asking questions of National Intelligence and I can confirm that in June last year, the trunks were discovered February/March last year, in June last year when we were discussing the technical information on the documents vis-a-vis the technical information that was supposed to be on the discs, that I was informed by National Intelligence that this was in fact done by Data Imaging Information Services. That was the first time I realised that it was this particular company.

MR VALLY: So the factual situation is that we have - you've been referred to as both optical discs and CD rom, put together by Brigadier Wouter Basson. The company which had the contract was the one where Dr Mijburgh, I think he said he was the sole director, he may have had one other director, and subsequently, to the best of your knowledge, no-one has ever checked those discs?

MR KNOBEL: No, you're right. I can give you additional information, a member of the South African Medical Service was seconded for this task and that was a - I believe a Dr Kobus Bothma. He was fully seconded to help with placing the information on the CD roms.

MR VALLY: Did you get any report from him?

MR KNOBEL: No, he's left the country.

MR VALLY: Is he also in Canada at the moment?

MR KNOBEL: I believe so.

MR VALLY: The fact is that we know that Brigadier Basson advised you that he had destroyed all the technical documents.

MR KNOBEL: Absolutely. He also does at a Co-ordinating Management Committee meeting.

MR VALLY: And the fact is that we know he lied.

MR KNOBEL: Yes, that's true.

MR VALLY: So he may have lied about lots of other things?

MR KNOBEL: That's also true.


DR RANDERA: General, I think I'm coming back to a point I've dealt with you already, but can I - I'm trying to understand the situation. You've sold off all these companies, we're dealing with incredibly sensitive material, material that you haven't even cast you eyes on,


DR RANDERA: Any it still - the contract still goes to a private company. My first question is, was there no capability within either the Intelligence Services or the Military Services to be putting that information on, and following from that, does it not open, again coming back, we're not dealing with material of minutes of a meeting, we're dealing with material that the country wants to protect at all,

MR KNOBEL: Yes, I agree.

DR RANDERA: And yet it's given to a company, a private company, I presume all the individuals who work within that company don't have to go through lie-detector tests and everything else that Intelligence Agency people go through. Can you try and make me understand ...(intervention)

MR VALLY: Sorry, Dr Randera, I just want to add to your question, just a little bit, and the evidence we received yesterday, was the equipment which was used to place this information on disc was in fact supplied by the Defence Force as well.

MR KNOBEL: Yes, but the way I understood it, Dr Randera, to answer you question, is that the person who actually dealt with the documentation was either Brigadier Basson personally, who understood the contents, and this Dr Kobus Bothma that we had seconded for the purpose. So, as I understood it, nobody else had any access to the information that was on the documents.

DR RANDERA: But you don't know?

MR KNOBEL: I don't know.

DR RANDERA: You don't, I mean I just need the truth of the matter.

MR KNOBEL: Yes, that is the truth.

DR RANDERA: That's speculation.

MR KNOBEL: That is true. No, but it's not only - it's not speculation truly, it is how it was reported to us, but you are right, we don't really know. It was reported as such to us.

DR RANDERA: My first question, was that capability not there within, you're using the people from, in your own words, you're using Brigadier Basson and Dr Bothma, who are military people already, you're providing the computer services or the computers, and yet it goes to a private company.

MR KNOBEL: Yes, again Dr Randera, I can't answer that question other than saying to you that the contract had been placed with this company already in '91 according to the documentation that we found, contractual documentation, which is now in the possession of the Office of Serious Economic Offences, and it was a contract that had already been in existence and this work was then done there. And it was approved by the Co-ordinating Management Committee, and it was reported back to them.

CHAIRPERSON: Advocate Potgieter?

MR POTGIETER: Thank you, Chair. Dr Knobel, I'm not quite clear, can you perhaps just try and be as explicit as you can in explaining to us, what did you actually do to comply with this duty that the "Beheerkomitee" Control Committee placed on you in terms of this minute J4 of the 24th of January 1994, paragraph 5(c),

"The Surgeon-General must satisfy himself that all relevant information has been correctly loaded onto the discs"

and the rest of it, all technical documentation was destroyed. What exactly did you do?

MR KNOBEL: Right, advocate Potgieter, we're talking about January '94. On the 31st of March '93 Dr Basson was retired and placed on pension and placed on the Citizen Force Reserve, and with the direction of the Chief of Defence Force, was used in his Citizen Force capacity to continue the termination and privatisation of some of the companies, to try and recover the funds in Croatia, and also to complete the task of placing the technical information on discs. That had been approved by the Chief of Defence Force. He worked on that for a full year, until we get to this meeting where we're now saying the data has not all been placed on discs. The new project officer was Colonel Steyn. Colonel Steyn had to liaise direct with Brigadier Basson and with Dr Kobus Bothma who we seconded to help him with the task, in order to keep me informed. You see at those minutes Colonel Steyn reports that it has been completed in the first paragraph, and I'm then given an instruction to determine whether it was done correctly and that all technical documents had been destroyed.


MR KNOBEL: I then interviewed Dr Basson in this regard and I said I want to know exactly what you did. He explained to me that they had gone through only the technical or the scientific information of the two companies in great detail and had placed it on discs, and that it was now fully present on the discs. I did not then proceed to try and access the information on the discs and try and establish by looking at documents and comparing what was on the discs, and actually going through the entire process again, which would probably take another year. I'm saying to you that there were 13 CD rom discs which, if you take the full capacity of them would be an enormous amount of information. I was satisfied that the technical information of the two companies were fully placed on disc.

The second thing that I had to do, was I had to determine whether the technical documentation was then destroyed. I had an undertaking from Dr Basson this was so, and I took the precaution of asking him to come to the next Co-ordinating Management Committee meeting where he could confirm that himself. I explained that at the next meeting and it was so noted.

DR RANDERA: So the concern was basically just in regard to satisfying yourself, "vergewis homself" that all relevant information was correctly captured on these discs. So are you saying that in giving effect to this, you had this interview with Dr Basson?

MR KNOBEL: Correct, and Colonel Steyn was present as well.

DR RANDERA: Alright, and Dr Basson made a report to you?


DR RANDERA: Which really was to the effect that, yes, Dr Knobel, I've done it correctly?

MR KNOBEL: Yes, sir.

DR RANDERA: And that was it?


DR RANDERA: And that's where we stand at this stage today?

MR KNOBEL: Correct, yes.

DR RANDERA: Do you think that is a satisfactory situation that pertains now, if I may ask you?

MR KNOBEL: No, obviously with hindsight now I will consider that one should have possibly gone through all those discs. Our problem, advocate Potgieter is this, that both Colonel Steyn and I could have gone through the entire process of accessing all the information and insisting that none of the files should be destroyed until such a time as we had gone through it, which would have taken a full year at least again. And of course, remembering that neither of us had the same chemical background that Brigadier Basson had, there was nobody else in the country that we could find or could ask to come and help us do this job, there was just simply nobody available.

CHAIRPERSON: Did you really try and find somebody who could have been competent?


CHAIRPERSON: I mean you have being singing praises to Peter Falck throughout this whole period. Did you really find out, did you make an audit of people who could have been available for ...(intervention)

MR KNOBEL: I did not have the authority to do that, no, Mr Chairman.

CHAIRPERSON: There was - you see, I think the problem we are faced with, General, with all due respect, is that there seems to be a laxness with which this whole thing was approached, you know. Almost as though to say, it's just a job, that's the one view. The other view of course, and which gives rise to a lot of speculation by a number of people who will hear these proceedings, is that there was collusion, and I'm sure you would really like to place yourself in a position where we shouldn't come to that conclusion, and I'm not even beginning to suggest that we are coming to that conclusion. It's just that we are totally dissatisfied to see that people who had been placed with a very heavy responsibility to make sure that if there is a winding up of a company, it's done properly, if things have to be destroyed, they must be destroyed properly. That you seem to take the word of your colleague, yes, I have taken hold of those things, Dr, I have done that, I have done what you said I must do. You do not see to it that in fact it had been done.

MR KNOBEL: Mr Chairman, there were also other independent members of the Medical Service present in this process, both Dr Bothma and Colonel Steyn.

MR POTGIETER: Dr Knobel, I don't want to use the description of Mr Vally about the value of those discs, those 13 discs, but is it fair the say that for all we know, we have 13 discs which don't really reflect the entire scope of this particular project and that they might very well be in circulation elsewhere, in the possession of others, the full information around the project, and that what the authorities are sitting with at this stage is really just a watered down - hoping that Mr Vally's words are not proved correct?

MR KNOBEL: Advocate Potgieter, I have said already, I think that's speculative. I think there's only one way of determining what you are saying is possible or not, and that is to access the information, and I have recommended that to the previous Government and the present Government, and particularly after the trunks were found. And National Intelligence can confirm this, we've actually on more that one occasion indicated, and in fact I discussed this quite recently with the Deputy President, and said that we need to access the information on the discs. I believe that that will clarify a lot of issues reflecting to that now.

MR POTGIETER: Yes, I - can I just say in conclusion again, one doesn't want to apportion any blame or nothing, but I think that, you know, you can understand this sort of alarm that this raises in one's mind, especially for us sitting here dealing with this topic, and seeing the potential that is locked up in all of this work that you have been engaged in, the absolute alarm in hearing this sort of thing, but as I say, I mean, it's not an attempt to apportion any blame or nothing, we're here to try and save the day. But thank you.


MS ORR: This isn't a question, but addendum to Advocate Potgieter's conclusion, and that is that yes, we should access the discs, but so doing will not show us where the gaps are, because the only person who seems to have complete knowledge of the programme is Dr Basson and I don't think he's likely to tell us what has been left out. And accessing the discs will not tell us whether or not that information has been made available to other countries, and I think we are all very concerned and alarmed, and I agree that this is speculation, but at the possibility that these kinds of things may indeed be the case.

CHAIRPERSON: Do you agree Dr Knobel that here our concern is in fact well-founded.

MR KNOBEL: What is true, Mr Chairman, is that those discs were handed over at this date, and from that date onwards they have not been available to anybody, that is true. We don't know if the information on the contents of the trunks were made available to anybody else, we have the assurance that it was not.

CHAIRPERSON: We hear so many things that took place ...(intervention)

MR KNOBEL: Yes, I know we hear a lot of things, Mr Chairman.

CHAIRPERSON: There are places here which are supposed to be like Fort Knox, NIA Headquarters, and things disappear, computers, cars, what have you, if we are to believe what we read in the newspapers. So I am not - you are saying yourself that since those discs where placed where they were, nobody seems to have had access to them, in spite of your ...(indistinct)

MR KNOBEL: That is correct, and we discussed it with out American and British colleagues and they were satisfied, and so was the previous President, and so is the present Government, and they have maintained it in exactly that fashion.

CHAIRPERSON: I don't want to talk ill about friendly countries, because that's what they are, but I mean they are countries which have got their own agendas, but I'll leave it at that.

MR KNOBEL: No but that I agree with, we're in full agreement about that, Mr Chairman.


DR RANDERA: General, just one last question, and this, it relates to this issue of the only person who had knowledge of what was going on within the front companies was Dr Basson. Now during this hearing we've had very eminent scientists coming and speaking, the very people who were actually - Dr Basson was not a Microbiologist at the end of the day. Was there every any thought given to the posing the question that, let's go to the actual people who were the heads of the various departments, the Dr van Rensburgs, the Dr Immelmans, to ask them - even Dr Steyn, I mean yes, he's the project co-ordinator now, Dr Basson was a project co-ordinator. But was there ever any thought given to that idea, to bring a team of people, I'm talking about at the time, because they were really the individuals who knew. When Dr - it's a question I'm going to come back to later on in terms of the fertility programme - you know, Dr Basson knew nothing about that, let's be honest about it. Yes he's a chemist, but he knew nothing about what the lady doctor was doing within that programme. Now that would have been the sort of cross-checking I suppose that we would have expected, and that's what our concern is about at the moment. Now was there any thought at that time, besides giving it to Dr Bothma and Dr Steyn and Dr Basson, to bring these very eminent individuals in. Let's leave Professor Falck out, he wasn't even part of your thinking at the time.

MR KNOBEL: Dr Randera, I'm trying to answer you question. The project started in 1981. The system and the way it was co-ordinated and controlled was established from then onwards. By 1988 that system was working and was running with good security and it was handed over to me as a successful way of conducting the project. In other words, for 8 years it had run that fashion. I was briefed and I asked the question, have we achieved out objectives and I was satisfied that we had. I immediately said, in that case we can now begin the following process, namely the process of privatising, commercialising, normalising and looking after these scientists. We had a large number of very eminent scientists, as you correctly say, that we had to look after. I explained - I think you heard what I said yesterday, that I was initially opposed and I was told that we cannot terminate it at that stage. I was in favour of the fact that it could be not terminated, but scaled-down to the level where the maintenance of the capability could be maintained. That only took place about two years later when it was agreed that now the process of privatisation and commercialisation could take place.

So within three years of me taking over as Surgeon-General, this is where we are now. I'm saying again, with the wisdom of hindsight it might have been a good idea to do what you are suggesting. But let me just say something else to you, within those years, the eight years and the three years, a number of our staff that were associated with the project became knowledgeable. One of them was Dr Brian Davie. Dr Brian Davie fulfilled the role as the technical advisor to myself for a while, but because of the important role that he was beginning to play in support of foreign affairs and in support of the development of a Non-proliferation Council, the beginnings of the new act, Non-proliferation Act. He was very quickly scooped up as it were by the Organisation for the Prevention of Chemical Weapons, where he is today, working as a director. He was one of the persons who could have been a great help. The minute he was scooped up by the OPCW, Colonel Steyn was the next one that stepped into that position. And today I am sitting with exactly the same situation, or rather the present Surgeon-General is sitting with the same situation. At the very moment Colonel Steyn is in Geneva attending the conference of the Biological Weapons Convention in support of foreign affairs and giving advice to them as to the working papers, as to the friend of the chair meetings, as to the resolutions that South Africa is submitting. We have only two people that really would be in the position to help us, all the others as has been pointed out here by Mr Vally, has resigned from the Defence Force, has been embroiled in other companies or has left the country, and as he correctly says, some of them have gone to Canada.


MR VALLY: General Knobel, in your submission, and I've brought it to your attention a few times, but let me just state again, page 9 you say, and I quote,

MR KNOBEL: Are you now talking about ...(intervention)

MR VALLY: Your personal submission to us.

MR KNOBEL: The affidavit?

MR VALLY: Your statement, yes.


MR VALLY: "During February 1994 it was a abundantly clear to both the Minister and myself that there were definite indications that Dr Basson had acted outside the mandate of the project and had probably abused capabilities that had been researched and developed in the project. This impression was further strengthened by the detailed document of the US and UK governments, dated 11th of April 1994."

Now, that's February 1994, and you're very concerned about Dr Basson's credibility. You know that your knowledge of what was or was not put on the discs came from Dr Basson. But if you look at J5, which is the minutes of the Co-ordinating Committee of the 9th of January 1995, under the paragraph 3 where it says "Datavaslegging" with reference, I assume, to the optical discs that you talked about. It says "afgehandel", concluded. My question is, because you became aware and were concerned about the role played by Dr Basson, didn't you think it was necessary to re-visit the issue of what he had told you he had put onto the discs?

MR KNOBEL: Mr Vally, remember this is a - in fact this was the final Co-ordinating Management Committee, it didn't have a function any further. With regards to the project, that component had been completed. By this time the discussion about the documents and about the control over them and about the demarche and about the position of Dr Basson was at the level of Government. I have said to you that we discussed this after the briefing I had from National Intelligence, along with Mr Coetzee, we discussed it during the demarche with the President, with the Chief of the Defence Force at that time, General Meiring, and with the Minister. That was already in February '94. After the election we had to wait quite a while before they had the opportunity to brief Mr Mandela and Mr Mbeki and Mr Modise, Mr Kasrils, that had been done in August '94. At that stage both I myself and Mr Mike Kennedy as you see from his own affidavit had regular meetings with the President and the Deputy President together and separately, and we had discussions, some of which were formal discussions of which minutes were produced, some were informal discussions. And the main issue then, as I explained in my affidavit, was to deal with the demarche because this had international relations implications and proliferation implications, and to deal with Basson separately. And we did, we did - at that meeting when I briefed President Mandela, we discussed the position of Dr Basson personally, and at that point we had agreed, both I and National Intelligence informed President Mandela, in front of President De Klerk that his initial dismissal founded on or based on the Steyn Report, was in fact an unfair dismissal, he had never been charged with anything, he'd never been given a chance to give an explanation. He should have been given that opportunity, or he should have been placed in a position where he could be questioned properly. The only persons who had any dealing with Basson directly was myself and Mr Kennedy of National Intelligence. And on the basis of what he said to the President they had agreed to satisfy the concerns of the Americans and the British, to re-apply him on permanent basis. For that we had to apply to the Commission for Administration to do that, because a person who is on pension cannot just simply be taken back on a permanent appointment. The Commission for Administration took almost a year before they acceded to our recommendation - in fact Mr Mbeki personally had to go and see the Commission for Administration in order to be able to get him re-appointed.

So concerned were they about the control over Dr Basson, over his movements and so on. But the point that I'm trying to make, Mr Vally, is all of us, I put it in my affidavit, at that point everything I knew, everything that I was concerned about was shared with the President and the Minister and the Chief of Defence Force. It was not any longer at the level of a Co-ordinating Management Committee to make a decision. So from the point of view of what they could have done at this which turned out to be the last meeting, was nothing, it was rather at the level of the Chief of Defence Force, the Minister and the President.

MR VALLY: Well, let's look at annexure J3, the minutes of the Co-ordinating Committee meeting of the 2nd of December 1994. If you look at paragraph 3 there, on the 2nd of December 1994 this Co-ordinating Committee again approves payment ...(intervention)

MR KNOBEL: Just hang on a second.

MR VALLY: Sorry, I beg your pardon.

MR KNOBEL: I'm not - yes, I've got it, thank you.

MR VALLY: 2nd of December 1994, paragraph 3, it says, Brigadier Basson's claim in respect of travel and living expenses was discussed, he explained that he had to travel business class because he had to make travel arrangements at short notice and the meeting accepted as reasonable his claim of R240 000. This is now 2nd of December 1994, a further R240 000 is paid to him.


MR VALLY: Any documentation provided by him?

MR KNOBEL: Yes, there is documentation which I believe is still available and which has been made available to the Office of Serious Economic Offences.

MR VALLY: Because there is no reference to it here in this meeting.

MR KNOBEL: No but it was available, I assure you, the travelling documents and so on, they still have it.

MR VALLY: So the R240 000 for travelling and living expenses is justified?

MR KNOBEL: No, sir, no, no, no, this refers to the document that you showed me the other day about the 75 000 US Dollar loan from Passload Flights, do you remember, we discussed it then?

MR VALLY: You see there - yes, we did talk about it, that's TRC 28.

MR KNOBEL: Which were expenses incurred somewhat earlier that the date referred to.

MR VALLY: But that was 7th of May 1994, and that had to do with 75 000 US Dollars that had been advanced to him.


MR VALLY: And he was justifying the bribes ...(intervention) MR KNOBEL: That had to be paid back though.

MR VALLY: ... in Chad and bribes in Cameroon, etc. Again no documentation there. This R250 000 seems to be different, this is a claim for R250 000 as opposed to TRC 28, 7th of May 1994 which was a justification for 75 000 US Dollars which had been paid in advance to him.

MR KNOBEL: Which had to be paid back though.

MR VALLY: Well, no, he did have to pay it back, but he said he spent it.

MR KNOBEL: Mr Vally, the question that you're asking is that at this date in December '94 we are still approving money being paid.

MR VALLY: Large sums of money.

MR KNOBEL: Yes, that's true, but the point is, in January - I beg your pardon, in March '93 when he went onto pension, he was kept involved in the project in a part-time capacity as a Citizen Force Officer to clarify certain issues around the Croatian transaction as well as accounts that had to be closed in Europe, which he was the only person that had signatory rights, etc, etc, and that was approved by the Chief of Defence Force. And all the expenses that had been incurred during that period, as well as the expenses that had been incurred when he had to appear in court in Switzerland, etc, were reflected, as far as I can recall, at this meeting. Again if you will see the Chief of Staff Finance and Brigadier Koertzen was asked to attend this meeting because they were the persons who knew the details of the financial aspects and had to advise the Committee on it.

As far as I can recall, this is what this refers to and again I assure you that the expenses that he incurred and the documentation to that effect is still in existence. Those are the only documents that have not been destroyed, are financial documents. In terms of the Companies Act you cannot destroy financial documents, and there are 14 trunks of D John Truter's financial documents that have been made available to the Office of Serious Economic Offences in order to help them unravel this.

CHAIRPERSON: This should be a convenient stage for us to take a tea adjournment, Mr Valley.

MR VALLY: Could I just put one thing on record before we take the tea adjournment, Mr Chair. General Knobel, in your affidavit to you us you did ask us to call Mr Mike Kennedy. He has subsequently submitted an affidavit to us, I understand that you are satisfied with the contents of the affidavit. Do you still require him to be called?

MR KNOBEL: I would certainly like that affidavit to be read into the record, Mr Vally.

MR VALLY: You want the entire affidavit to be read into the record, or to be taken as - as given as forming part of the record.

MR KNOBEL: No, if I may request that it be read in, it's not a long document, it can be read in very quickly.

MR VALLY: We'll ask the Chairperson to consider that over tea and then when we return from tea you can tell us whether Mr Mike Kennedy should ...(indistinct) Thank you, General Knobel.

MR KNOBEL: Thank you.

CHAIRPERSON: We'll adjourn until 11h00.



NEIL KNOBEL: (s.u.o)

CHAIRPERSON: General Knobel, you are reminded that you are still under oath. Dr Randera would like to make a follow-up question on what we have been dealing with.

DR RANDERA: General, I just want to go back to the minutes of those last meetings that you held where it was reported that all the information had been put on discs by Brigadier Basson. At the time - of course the minutes reflect the points that were made by the Brigadier and you've said already that that was accepted as such. But was there any discussion that took place at the time, I mean given the concerns that we've expressed already and some of the information you had at your disposal at the time in 1994, was there any discussion that took place within the Committee that's not reflected within the minutes about any of these concerns, or was it just accepted by everybody?

MR KNOBEL: Dr Randera, it's difficult to remember you know exactly what had been discussed, but you must understand that at these minutes the Chairman was General Meiring. The - I'm not entirely sure, apart from Dr Steyn who obviously was also fairly well informed, the other members at these meetings, like General Pretorius for example, had just been newly appointed as Chief of the Army, he didn't really have the background of all the events. Certainly Vice-Admiral Malherbe, late - I'm talking about January '94, are we at '95 or '94?


MR KNOBEL: '94. Malherbe had just been appointed as the new Chief of Staff, Finance, he didn't really have the - or rather new Chief of Staff, Logistics. He didn't have background about the project, he had just been appointed, he was really a one meeting man virtually. Mr van Heerden who was there from the Auditor-General's office, he certainly had been, as far as I know, been involved with the project right from the beginning, and certainly was very closely involved with the Office of Serious Economic Offences investigation, and as the Auditor-General's own investigation in terms of the Joint Standing Committee on public accounts. So within that Committee there were really two or three of us who had full background information and knew that there were investigations going on, that there was a question mark, certainly as far as financial management was concerned, and the possible financial abuses. General Meiring was present at the meeting with the State President, Mr Coetzee in the demarche in February in - where my comments on the American report was tabled and so, so clearly he had exactly the same information that I had, I had kept him up to date. In my affidavit I arranged for him to also be seen - or also to see myself and Mr Mike Kennedy, and that happened in '94, but also in '95, '96, later on. We had regular meetings in which he was brought up to date with the latest developments, developments with regard to where we stood with the various investigations, where we stood with the re-appointment of Basson, what new information, if any, was available at National Intelligence level, and so on.

But now the point that I'm trying to make is, you're asking me to discuss it. Certainly I've been reflecting about this. The minute that it is minuted that I now have to verify whether the discs contained all the information, I would clearly say to the Chief of the Defence Force, are you now expecting me to access all the information, to get somebody else who is an expect, who could look at the documentation and ensure that what is written on the document is now technically - the technical information is now all on the disc and is correct and the formula correct and so on. It would be an impossible task to perform, it would be a task which would take a year. I'm sure that that sort of thing was said.

DR RANDERA: General, the only - I suppose what I'm trying to understand is, are we asking questions that may be unfair to you?

MR KNOBEL: That's the nicest question I've ever ...(intervention)

DR RANDERA: You know, we're looking at this issue four years later, which isn't that long ago, let's be honest, issues of great concern in 1993 already, I think you've said yourself that there'd been concern expressed. Besides the - I mean let's take away the financial aspects, but Brigadier Basson had been travelling to various countries in the employment of ...(indistinct) had raised these issues with different people, and I suppose what I'm asking is, did any of these people, whether it be General Meiring, whether it be the Financial Controller, did they ask the question, you know, are we just accepting, here's a person - quite justifiably in terms of his control and his understanding from 1981, are we not giving too much power to this one individual in terms of what's on the tapes?

MR KNOBEL: Dr Randera, you're quite right, I don't think the questions are unfair, and in your position I would ask the same type of questions, but let me say this, you're quite right - before I became Surgeon-General in 1987 I raised my first concern to General Geldenhuys with the fact that I became aware of the fact that Wouter Basson was getting instructions, not related to the project necessarily, but just in the broadest possible way, getting instructions and acting as an advisor to other Commanding Officers, to other organisations, even at the Departments without the knowledge, the apparent knowledge of the Surgeon-General. I raised that in 1987. When I became Surgeon-General I again put that question to them, and I've already testified to that. So you're right, clearly it disturbed me that there was not sufficient control.

May I, if you will allow me to say to you, it is at the present time still a major problem. The - my successor says the same to me, he says, I don't have control over people under my command, they are being seen directly by, and he names all sorts of people. And I say to him, now you will understand the position that I found myself in.

Now when we come to conclusions of this hearing, I think the one thing that stands out, is that the dilemma we had with this highly technical type project, which requires a detailed knowledge of chemistry, and as you pointed out, also of other fields like Microbiology and Toxicology, etc, that you end up totally relying on one individual who has a lot of freedom of movement and has the support not only of his own Commander or channel of command, but also of other command channels. That is the dilemma. I really don't know how one overcomes that, how - you know it's not a good thing to run a project through a Committee in any case, in my opinion, it's better to have a one person responsibility, but because of the complexity, both on the financial side, both from the security side and of the scientific side, this is how it was constructed and I can assure you, if you come in as a new Commanding Officer of an arm of service, and you inherit a system which is believed to work and which is believed to succeed, it's virtually impossible to change that.

DR RANDERA: Thank you, Mr Chairperson.


MR VALLY: Thank you, Mr Chair. Mr Chairperson, I just enquire as to when you want to get Mr Mike Kennedy's affidavit read into the record.

CHAIRPERSON: I will consider that as soon as you are through with General Knobel, then we can take his affidavit.

MR VALLY: Alright, because there may be something that General Knobel wants to refer to in Mr Kennedy's affidavit, but he can indicate to us if that's the case.

MR KNOBEL: Yes, Mr Chairman, that is in fact true, I was originally considering to ask you at the end of the questions, unless a question would come up which would be addressed in that affidavit, but my only request would be that you do allow Mr Kennedy to read that into the record at least.

CHAIRPERSON: Yes, I think we should play it that way, Mr Vally, because I wouldn't like to interpose his evidence with that of Mr Kennedy.

MR VALLY: Thank you, Mr Chair. General Knobel, we're still looking at the 24th of January 1994 minute. I have two further questions on that minute, this is the Co-ordinating Committee minutes.

MR KNOBEL: Yes, thank you.

MR VALLY: Paragraph 3, the second sentence, it says something about the South African Narcotics Bureau investigating the dealing in controlled substances and that a report has been forwarded to the Attorney-General whose reaction is awaited. Can you tell us what this was about?

MR KNOBEL: You asked me that question earlier, Mr Vally.

MR VALLY: Yes, I'd asked you the first part about the monsters, the samples, this is the second part.

MR KNOBEL: No but you see I explained to you in my testimony earlier, it was this morning or was it yesterday, that clearly the handling of restricted substances was open to possible criminal charges.

MR VALLY: I'm sorry General Knobel, you did deal with it at that level.


MR VALLY: What I should do is put to you, was there at this stage a suggestion or an investigation into the illegal dealing in restricted drugs?

MR KNOBEL: No, not as far as I know.

MR VALLY: Fine. The same document, paragraph 5(e), it talks about certain hardware will not be made available now and will maybe made available if needed, what's the hardware being referred to there?

MR KNOBEL: Mr Vally, I'm not a computer expert, but the information on the CD roms, the technology available to access that information is explained in a floppy which is contained inside the small safe, and the hardware that you require to access that information is what is being referred to here.

MR VALLY: Thanks. Alright, let's go on to annexure I, I just have a few questions there. Let me first refer you to paragraph 52 of a document drafted by you, dated 24 September 1993.

MR KNOBEL: Yes, I've got it.

MR VALLY: Do you have that?

MR KNOBEL: Yes, thank you.

MR VALLY: In paragraph 52, the last sentence, it appears as if you're saying there that from the 1st of March 1988 you had personal control, or you exercised personal control over Brigadier Basson and you confirmed his appointment as Director of Research and Development in your Head Office on the 1st of October 1988. Would that be the position, even subsequent to that with the operation of Project Coast, that you exercised personal control over Brigadier Basson?

MR KNOBEL: No, Mr Vally, I'd already explained I think also to Dr Randera's question, that I was concerned in '87 when I became aware of the fact that he was being utilised in a consultant role by all sorts of persons, as I've indicated also in this document, without the Surgeon-General being informed or being requested or being asked whether his services could be made available. Now I'm appointed the Surgeon-General, at that time he was still under operation control of Special Forces, and I wanted to rectify that position, or at least improve the situation to such an extent that I would have more direct control over him, so I transferred him back, after all he was under command of the Surgeon-General, the terminology in Army command terms is the command affiliation which existed before I became Surgeon-General was he was under command of the Surgeon-General, but under operational control of Special Forces. That is a military term. I changed that command affiliation by saying, I'm not transferring you back from Special Forces to my Headquarters so that I would have more direct control over you. But the position that he occupied, Director of Research and Development was not only pertaining to this project, that was only one project that he was involved in, it also meant all other deployments of the Medical Service, particularly the employments of Seventh Medical Battalion Group as a quick reaction force. Any other research, any other developments within the Medical Service, whether it was pharmaceutical companies who came to do clinical trials at our Military Hospitals, or whatever the case may be, he would co-ordinate that and would control that. Any - that type - any research of our veterinary science components in the Kruger National Park with regards to the ...(indistinct) which Professor Hofmeyer gave us a lot of information about. Maybe you don't know it, but in our Kruger National Park we have a very serious threat to our animal population with tuberculosis and foot and mouth disease, and things like that, and we have veterinary officers deployed there to support the Department of ...(intervention)

MR VALLY: General Knobel, just, sorry ...(intervention)

MR KNOBEL: ... we did all of that work and I had more direct control over it.

MR VALLY: Alright and did it refer to also the time when he was the project officer of Project Coast?

MR KNOBEL: No, sir, Project Coast was still run exactly as I explained to you before. It is written in this document and is explained in this document in the further paragraphs following.

MR VALLY: Fine. Let's just move on to paragraph 53.


MR VALLY: You say that Brigadier Basson was accountable to the Co-ordinating Committee for the management and development of the project.

MR KNOBEL: And the running of the project.

MR VALLY: Running of the project, I beg your pardon. That includes research, development and production, and his activities were approved by that body. The situation regarding the operational application of products delivered by the project was different or separate.

MR KNOBEL: That's correct.

MR VALLY: In this regard Brigadier Basson was tasked by the user or the person who gave the orders.

MR KNOBEL: That's correct.

MR VALLY: And his activities are authorised by the person who gave the orders, and then you say the persons who gave orders were the following,

MR KNOBEL: That's correct.

MR VALLY: Have I interpreted that vaguely correctly.

MR KNOBEL: Yes, I must say vaguely, it's not particularly clearly put here. Mr Vally, Brigadier Basson was considered the expert on the utilisation of CR.

MR VALLY: Right.

MR KNOBEL: CR is the product that I'm referring to here. If you go back through the history that was really the final product that we ended up with because we had already then stopped the research on incapacitating agents, destroyed it and so on.

MR VALLY: Let me just understand this, you're saying certain aspects relating to the project are under the authority of the Co-ordinating Committee?


MR VALLY: You are saying in respect of, and the word is operational usage, "aanwending"?

MR KNOBEL: That's correct, usage.

MR VALLY: Of the products developed, or "gelewer" developed by the project.


MR VALLY: The authorisation for those aspects would be by whoever gave him the order or the instruction?


MR VALLY: Now this is what I'm trying to get clarity on, and then you say the people who gave the instructions were the following, and you've got from (a) to (g). Let's look at (g) first, Director-General: National Intelligence Service, now that was, I assume, Dr Neels Barnard.

MR KNOBEL: Yes, I believe so, no, but here maybe we should get the advice from National Intelligence Agency.

MR VALLY: Well however it was ...(intervention)

MR KNOBEL: It was Neels Barnard to begin with, and I think later on it was Mr Louw is it not, I think so.

MR VALLY: Yes. Whoever it was, I mean National Intelligence Service would give instructions about usage of CR gas?

MR KNOBEL: I honestly don't know Mr Vally, all I know is that the Minister had indicated that this man was the national authority on the usage of anti-riot agents and anybody who wanted to - any of these members who wanted to have his advice or his - wanted to have ...(intervention)

MR VALLY: His products.

MR KNOBEL: ... products, or were given the products by the Defence Force and wanted to have advice on how to utilise it, he was the person to advise, that's what I'm trying to say.

MR VALLY: So from what this says, the NIS could have given him direct order or obtained information or products from him?

MR KNOBEL: Yes, I don't think it would happened exactly that way, I think they would have asked him to advise them about the use of and how to obtain it and he would give them the necessary guidelines and they would then follow the inter-departmental route of getting the permission from the Chief of Defence Force or from the Minister and he would be the technical advisor.

MR VALLY: No, but this is the very point, I mean, you introduction makes it clear that the authorisation to Dr Wouter Basson would be obtained from these very people, and then you've got the Minister of Defence, you've got the Head of the Army ...(intervention)

MR KNOBEL: No, no, Head of the Defence Force.

MR VALLY: Head of Defence Force, I beg your pardon, the General Commanding Special Forces, the Chief of Intelligence, the Commissioner of South African Police, the General Commanding of South African Police, Security Branch,


MR VALLY: And you've got the Director-General, National Intelligence Service.

MR KNOBEL: Yes, correct.

MR VALLY: And what you are saying is,

"die situasie het tot of verband die operasionele aanwending van produkte gelewer deur die projek was egter anders", it was different, "in die opsig is Brigadier Basson getaak deur die gebruiker of the opdraggewer ...(intervention)

MR KNOBEL: Yes, what I am trying to say is, within that environment ...(intervention)

MR VALLY: Yes, but now - sorry let me just finish that last sentence,

"and in his conduct by the person giving the instructions he was authorised to do so."

MR KNOBEL: I'm saying within that particular environment any activities that he performed in that environment, in the Police environment or in National Intelligence environment, was obviously approved by the Head of that particular department, that's what I am trying to say here.

MR VALLY: So ...(intervention)

MR KNOBEL: And I'm saying again to you, in my knowledge, this was the use of CR, or the potential use of CR.

MR VALLY: This is what confuses me because why would the Security Branch, or why would National Intelligence Service, or why would the Minister of Defence be obtaining CR from him? Surely the Minister of Defence will come to you?

MR KNOBEL: Mr Vally, I have no idea why National Intelligence would want to use CR.

MR VALLY: If I was to put to you, based on what you say in this paragraph, that the poisons, anthrax in the cigarettes or cyanide in whisky or whatever, was what was envisaged ...(intervention)

MR KNOBEL: By myself?

MR VALLY: No, by authorising these individuals to directly authorise ...(intervention)

MR KNOBEL: I cannot answer that and I think I'd be speculating.

MR VALLY: No, but did they have the requisite authority to do so?

MR KNOBEL: No, I'm not saying that.

MR VALLY: Without having to go through the Co-ordinating Committee, because this was a separate issue?

MR KNOBEL: No, I cannot answer that, Mr Vally. I've put down here the way I experienced this and what I was concerned about, and I have said in the next paragraph or on the bottom half of that paragraph, I was unhappy with the situation and I complained about it and I said I did not like it. I thought that if any need was required for CR by for example the Security Police, the right person - I was in possession of the CR, it was on my stores and had to be protected and maintained by myself, and if anybody needed it they could come to me for it. Or if it had been weaponised as it was in Project Academic - not Project Academic - we had the same problem the other day, remember, when we spoke about those two.


MR KNOBEL: But ...(intervention)

MR VALLY: Project Black?

MR KNOBEL: No, no, not Black, but you know the one I mean.


MR KNOBEL: I can go back and look it up, but anyway the project where the Army weaponised CR and put it into rifle grenades, etc, etc, you remember that?


MR KNOBEL: Those items would be under control of the Chief of the Army, and that would have to be the liaison channel. But the problem is, they didn't go directly to the Chief of the Army to access CR hand-grenades or whatever the case may be, they came directly to Basson.

MR VALLY: There's no reference to CR in this particular paragraph.

MR KNOBEL: But it's the only operational product that we had at that stage.

MR VALLY: Than you were aware of?

MR KNOBEL: That I was aware of, of course.

MR VALLY: And that's the issue I'm raising with you, that there may have been operational products which you were not aware of, which for example the Head of the Security Branch had the authority to directly access ...(intervention)

MR KNOBEL: It's misleading to say that I am saying he had the authority to directly utilise that, that's not what I mean here. I'm saying that any activity of Basson within the environment of that particular department or section was under the control of that sectional head, and I was unhappy about that.

MR VALLY: Alright, just that same document, the annexure thereto, annexure A, which is the ...(intervention)

MR KNOBEL: It's the same annexure that I gave you just now with regards to the Minister ...(intervention)

MR VALLY: That is correct, yes.


MR VALLY: Now, you've got Delta G Scientific, established 1982,

MR KNOBEL: Yes. Opened in Midrand '85.

MR VALLY: Opened in Midrand in 1985, sold to management and employees 1991. Last contract March 1993. Final handing over of "aandeelsertifikate", share certificates, 31st of March 1993. I want to touch on this whole issue for the last time, this issue of front companies. When people were appointed directors of these front companies, I heard them telling us that they signed blank transfer of share certificates, do you recall that?

MR KNOBEL: Yes, I know that they testified to that.

MR VALLY: Alright. I also have been given to understand, and you can tell us which companies it was applicable to, but first of all, when the companies were sold to whoever, and there have been disputes about who should have got shares and who didn't get shares, you - and I say you in your capacity as the person responsible for the companies as Surgeon-General because of Project Coast, or the Co-ordinating Committee. Let's call it a Co-ordinating Committee.

MR KNOBEL: Yes, I would prefer it, yes.

MR VALLY: The problem is, the Co-ordinating Committee only met once a year as far as I understand, unless there were special meetings.

MR KNOBEL: No, there were special meetings. The pattern that you see in the minutes that I still have in my possession and that I've not given to you indicates that there was usually a meeting at the beginning of the year, which there was the planning for the year meeting, but there was also a meeting towards the end of the year in which the budget of the following year was being determined. And I said that these last few meetings were relating how to finally terminate and privatise the companies.

MR VALLY: So what would happen is that the remaining contract, with elements of the Defence Force, whoever, if they were cancelled, the company would be paid out? The employees would buy the company, or the management would buy the company. Thereafter were any of these companies re-sold to the Government at a profit?

MR KNOBEL: Not that I'm aware of, no. The only company that was bought, as you say, by Government, was Protechnic that had been taken over by Armscor.

MR VALLY: I think we heard evidence to the effect that something similar happened with RRL.

MR KNOBEL: Oh, I beg you pardon, sorry, Mr Vally, you're quite right, the - I wasn't thinking - I was thinking in terms of Defence Force taking control over a company again. You're quite right, RRL, - the, is it agricultural services, I believe so, and of course the breeding farm was taken over by ...(indistinct) service, the breeding component.

MR VALLY: So there may have been situations where ...(intervention)

MR KNOBEL: But you're saying at a profit, I honestly don't know, I don't know about those transactions.

MR VALLY: Okay. The final set of documents I want to go through with you are set out in annexure G. This is headed "The chronological development in relation to the Croatian transactions". There are a number of issues that are of concern here, and let me just take you through some of the aspects. If you look at paragraph 3, you are saying in paragraph - sorry, I'm looking at - do you have the document.

MR KNOBEL: Yes, I have it in front of me.

MR VALLY: Alright. Paragraph 3 says originally products and weapons were developed which included all three classes, and you name them as those which were irritants, those which were incapacitants and those which were toxic - lethal would be a better word.

MR KNOBEL: Yes, that's right.

MR VALLY: Now, can you explain to us what was meant by this, that there were products or weapons which were being developed in terms of Project Coast which were potentially lethal.

MR KNOBEL: If you will give me just one minute, Mr Vally. I did say at the beginning of the hearing that I wanted to refer to the TRC briefing that I gave in January '97, do you have that document, I'm not sure of the ...(intervention)

MR VALLY: We do have it, please go ahead.

MR KNOBEL: Yes. In that document this situation is exactly explained where details are given about the initial so-called implementation phase - I'm just getting the exact page and I'll tell you. If you page to page 25 under "Chemicals Weapons Research" I say,

"The chemical research development and production facility, Delta G Scientific was commissioned in '85. It operated as a private company, it was fully integrated in chemical community where it operated undercover successfully till the programme was stopped."

Paragraph 39,

"Chemical agents were categorised as lethal, incapacitating and irritating agents."

Under paragraph 40,

"Lethal agents, these agents were considered to be those that had been developed exclusively for use as lethal chemical agents in weapons of war. It was apparent at a very early stage of our research, but there was no sense in trying to develop and study molecules that were more toxic that those already known in the field. Those molecules were an adequate deterrent even though they had been around for many years. What was important is that new delivery and penetration enhancement techniques have made protection against these agents vastly more difficult. Following philosophy regarding these agents was developed and implemented. All known molecules in this group would be synthesised on lab scale. This was followed by confirmatory investigation of the chemical and toxicological properties of the molecules. Further research would be done on the various penetration enhancement techniques applied to these molecules. All substances in the above findings will be made available to the Defensive Equipment Research Programme and no weaponisation would be implemented for any of these."

I think I give you more details of that later on, let me just make sure. Yes, ...(intervention)

MR VALLY: General Knobel, so what you are saying is that you did in fact work on lethal agents but you didn't develop them further.

MR KNOBEL: We didn't weaponise them.

MR VAN ZYL: You didn't weaponise them?

MR KNOBEL: No, we didn't.

MR VALLY: Fine, let's just go on. Paragraph 8, the same document, where it was decided to accelerate the project,

MR KNOBEL: That's correct.

MR VALLY: And there's reference to a 6,6 million South African Rands in order to obtain items I believe from overseas?


MR VALLY: Now I'm trying to understand why this is happening because you're trying to do it before the end of 1992. We know that in January '93, and I refer you to paragraph 38 where the Minister of Defence on the 2nd of January 1993 gave an instruction that all incapacitating agents, including "voorloperstowwe", I'm not sure what gasses those are,

MR KNOBEL: Ground substances.

MR VALLY: Ground substances, and this sort of weaponry must be destroyed?


MR VALLY: Was this acceleration of the project in anticipation of that instruction?

MR KNOBEL: No, it was in anticipation of the signing of the new Chemical Weapons Convention which was eminent, which was going to take place in January '93.

MR VALLY: So why would the be an acceleration of that project to acquire substances which you would have to destroy the very next month or the next year?

MR KNOBEL: The development of the incapacitating agents at that stage were considered as dual-use chemicals, I explained that earlier this morning, but it would also be utilised in an anti-riot capacity. The use of an anti-riot agent certainly - the only exception being BZ is not addressed by the Chemical Weapons Convention.

MR VALLY: Well we know that Cr, if you use it outside the country, you must notify the controlling body.

MR KNOBEL: Yes, but you don't have anti-riot situations outside the country.

MR VALLY: That's the point. The point is you were allowed to use it within the country. But you do have to declare it though.

MR VALLY: Well, we'll come back to that aspect again, but now ...(intervention)

MR KNOBEL: But you must also - Vally, you must remember we are anticipating here what is going to happen with regards to the Chemical Weapons Convention. As I've said to you already, we initially thought that the Convention was going to be signed earlier possibly, but we also thought that it might take a lot sorter for the gratification to take place. The Convention was signed in January '93. We anticipated that we would have two years before it would be ratified and then enter into force. So that gave us quite a bit of time - leeway. And in our discussion with Minister at the meeting in January '93, that appears in the discussion. If you go back to that document you'll see that we've discussed it detail. In fact it took a lot longer for the Convention to be ratified and ultimately it entered into force in April '97 last year. And please remember this, I've tried to explain it to you, we were in the process of moving South African troops out of Angola and out of Namibia. Namibia was becoming independent, the Cubans were withdrawing, we were hoping that we would negotiate a settlement between Savimbi and Netha. And the Defence Force said to Government, this means only one thing, that now we will have to work up towards a negotiated settlement in South Africa, which is what happened - which is exactly what happened.

MR VALLY: Which is why I'm asking with reference to paragraph 8, why was the project accelerated?

MR KNOBEL: To deal with mass-action in South Africa, that was the emphasis, where shifting from a retaliatory capability to dealing with riot situations, and we did have at that time the various emergencies being declared.

MR VALLY: Just - whilst you're talking about the Chemical Weapons Convention, South Africa had some time before that been declared to be a chemical weapons state by the United States I believe. Are you aware of that?

MR KNOBEL: No, sir, I know that at the '89 meeting a declaration - or rather a document was made available about the so-called chemical weapon capable countries and the industrial countries that possibly had that capability, and South Africa was part of that.

MR VALLY: Alright, going on with this document, paragraph 13, it talks about when the project officer, and I assume we're still talking about Brigadier Basson at this stage?

MR KNOBEL: Yes. This is a chronological layout of what had happened prior to the Croatian ...(intervention)

MR VALLY: Right, what I understand - arranged in certain aspects which are of interest. He went to Moscow where he met people involved the area of chemical warfare and he met amongst others a group of Croatians.

MR KNOBEL: This is what he says here.

MR VALLY: Alright. Sorry this - is this his document or your document?

MR KNOBEL: Mr Vally, I testified to you before and in my affidavit I indicated to you that I had spoken to them - I had insisted to brief the Minister immediately about the programme when I learned that the money in Croatia had been lost or there was a problem.

MR VALLY: Right.

MR KNOBEL: And I indicated to you that I then had a meeting with the Minister and he said, I want a document which sets out the chronology of what had occurred.

MR VALLY: Right.

MR KNOBEL: And Brigadier Basson was asked to draw up such a document, and this is the document that you have in front of you.

MR VALLY: Fine. Well let's go on. Paragraph 14, it says with the acceleration of the project and the budget cuts it wasn't possible for the project management to manufacture all the chemical products locally and they had to look for sources outside South Africa.

MR KNOBEL: That's correct.

MR VALLY: From what I understood, you were worried about the quality of the methaqualone rather than the fact that you couldn't access it internally or manufacture it internally.

MR KNOBEL: Certainly quality was also a factor, but these factors were organised.

MR VALLY: But that's not a issue for Dr Basson, his ...(intervention)

MR KNOBEL: He's not mentioning it here, Mr Vally.

MR VALLY: That's right.

MR KNOBEL: I'm telling you the quality was one of the issues.

MR VALLY: I see, fair enough, but the point to note is, Dr Basson hasn't said that.


MR VALLY: In September 1992 he says there was already dealings with a group of Croatians in ...(intervention)

MR KNOBEL: Can I just - sorry, Mr Vally.


MR KNOBEL: With regards to your remark just now, if you look at paragraph 16 you will see that he says there the 500 kilograms of substance M, he did sampling of it, he did an analysis of he then said if the analysis is satisfactory he would then pay for it. That deals with quality.

MR VALLY: Sure, I've got not problems with that.

MR KNOBEL: I'm just trying to say that he does mention it.

MR VALLY: We'll come back to that paragraph. So he meets with a group of Croatians and he says the leader of this group of Croatians was a Minister of Energy Affairs of Croatia, a Mr Kagfeg and it also had representatives from the Croatian Military the Croatian Boarder Guard and the Croatian Security Police and a Special Forces Unit of Croatia.

MR KNOBEL: That's correct.

MR VALLY: There's an agreement to buy 500 kilograms of substance M, and we now know that's Methaqualone.


MR VALLY: And which would be supplied on the following conditions,

(a) there'll be a sample of the substance given to the project officer, Dr Basson, and thereafter the containers would be sealed;

(b) that he would test the substance in Switzerland; and

(c) that if he's happy with the test he would pay for the substance in the sum of 4600 US Dollars per kilogram or - between 4600 and 5000 US Dollars per kilogram and then he would arrange delivery either by air from Zagreb, which he would arrange himself, or by road from a safe area, either an Austrian or Slovakian border.

This is all done by Brigadier Basson.

MR KNOBEL: Yes, sir.

MR VALLY: You have no personal knowledge of it other than what Brigadier Basson told you?

MR KNOBEL: That's correct.

MR VALLY: It may be fantasy, it may be fact.

MR KNOBEL: Do you want me to speculate?

MR VALLY: No, I'm putting to you. Do you have independent evidence that this happened?

MR KNOBEL: No, apart from the fact that you read earlier on that I had a meeting with Mr Reggley who was the Intelligence Head of the Swiss Defence Force, and you also have the two communications that I received from Jacomet, who was the agent.

MR VALLY: We're going to come to those. In any event, there was a problem regarding the payment guarantees, for want of a better phrase, "betalingvoorwaardes". The four parties involved, and I assume that's the people referred to above, all the various elements of the Croatian Armed Forces and Security Branch, etc, allegedly did not trust each other and therefor there were no normal exchange of letters of credit I assume, which could be used for the payment of these substances.

MR KNOBEL: That's correct.

MR VALLY: Was this an illegal transaction in Croatia?

MR KNOBEL: I have not idea.

MR VALLY: I mean we had the Minister of Energy Affairs involved, why weren't normal channels used to pay?

MR KNOBEL: Mr Vally, I have no idea.


MR KNOBEL: I think from what you have in front of you, those parties that took part in this clearly didn't want to have it being done in the open or through normal channels as you suggest, according to this document.

MR VALLY: So he then says that arrangements would be made with bank Indoswiss in Geneva to provide letters of guarantee. Is that correct?

MR KNOBEL: That's what he says, yes.

MR VALLY: Well, was this done?

MR KNOBEL: Yes, sir.

MR VALLY: Did we put money in the bank in Geneva to cover the guarantees?


MR VALLY: And thereafter, after the successful delivery and payment you would arrange with the bank in Geneva to cancel the guarantees?

MR KNOBEL: Correct, and that money would then be refunded to South Africa.

MR VALLY: That's correct. So we're talking about potentially two large amounts of money.


MR VALLY: One would be cash to be paid to them and the other one to be paid in a bank to cover the guarantees.

MR KNOBEL: Correct.

MR VALLY: And payments would be made through an agent.

MR KNOBEL: That's right.

MR VALLY: And I assume that is Dr Jacomet?

MR KNOBEL: That's the other man, yes.

MR VALLY: Alright. He goes on to say he was happy with the quality and because the Airport in Zagreb was closed it was taken to Austria and from there I assume it was flown into South Africa. He doesn't say further about what happened to the items, the 500 kilograms.

MR KNOBEL: Yes, to the best of my knowledge that did come to South Africa.

MR VALLY: Fine. Then he talked about the transfer of the funds to a Captain Jurg Jacomet, who he says is also involved in Swiss Intelligence.


MR VALLY: And this happened on the 6th of November 1992.

MR KNOBEL: Yes, according to ...(intervention)

MR VALLY: Any idea how these funds were transferred?

MR KNOBEL: No idea.

MR VALLY: Any idea where he got the money from, this is now Brigadier Basson? We're talking, and it says so, a sum of 2 million 300 000 US Dollars.

MR KNOBEL: Yes, this was project funds that had been transferred from D Johan Truter to the bank in Switzerland for use by Basson.

MR VALLY: So what we're in fact talking is double this amount, we're talking 4 million 600 000 Dollars.

MR KNOBEL: No I don't follow that.

MR VALLY: And I'll tell you why. We're talking about the funds which had to be deposited in the bank in Geneva to cover the letters of guarantee.

MR KNOBEL: That's correct.

MR VALLY: And we're talking about the money which went to the agent, who was Dr Jacomet.

MR KNOBEL: Which was the cash payment of 2,3.

MR VALLY: Yes, so there are two amounts involved.

MR KNOBEL: Yes, that's correct.

MR VALLY: So we're talking 4 million 600 000 Dollars, US Dollars. And all this money went through Truter you say, Truter Financial Consultants?

MR KNOBEL: As all other funds of the projects of Delta.

MR VALLY: And this properly audited as far as you know?

MR KNOBEL: Yes, as far as I know, and he's still now part of the investigation of the Office of Serious Economic Offences.

MR VALLY: Now would Truter give that 2 million 300 000 US Dollars directly to Dr Wouter Basson, or would he transfer it - would the company transfer it themselves to Dr Jacomet's account in ...(indistinct)

MR KNOBEL: No, it would be under control of Dr Basson.

MR VALLY: So in some form or the other Dr Wouter Basson, is he given the full 4 million 600 000 US Dollars?

MR KNOBEL: Yes, of course.

MR VALLY: And no documentation, you accept that he would be doing what he said he's doing?

MR KNOBEL: No, there is documentation. All the documentation with regards to this transaction has been made available - all the existing documentation, let me put it that way, has been available to the ...(indistinct)

MR VALLY: Do you have a deposit slip from the bank in Geneva?

MR KNOBEL: Mr Vally, please,

MR VALLY: Well have you ever seen a deposit slip from the bank in Geneva?

MR KNOBEL: No I haven't, but I assure you the Office of Serious Economic Offences has been investigating this now, along with all other allegations, for almost 6 years. Please call one of them to give you that answer. I assure you, whatever was in our possession, whatever was in the offices of D John Truter has been made available to them, totally.

MR VALLY: Alright, paragraph 22, two parties got the money it says amounting to 790 000 US Dollars.

MR KNOBEL: Yes, and consequently the bank guarantees were released and the money was returned to South Africa out of the bank.

MR VALLY: In that sum?


MR VALLY: Not the full sum?

MR KNOBEL: No, because you only have those two parties agreeing that they have been paid their amount.

MR VALLY: Fine. The guarantees were given separately - there were separate letters of guarantee or was it a globular sum?

MR KNOBEL: No, the four parties insisted that they each have a separate letter of guarantee.

MR VALLY: Alright. Brigadier Basson says at this stage he lost contact with the Croatian parties and also with Captain Jacomet. He visited Zagreb in January 1993, he couldn't get hold of these individuals. In February he determined that the third government officials and Captain Jacomet were arrested in connection with some doubtful transactions where Minister Kagfeg was involved, is this the Minister of Energy Affairs of Croatia?


CHAIRPERSON: Mr Vally do you have any indication how long you are going to still be on this issue?

MR VALLY: Yes, on this issue ...(intervention)

CHAIRPERSON: I am determined that by lunch time we should have completed taking evidence from everybody and that includes Mr Kennedy and that cross-examination, re-examination, everything should have been done. We must make our choices now, it's now 12h00 and we have got one hour within which to wrap up everything.

MR VALLY: I'm sure that we will finish by that time, Mr Chair.

CHAIRPERSON: Well I only need more that just the assurance, at the rate at which you are going I don't - but I can't dictate to you how you should conduct, as long as you know by 13h00 everybody else will have done what they have to do, which means that you should have taken Mr Kennedy by 12h30 so that we have at least half an hour for re-examination by other counsel. I just felt it would be fair for you to be able to know that you have to do some economy of time.

MR VALLY: I not that, Mr Chair. Let's go on, General Knobel. General - Brigadier Basson makes a number of trips in this period to Croatia as we know. Now, there's something strange in paragraph 29, and I'm trying to understand this. During his visits he's told by someone from Danish Intelligence that him and Brigadier Basson together got hold of barabonds in the some of 40 million US Dollars and these barabonds are allegedly provided by the Vatican to the Croatian Government for the purchase of weapons, and it is intercepted by the said Danish person and the project officer which is Brigadier Basson. What was this all about?

MR KNOBEL: Mr Vally, you have in front of you the same information that I was given and that the Minister was given. This is what we were told and this is what he put in writing.

MR VALLY: Did you ever enquire what was happening?

MR KNOBEL: Enquire from whom?

MR VALLY: From Brigadier Basson.

MR KNOBEL: Of course I did.

MR VALLY: And what did he say?

MR KNOBEL: He said this is what had happened.

MR VALLY: That him and a Danish agent intercepted 40 million US Dollars of Vatican barabonds which they were going to use to buy arms in Croatia?

MR KNOBEL: Yes, that the Vatican was being using to buy arms in Croatia.

MR VALLY: That's right.

MR KNOBEL: Yes, that's correct.

MR VALLY: And how did this involve the Methaqualone?

MR KNOBEL: No, no, this had nothing to do with Methaqualone, this was trying ...(intervention)

MR VALLY: I'm trying to understand how it's connected.

MR KNOBEL: This was going to be a method of forcing the Croatian Government to pay out the money that was owed by the Minister of Energy Affairs.

MR VALLY: I see, so what we're saying is that Brigadier Basson was hanging onto these 40 million US Dollars of barabonds from the Vatican to blackmail the Croatian Government to pay back the money that they had of his?

MR KNOBEL: Yes, that is what he is saying, in fact.

MR VALLY: I see. And so what was Brigadier Basson arrested for in Switzerland?

MR KNOBEL: For presenting these bonds for payment and it was then discovered that he was not entitled to the bonds, by the Swiss Government.

MR VALLY: This 40 million US Dollars of their ...(intervention)

MR KNOBEL: That is how I understood it and that was what he was arrested for, and that is what he had to appear in court for.

MR VALLY: And did he have authorisation to try and cash these Vatican bonds?

MR KNOBEL: I don't know Mr Vally. What you have in front of you, Mr Vally, if I can try and save time, is this is the chronology of events that he was asked to draw up and this is the document that served in front of the Minister and I myself and the Chief of Defence Force was there as well.

You see he says in paragraph 32 he had an authorisation letter where he got the ownership of those documents - exactly what that letter is I don't know, I haven't seen it. And then they tried to exchange it ...(intervention)

MR VALLY: There's a reference to a further 5 million US Dollars in paragraph 32.


MR VALLY: Do you know what that is all about?

MR KNOBEL: No, he says that was the face-value of those bonds if I understand it correctly.

MR VALLY: Which bonds are we talking about now, the Vatican bonds?


MR VALLY: But I thought that was 40 million US Dollars.

MR KNOBEL: I know, Mr Vally, I read this too, but that is what he says there, the face-value. He possibly had some of those bonds he had an authorisation letter or he managed to obtain it. But clearly this is the type of information that only one person can give us and that is Dr Basson himself.

MR VALLY: Well the question for me to you is that this man is dealing with public funds, you know, he's been given 4 million 600 000 US Dollars coming out of our Treasury and absolute control over this money. He's running to Croatia, he's the sole person who makes the imports, no-one had any other information ...[intervention]

DR KNOBEL: Mr Vally, but at this stage there was no reason to doubt that he was able to deal with that. He had been doing it for the previous 10 years, all the funds of the project.

MR VALLY: Well, you know OSEO was asking questions about this issue since 1991.

DR KNOBEL: No, Sir, I'm sorry, you are not correct.

MR VALLY: Alright.

DR KNOBEL: The OSEO's letter to me was addressed to me on the 8th of December 1992 and I received it in January '93.

MR VALLY: Fair enough.

DR KNOBEL: Well it is not only fair enough, it's incorrect what you were saying, it was not from '91.

MR VALLY: Alright.

DR KNOBEL: It was from the end of '92. It makes a difference.

MR VALLY: Well you know, I don't want to go back especially since I'm under time pressure but we're talking about trips that he was making in 1993 to Croatia, to Switzerland ...[intervention]

DR KNOBEL: No, I beg your pardon, to try and recover the funds that had been lost during this process.

MR VALLY: But he's arrested for having other bearer bonds, at least 5 million US dollars, maybe 40 million US dollars and this happens in that period?

DR KNOBEL: That's correct.

MR VALLY: Were you just approved R250 000 at the Co-ordinating Committee for his travel?

DR KNOBEL: No, we haven't just approved it, it was long before.

MR VALLY: Oh, we approved it subsequently but it was paid for?

DR KNOBEL: Yes, but the money was still owing to the agent who gave us the methaqualone. But Mr Vally, really quite honestly, don't you think that if we have an investigation of the Office of Serious Economic Offences who is going into all the details, who has got all the documents for D John Truter, who's had access to all the bank accounts and has been overseas now for two years investigating this, it would be better for us to leave it with them to unravel this? I certainly cannot give you anymore information than what was written on this document and that was presented by him in my presence and General Meiring's presence to the Minister of Defence.

CHAIRPERSON: I never felt myself more in agreement with General Knobel than with what he has stated. Certainly if it is for our benefit as the panel, I don't think we are going to come anywhere near understanding this thing any fuller than we have understood. I have understood from the very beginning that Basson was flying around the continent of the world with large sums of money for projects that had nothing to do with the project that he was supposed officially to be doing. And I think that point does not get enhanced by anymore detail about whether the money was from the Vatican or from bearer bonds or from anything else. It is here, it has been canvassed, and I think with great respect, we should move on. Sensationally yes, it makes all the difference that the Pope and everybody else was part of this whole insidious thing but I don't think we are making any point further Mr Vally.

MR VALLY: Mr Chairman, let me make my point there?

CHAIRPERSON: Please do Mr Vally.

MR VALLY: Thank you Mr Chairman.

I refer you to the affidavit of Mr Jacomet, it's G3.


MR VALLY: According to Jacomet, and I'm talking about paragraph 1, 2, 3, 4:

"I have never entered into any agreement either verbally or in writing with Doctor Basson to receive any fiscal compensation for my services rendered in this transaction"

I refer to going to up to paragraph 2:

"I did not enter into any agreement whatsoever with Doctor Basson or any other party either verbally or in writing with regard to delivery of the said substances"

Now we're talking about a man who has been given cash US dollars of 2.3 million US dollars, no documents, nothing in writing, cash is given to Doctor Basson, allegedly Doctor Jacomet receives this cash.

I refer you to the bottom of that same page of the affidavit:

"The money was transferred to my bank account. I received a telephone call from Doctor Basson, just a telephone call. He instructed me to payments in cash of 450 000 US dollars each to two certain individuals in Zagreb"

And then he says some individuals would approach him, they'd give him certain codes and he'd give them the cash. He gave the money to individuals whose names were not known to him. Now was this the standard procedure, that as far as you know, I mean he's been operating like this for 10 years?

DR KNOBEL: No, certainly this was not the standard procedure but this was an exceptional case. But Mr Vally, I'm trying also to gain some time, this deposition was made in August '94 in Bonn. At this stage Jacomet is searched by the Swiss authorities, nobody can trace him at the moment, why he made this statement and how truthful the statement is, I honestly don't know and how reliable it is. I'm giving it to you in this document simply to show you about the chronology of events and how it effected my position with regards to Basson. I don't know whether this has any value, all of the has been made available to OSEO and they are investigating it and I would really say let's leave them to solve this problem.

MR VALLY: Alright. The final point I want to make is that money, according to his affidavit, money is put in his account and part of the problem is he mixes it with his private funds and that's why the money isn't(?) cashed according to him.


MR VALLY: He gives out cash to individuals after a telephone call from Doctor Basson saying payout people who come with certain codes.

DR KNOBEL: The two remaining agents or the remaining parties.

MR VALLY: Whoever they may be.


MR VALLY: People arrive there, give him the codes, he pays them, he doesn't know who they are ...[intervention]

DR KNOBEL: He says he doesn't know it ...[intervention]

MR VALLY: He says so, yes.

DR KNOBEL: He says so but I'm not sure if that is true or not.

MR VALLY: Again, it's State funds. This is how Brigadier Basson is operating. What worries me is the Co-ordinating Committee, and I assume up to ministerial level, are finally satisfied with these explanations, from the documents we've been through.

DR KNOBEL: No, I'm afraid that's not quite true. The result of this is that all of this has been handed over to the Offices of Serious Economic Offences. Efforts have been made through our Foreign Affairs Office to recover some of the funds. You know what the situation is Croatia like, there's no ways that you can make any progress along those lines, we've tried. And we have not closed the book on this yet.

MR VALLY: OSEO may be busy with it but the Co-ordinating Committee minutes clearly indicate that it's agreed the money is lost, we're writing it off.

DR KNOBEL: No, Mr Vally, I indicated to them that: "I'm afraid it seems to me the money is lost", but we haven't given up that case, at least it wasn't given up after the project had been closed down.

MR VALLY: Alright. Let's just conclude with me putting the following issue to you General Knobel, you were aware of the mandrax and ecstasy programmes to be ...[intervention]

DR KNOBEL: Mr Vally, I corrected you earlier on, I was not aware of a mandrax or an ecstasy programme.

MR VALLY: Alright.

DR KNOBEL: I had only approved, along with the Co-ordinating Management Committee, the study and the research and the development of certain incapacitating agents which were analogues or derivatives of methaqualone and of that other formula which we discussed yesterday, which you say was ecstasy and which ...[intervention]

MR VALLY: Well, let me help you, you were perfectly aware that General Neethling had given 200 000 mandrax tables for the purposes ...[intervention]

DR KNOBEL: I was not perfectly aware of that, that was long before I became Surgeon General. I heard his testimony and I was informed by my predecessor that they had received some of those substances from the police.

MR VALLY: Absolutely, you had heard that.


MR VALLY: Yes, that's all I'm getting from you. And that was mandrax, that wasn't anything else.

DR KNOBEL: In order to extract from it ...[intervention]

MR VALLY: But it was mandrax. You were aware of some projects codenamed Baxil.

DR KNOBEL: That's true.

MR VALLY: Which you didn't know what it was.

DR KNOBEL: I knew that it was a substance from which they were going to produce an incapacitating agent.

MR VALLY: You knew it was a substance which Doctor Mijburgh amongst others was seriously concerned about, may have led to him being prosecuted to the effect that ...[intervention]

DR KNOBEL: When did I testify that Mr Vally?

MR VALLY: You said so in a letter where you assure him that: "From the point of delivery, I'll protect you from prosecution".

DR KNOBEL: But the ground substance was a controlled substance and that he had to have the assurance that he could not be prosecuted if he dealt with that and I gave a very clear indication in the answer, under which circumstances we were prepared to give that kind of immunity.

MR VALLY: So you were at least aware that there was mandrax involved at some stage?

DR KNOBEL: Yes, I did know that methaqualone and mandrax had the same ground substance.

MR VALLY: You were at least aware that this substance, codename Baxil which we now know to be ecstasy, was giving rise to concern, giving, sorry, raising concern of prosecution by the people who are responsible for manufacturing it.


MR VALLY: To the extent where they asked you for indemnity.


MR VALLY: We've put to you - well let me tell you a third thing that you may be aware of, you may be aware of the fact that it was, and we're talking methaqualone, was a restricted substance whereby you had to resort to all sorts of subterfuge to source it from Croatia? If it was a perfectly legal substance which would be freely obtained on the market, why would you go through the that subterfuge.

DR KNOBEL: No, Mr Vally, I don't exactly know what you mean by subterfuge but you are quite correct if you say that I had known that it was a controlled substance that couldn't just be bought off the shelf in Croatia.

MR VALLY: Fine. We've asked before and I repeat that, did you have any scientific basis for believing that these substances could be used as safe forms of crown control?

DR KNOBEL: Yes, I do.

MR VALLY: What is your scientific basis?

DR KNOBEL: If you look at the comments of the Americans and the British on our programme, you will see after they were given a briefing they comment that those substances have been studied as incapacitants and they accepted as being legitimate studies for incapacitants. They are after all the world experts.

MR VALLY: We're talking about production, we're not talking about studies, we're not talking about experiments.

DR KNOBEL: No, no, no, I'm also talking about production Mr Vally.

MR VALLY: So you're saying that the Americans and the British have in retrospect felt you were justified in your experiments and your production or methaqualone and what we now know to be ecstasy.

DR KNOBEL: No, Sir, what we now know to be a ground substance for a possible incapacitating agent. The Americans in their comment on our programme calls it a very sophisticated programme of a sophistication which they've only found in the Russian programme elsewhere.

MR VALLY: We've heard that before. We've also heard scientists before us saying that scientifically and we've had our experts saying that it is pretty pathetic from a scientific point of view, the whole programme.

DR KNOBEL: Listen Mr Vally, quite frankly you, I don't agree with you. There is in this country not an expert on Chemical and Biological Warfare that can give that kind of comment, and I'm not saying that in a derogatory sense to Professor Folb, I have a lot of regard for him as a person, but he is not an expert in Chemical and Biological Warfare.

However, Don Marley and Graham Pearson that was part of the team that came in to look at our programme, they are world experts and they have accepted it and they have put it in writing.

MR VALLY: Your knowledge of Chemical and Biological Warfare we know ...[intervention]

DR KNOBEL: But that was not the point.

MR VALLY: Yes. No, that's fine. The sole basis of reporting on what the developments in our Chemical and Biological Warfare programme for you was Brigadier Basson.

DR KNOBEL: That's correct.

MR VALLY: You're saying that because of this demarche, and remember the first demarche was to tell the then President, President de Klerk, we don't want these things to fall into the hands of the ANC.

DR KNOBEL: Correct.

MR VALLY: The second demarche to President Mandela was: "You don't know what these guys have been doing behind your back, be aware of it and destroy it".

DR KNOBEL: That's correct.

MR VALLY: So their motives are questionable.

DR KNOBEL: That is true.

MR VALLY: I also want to put to you ...[intervention]

DR KNOBEL: Their political motives.

MR VALLY: The demarche was a political act.

DR KNOBEL: Exactly. But I'm talking about two scientists that I had a discussion with where we discussed the assessment of our programme.

MR VALLY: You know you have scientists General Knobel, and you have scientists and scientists working for government as part of a political delegation have got their own interests and are acting on instructions.

DR KNOBEL: Mr Vally, I think you're making an assumption here which may not be founded.

MR VALLY: Fair enough.

DR KNOBEL: Those two scientists are still very much involved in the international arena in terms of defining the lists of substances in terms of the Convention, they are very much involved in looking at inspections, at ratifications, at the schedules of the Convention, they are internationally respected scientists in the field of Chemical and Biological defence or Chemical and Biological Warfare.

CHAIRPERSON: I don't think we should really get into a ideological debate about what informs scientists. I mean, if the same demarche was when the previous government were persuading that government that it would be inopportune, to put it at its lowest, for that sort of technology to fall into the hands of what they considered to be a terrorist organisation. And when exactly that organisation is in power, they consider it expedient to advise them that that programme must be scrapped and must be destroyed. It doesn't really need a genius to determine that those people are not independent. I have never believed in any event that there are people who are totally independent, even scientists are not, they're informed by their own ...[indistinct] elections. But I don't think we should enter that debate. You've made your point and Mr Vally has made his point.

DR KNOBEL: Thank you Mr Chairman.


MR VALLY: My next item that I want to put to you is that when you were advised by Doctor Jan Lourens of the instruments which inject poison, which he says he had been instructed to make by Brigadier Basson who was your project officer for Project Coast which also involved the making of poisons. Your response was that it wasn't your project, it wasn't under your project and therefore it wasn't a matter of your concern.

DR KNOBEL: No, I said more than that. I said I don't know about it and I don't want to know about it, that's what I said Mr Vally.

MR VALLY: Fair enough.

DR KNOBEL: I've already testified to that effect.

MR VALLY: What I'm putting to you is that that was an irresponsible position to take in view of the fact that you had facilities as Project Manger and that your Project Officer was involved in development of toxins and he, your Project Officer, Brigadier Basson, had in fact allegedly instructed Doctor Lourens to make those items.

DR KNOBEL: Mr Vally, what I understood from Mr Lourens or Doctor Lourens was that this had occurred at SRD in the years, '83, '84, '85. We did not have Roodeplaat Research Laboratories at that stage.

MR VALLY: Did you follow it up at all, did you do anything about it?

DR KNOBEL: I testified to that effect, that I confronted General Liebenberg without telling him that his name specifically was mentioned and that his response was that this the kind that the d'Oliviera Commission will be investigating.

MR VALLY: Well you've made a subsequent report to the NIA about various improprieties on the part of Doctor Basson. Did you ever raise this issue with them?

DR KNOBEL: It came up at a later stage certainly, but when I had the briefing from, not NIA, NIS at the time, with Minister Coetzee in February '94 and they indicated the allegations and indications that there were a very large number of such incidents, I was satisfied that they were aware of this and I also dealt with General Meiring and Mr Coetzee and the President in that regard.

MR VALLY: Did you ever raise it yourself with the NIS?

DR KNOBEL: I say again at a later stage I did not raise it at that time.

MR VALLY: By your own admission, the medical, chemical, technical aspects and implications of the programme that cost the country possibly millions and millions of rands were areas outside your expertise, yet you were the highest ranking medical professional in the military, ostensibly overseeing Brigadier Basson at the Co-ordinating Committee meetings.

DR KNOBEL: Are you posing a question Mr Vally?


DR KNOBEL: What is the question?

MR VALLY: Surely you should have realised that you were inadequately qualified to deal with these matters and be representing the military and making suggestions regarding these issues?

DR KNOBEL: Mr Vally, I don't quite understand your question. I am appointed as Surgeon General, I inherit a project which I must help co-ordinate with the Co-ordinating Management Committee. Are you saying to me that I should have gone to the Chief of the Defence Force or the Minister or the Cabinet, because my appointment was a Cabinet appointment, and say to them: "Listen, I am not in a position to carry out this task, please take this away from me", is that what you are suggesting to me? Are you suggesting that the man who runs a garage must also be a mechanic in order to be able to do it?

MR VALLY: I'm suggesting something very simple to you. I'm suggesting that you were not in the position to have advised the Co-ordinating Committee on developments in this area, Chemical and Biological Warfare, and you should have told them directly that: "We need an independent overseer or we need sufficient technical expertise to oversee this programme whilst I am Surgeon General and I have inherited this project, I cannot approve budgets running into millions and millions or rands, I cannot approve whether ...[intervention]

DR KNOBEL: I didn't approve the budgets, the Co-ordinating Management Committee approved the budgets.

MR VALLY: Yes, but regarding the technical side of it, who did they rely on?

DR KNOBEL: On Brigadier Basson and myself certainly.

MR VALLY: Even after improprieties were discovered, the ongoing usage of Brigadier Basson to the extent where all information was obtained from Brigadier Basson involving our technical and biological warfare capacity to onto discs, was irresponsible. By this stage you were aware there were major question marks regarding Brigadier Basson, not only financial improprieties but other activities of Brigadier Basson and that by not taking further action or making sure that you safeguarded yourself from abuse by Brigadier Basson, we are now in a situation where proliferation may have taken place or may potentially take place and whereby the money spent on development on this Chemical and Biological Warfare capacities may have been totally wasted because we are entirely reliant on the words of Brigadier Basson, who potentially is a discredited person. What do you see as your role in this, in retrospect, now that you are here, now that you have further information at your disposal?

DR KNOBEL: I will make remarks to this effect at the end of this hearing Mr Vally.

MR VALLY: Well, I am about to come to the end of my questioning of you. If you want to make any final comment please feel free to do so.

DR KNOBEL: Mr Vally, what I find very unfair is that you are trying to indicate that the final decision and the final management was in the hands of one person, that is not true. It was a Co-ordinating Management Committee under the chairmanship of the Chief of the Defence Force.

In terms of that management he had available to him the Chief of Staff Finance, the Chief of Staff Intelligence, the Chief of Staff Logistics, the Chief of the Army, the Commanding General of Special Forces, later on the Chief of the Airforce and when it was required, also the Chief of Staff Planning and the Chief of Staff and one of these incumbents was also General Steyn.

Now the Surgeon General was there from a point of view that the scientists that was control of the Project Officer and the Project Officer himself, the Project Officer was a member of the medical services and the management was then entrusted to my predecessor, the Surgeon General.

This project had run for eight years and it achieved all the objectives that it had set out to achieve. We spoke very little in this hearing about any of the achievements. I'm constantly reminded that it cost the State a lot of money and what have we got to show for it. You've not paid any attention to the defensive equipment that had been developed, to the detection apparatus, to the decontamination apparatus as well as the decontamination substance.

You've spent a lot of time saying how irresponsible it is to use CR. Some of the scientists have said CR remains in the area where you apply it, that's why the decontamination fluid was developed to ensure that that problem would not arise. You don't say any word about that. You indicate that you believe that these records that we have may contain nothing. I've indicated to you that I've recommended the government a number of times that we should access that information so that we can see how valuable it really is. And I've said to government that that's a national asset of strategic importance that we cannot destroy and we will not, at the behest of the Americans or the British, get rid of, it's too important for us.

You don't mention anything about the knowledge and the learning process that we had in advising the Department of Foreign Affairs or the Department of Trade and Industry with regard to the implications of the various Conventions, with regard to the legislation of this country, with regard to inspections, with regard to declarations.

You don't pay any attention to the important role that South Africa now plays within these two conventions and the respect that they have been dealt with in the international arena where they are giving impetus to new developments in terms of these conventions. I'm not only referring to those two conventions, I'm referring to the Convention on Anti-personnel Mines. You think that all of those things just come out of the air. You don't pay any attention to the fact that one of the officers who served in the medical services is now sitting on the OPCW and playing a very important role there.

You don't pay any attention to the development of a 7th Medical Battalion Group which is a quick reaction group and which has saved lives in this country on a number of occasions because of the fact that they had developed in the way they had with parachuting and free falling and having special medical bags and the skills and the planning skills to do operations and to do the necessary planning for a disaster situation. All of that you think just happens. All of this developed at the same time when we were busy with this project.

In fact the whole 7th Medical Battalion Group has been so discredited that all those members have resigned and are now sitting either overseas or in some of these companies that you've been harping upon this morning. I think it's very unfair to now hamper or pay attention only to one aspect, mainly the irresponsibility.

I have admitted to this hearing on a number of occasions with the wisdom of hindsight I might have acted differently. But you don't give me any leeway in understanding how it works in the hierarchy of the Defence Force where the Surgeon General is part of the team and where he is under the command of the Chief of the Defence Force and where any type of action that you seem to expect me to have done, could have led to somebody simply saying: "We don't need you anymore, get out, we don't need you around". You've got to understand that but you're not understanding that.

I dare to ask you if in this Commission members of the Commission know exactly what is happening at the level of research and development of your own researchers. Are all those records made available, do they ...[indistinct]. I've heard your Chairman testifying in George that he didn't have the time to read the report that Mr Botha put in. I've heard from members of this Committee that they haven't had time to read the Cloud Report which was drawn up exactly with the purpose to inform you fully of all the circumstances that existed and to inform government of all the existing circumstances so that you would have a total understanding of our programme.

I've given a briefing to Mr Mandela which you have and I've given the summary of the two transparencies that I've shown you, and in that is shown all the equipment that we had at that time, masks and filters and detection apparatus and decontamination and clothing etc., etc. You've heard testimony that that is being sought after by the countries that were involved in the gulf war, which gave a lot of credit to South Africa's position. What more can I say to you than what I've been testifying in the last few days? I've admitted that is I'd had the wisdom of hindsight I would have acted differently.

I made a briefing to the TRC on the medical services in totality earlier last year, in May last year, and in that briefing I said that I was not aware of any activity within the medical service as an organisation which in any way I need to be ashamed about in terms of their ethics and their moral standards and the service that they had delivered.

I've drawn up a code of conduct for that service of which I'm extremely proud and I said so here in public. What I also said was that I regretted the fact that the type of hearing that took place led to a discreditation of the entire organisation and to a loss of manpower and loss of expertise which we will never ever be able to replace.

You've made mention of the fact that we may have potentially proliferated. I'm saying much of what has come out of this hearing has contributed to proliferation and will undoubtedly contribute to our international relations being jeopardised and I've said so to Mr Mbeki last week and he agreed with me. I just want to say this ...[intervention]

CHAIRPERSON: Possibly he will have come and testify here if he says that because you know he was very well represented here by lawyers who haven't really projected that image to us. If anything the lawyers who represented Mbeki and his government have given us an indication that that office is very pleased about the way in which we have handled these hearings. We don't regret having taken the decision that we took.

And quite frankly General Knobel, you know the more I hear you speak the more I distressed I personally become because you, inasmuch as you seem to say we do not appreciate the good things that the project was all about, it seems to me you do not appreciate what the Commission is about.

The Commission was not set to discover how good South African was in the past, it has a specific mandate to examine amongst other things but more particularly perpetration of gross violations of human rights in the context of looking at the motives and perspectives, the antecedents, the context, but with a clear mandate to look at violations of human rights.

It may well be that the CBW programme, and at this stage I'm not even making a decision because the panel has got to do that, but it may well be that it did all the good things that it did and I don't think there is anyone here who is going to gainsay that but the fact of the matter is that your scientists came and sat here and testified about the other things that they did which you yourself are admitting ought not to have been done and that is unfortunately what we are here about. We are not here to say because 90% or even 99% of the work that was done by the CBW programme was advancing the interest of science and technology in this country, then we should ignore the 1%, we would fail in our duty.

It is not about whether or not the percentages were 80/20, 70/30, 99 to 1%, it is about the fact that if all this evidence points to us being satisfied that things that have been testified about here are in fact capable of being concluded to have happened, it is about whether or not any decent society should have had those aspects of technology being used in the advancement of those objectives.

If we come to the conclusion at the end that even though 80% of the work that was done by that programme was good, was well intentioned, advanced in the ways in which you have said, it advanced the image of this country, we will not because the 20% of it is making us a prier in the world of today, we should not refrain from making those conclusions.

So it really is not about whether or not, it's the same thing we hear now and every day: apartheid was not so bad, we produced the best schools, Stellenbosch, Pretoria, we produced professors in all fields of human endeavour. Yes, that is true but again we produced the worst of schools, we produced the worst of universities some people were denied by virtue of that same ideology of becoming the best that society could have produced.

So please, let us, especially if that is your contribution to what the question to you, it is certainly not a contribution. You are being asked about a specific aspect, what do you consider your contribution or lack thereof to have been in that part of that CBW programme which to us appears to have been obnoxious in the extreme, to have been intended for purposes for which that programme had not been set.

Don't tell us about the good thing, we all know them, we accept them. Take it for granted that we accept and we laud them for what they were but what is your responsibility when once you discover that there was such a horrifying programme that that man was at the head of. What is your contribution? Do you feel remorseful about not having acted and acted strongly enough in order to counter what he was doing? In fact, did it ever strike you that you may have had to apply for amnesty for your role in being part and parcel of that machinery? If you feel that you didn't have to apply for amnesty, that you have nothing to be apologetic about then say so but don't please let us weigh in terms of which was more advancing the interest of this country and which not because we are going to forecast on that which should not have happened. If the evidence that we have heard here is to be believed, and we will weight that, and we come to a conclusion that it is credible evidence, that which should not have happened will be considered in that light.

DR KNOBEL: Mr Chairman, may I reply to that?

CHAIRPERSON: You can, in fact you should.

DR KNOBEL: I was still giving an exposition of how I felt I should reply to that question and I referred at the beginning to the fact that I'd given a voluntary briefing here at the TRC on the medical service as a whole. I just want to state very clearly that when this inquiry started I co-operated fully because I believe in the process of truth and reconciliation.

CHAIRPERSON: We accept all of that General.

DR KNOBEL: Yes, but let me just please come to this point. When I finished by briefing, May last years, I said the following and I'm reading from the statement that I made:

"If however there is evidence that any professional member of this organisation has acted outside the directives according to the mandate role and functions as discussed or acted in an unethical ...[intervention]

CHAIRPERSON: General, just on that, do you as you sit there now, do you accept - I'm asking you now, do you accept that in fact the evidence that we have heard here does suggest exactly what you are saying?

DR KNOBEL: Yes, I've testified to that.

CHAIRPERSON: So why are you conditioning it now? We are asking you, not at the time that you wrote that memorandum, not at the time that you wrote that affidavit, we are asking you at the end of the testimonies that we have heard.

DR KNOBEL: I'm coming to that Mr Chairman. I would just like to say what I said then and what I add now. Do you want me to continue?


DR KNOBEL: I said that:

"If there's any unethical or unprofessional action according to the guidelines of the various statutory councils with whom they are registered then I would like to apologise on behalf of the organisation to any member of the South African community that may have been adversely affected by such actions"

I also at that time as Surgeon General said I would take with my command council, whatever steps are deemed necessary to investigate and bring to justice such actions.

I now want to say with the wisdom that I've obtained during this hearing that I am like you, horrified with the possibility that those sort of actions could have taken place. I am very disturbed by it and I absolutely agree that one should do everything in your power to prevent this sort of thing from happening again. And I want to assure you that my support to the following investigations of the Attorney General as well as of OSEO will continue, to bring whatever injustices have been carried out or criminal deeds have been carried out to justice.

CHAIRPERSON: Thank you Doctor Knobel.

Mr Vally, do you still need to call ...[intervention]

MR VALLY: No, thank you Mr Chair, I'm through.

Thank you General Knobel.

CHAIRPERSON: Are there any questions from the panel to General Knobel? Doctor Randera? Advocate Potgieter?

DR RANDERA: ...[inaudible] you've taken a great already but I think for the record I just want the General's comments on two specific areas. One is the question that arose yesterday from Doctor Mijburgh in terms of the production of these million capsules with whatever was in it. Now as head of the South African Medical Services, was that a method that was used by the medical services to buy drugs from private companies?

DR KNOBEL: No, it was not.

DR RANDERA: Have you ever known of that, has that ever happened in the time that you were the head, the Surgeon General of SAMS?

DR KNOBEL: No, Sir, your question was very relevant. There was no, to my knowledge there was never any authority given for the production of capsules of whatever nature. The medical service had a depot and a number of sub depots and has an account which at that time was known as the: Current Account for Pharmaceutical Products. We dealt with about 40 pharmaceutical companies, recognised pharmaceutical companies in the country who supplied us with all the necessary pharmaceutical needs that we had.

The Surgeon General had a certain responsibility in terms having on the shelves supplies that would last this country for a minimum period of three months or in some cases six months, of certain pharmaceutical products, particularly those that deal with malaria or those diseases that tend to come in epidemic natures and obviously with the possibility of being isolated in terms of its pharmaceutical needs, the Surgeon General had that kind of responsibility. So the answer to your questions is, yes, we would never have placed such an order, there was need for such an order.

DR RANDERA: Again for the record, we've moved on a great deal from the time that it was brought to our notice, and that's the issue of the experimentation that was done with regard to fertility control in South Africa, at Roodeplaat.


DR RANDERA: Now at the time, and let me say that the report that we had here was 1989, so it was after you became Surgeon General that those experiments were being done. Were you aware of these experiments, was it ever brought to your notice at the committee level? And again, did you ever question what that had to do with Chemical and Biological Warfare?

DR KNOBEL: Yes. Let me say this first of all to give you a background Doctor Randera. The Surgeon General represents the Defence Force or at that time, on an inter departmental committee on population development. General Niewoudt was on that Committee and when I became

Surgeon General I was also appointed in that capacity as a representative of the Department of Defence, in fact in representing the Minister on that Committee.

On that Committee the whole question of the population explosion was constantly being discussed and the water supplies of the country and the infrastructure that had to carry this population. Things like the illegal immigrants coming into the country and the very large population that had to be carried by the resources of this country.

As was testified here by Doctor van Rensburg if I remember rightly and I read it, he indicated that the World Health Organisation had indicated that there would be a use for a vaccine that could have an effect on population development. So to come to your question - I see you're getting agitated, I was informed when I became Surgeon General, that my predecessor had approved that a commercial project could be carried out at Roodeplaat and I have indicated to you that commercial ventures were allowed, that they could study fertility and they could study the possibility of developing a male contraceptive pill as well as a vaccine. And that that was done, the information I had does not concur with what was testified here, the information was that this could be done for the People's Republic of China in exchange for technology that would be made available ...[indistinct]. That's the information I had and I accepted that.

DR RANDERA: General, my last question is really for you to make a comment. Since this started I've been thinking about the role of scientists in the society that we've come from and where we are at the present time and part of my consideration has been to think, is it just a few mavericks that were involved in the sort of experimentation that we've been exposed to, or were they just the extreme of a spectrum. And you are a scientist yourself, not in the sense of a Brigadier Basson or Immelman, you were an anatomist, Professor of Anatomy before you joined the Medical Services, joined the Army. I suppose I'd like you to comment: 1. On this issue of scientists in the past and how they became involved, because we're trying to understand institutes as well. More specifically I want to understand your own, because I think the Chairperson said earlier on: "What responsibility are you taking yourself", your own thinking and your own psyche at the time in becoming not only involved in the Defence Force, and I take, I mean I heard you very clearly when you spoke at the Medical Hearings on the pride that you take on what was achieved by SAMS, but nonetheless we were involved in a conflict in this country, you were part of that conflict, pre 1994 and so I'm trying to understand your own role and your own thinking. You made a conscious decision to move from a position of academia into the military services and then became part of the structures of those military services, including the Chemical and Biological Warfare programme that we've heard about.

DR KNOBEL: Doctor Randera, in my briefing to the TRC on the programme I went out of my way to try and clarify my initial position and why I became involved with the medical service in general. I can sum it up by saying that I initially did not want to join the permanent force because I was quite happy in the academic environment and I was making a contribution in the citizen force.

However, my predecessor had been battling to separate the medical service from the army and the airforce and the navy and creating a separate arm of service which is unique in the world. Today there are quite a number of countries that have followed suite but at that time it was totally unique. He inspired me with a missionary zeal to help him to establish that and the emphasis at the time was to create for ourselves our own image, our own ethic, our own code of conduct, our own uniform, our own budget, our own command and control system.

All of that had been achieved, but one of the issues that was very strongly conveyed to me, that as an academic I had to bring in the academic approach to elevate what was basic military training, with military emphasis, with military requirements and with typical military disciplinary code as being the guiding line. I had to bring into it the professional code, the code of conduct of the various professional statutory bodies and to write a code of conduct for this which was a unique situation, a professional person in uniform.

That process took at least 15 years. And that is really the process that I tried to convey to the TRC at my last briefing, which I was very proud of. Every profession, there are 27 statutory professions in the medical service, every profession has had designed for themselves a caduceus which they wear to comply with the requirements of the International Red Cross recommendations in terms of the Geneva Conventions.

Every bit of conduct within the military environment in uniform, but in the uniform of the medical service, is designed to comply with the Geneva Conventions with relation to the conduct of medical personnel.

Having listed to this hearing, having heard what we've heard with regards to what I intend to submit to you are mavericks in the organisation, has horrified me and I'm very distressed by it and I'm absolutely in total agreement that whatever comes out of this hearing, one of the things that should come out of it is how do you prevent this sort of thing happening again, without losing what has been established on the positive side. I would feel very, very, distressed if we lose what is on the positive side because of what is emerging on a negative scale. That I would like to make a contribution to prevent from happening.

I will say this, and I've heard testimony by a number of the other witnesses, as far as the ethics and the morals are concerned I can see no difficulty with the Surgeon General been given the responsibility of being involved or even co-ordinating a project which will ensure that the medical personnel act within international conventions and accepted international conduct.

We've had discussions here about whether CR, is it right to develop something like CR. You've heard the answers, people have said it's much better to use something that will either incapacitate or subdue a crowd rather than shooting them. I feel the same way. I feel the same way about the carrying of weapons. It is true that the medical service carried weapons but strictly according to the conditions as set out in the Geneva Convention, to protect themselves and to protect their patients.

The Geneva Convention states very clearly: if there is an international conflict and a declaration of war, those conventions apply fully but they also recognise that there are other conflict situations which is not an open declaration of war and where circumstances prevail where the position of the medical personnel is different.

I've considered all of that and I have constantly been measuring the medical service against that, particularly in our situation and what we used to call: "the bush war" and within the internal environment.

I'm distressed with you about the possibilities that have come out here about the indications, I've admitted to that. I think the biggest dilemma and I've said that before this morning, the biggest dilemma is that we have found ourselves in a position where we only had one person with the very wide powers of self decision making, freedom of movement and the only person who had all the skills and knowledge of this very, very complex programme. We've lost the other few that we had and we've nobody to replace him. That is a fact, we have no-one to replace him.

CHAIRPERSON: Advocate Potgieter?

ADV POTGIETER: Thank you Chairperson.

Doctor Knobel, just on the same vein of the parameters of this project that Doctor Randera has touched upon and the concern that we've expressed about abuse and perhaps touching upon your concern that the evil will live after the project, as Shakespeare reminds us. You see the stuff that seemed to have been produced in very large quantities, staggering quantities to my mind in some respects, are the drugs, the common drugs. Let's take methaqualone, 1000 kilograms, just to think of one. I'm quite sure there's some other examples in this documentation. Ecstasy, so-called MDMA or whatever the technical name was that was ...[indistinct] about here for the substance. Have you ever had any doubt in your mind at any stage, even during these hearings, that this aspect, the drug aspect to this thing had nothing to do with this project and that was potentially ways in which this could have been absurd for whatever purpose?

DR KNOBEL: No, certainly after hearing I'm sharing your concern about that. At the time I was satisfied with the destruction of those substances, that we had in fact destroyed them. And we discussed it at length yesterday, I can't remember if you were here then.

ADV POTGIETER: Probably not.

DR KNOBEL: But we discussed at length the way in which the certification took place and so on. And certainly I suggested yesterday that maybe we should get more confirmation from the officer of Counter Intelligence who was involved and so on, and even other members who were there, airforce people. However you are right, I am concerned about that today.

I must however say that I also share the view of Lieutenant General Neethling when he said that the tablets that we were talking about, I think it was 200 000 tablets, that really is not all that many tablets. What I am concerned about is if a thousand kilograms of substance were then converted into tablets, that would be a major problem. I'm not sure if we have proved that Advocate Potgieter. We've indicated that there is such a possibility and I'm gravely concerned about it, that I would admit.

ADV POTGIETER: And that one is left with some serious doubt whether there is any credence that one can attach to the point that was purportedly made here, that those things could have been used for crowd control purposes.

DR KNOBEL: No, I'm afraid there we have to disagree Advocate Potgieter, because the fact of the matter is that I think General Viljoen has said something like that recently as well in the press, the intention was to have dual use capabilities. We all knew that at some or other point there was going to be a new Convention and we would have to rethink the position of retaliation. We all knew that, we said that, we advised government in that regard.

You know today we are sitting with a very large quantity of CR both weaponised and non-weaponised and it is being maintained at the instruction ...[intervention]

ADV POTGIETER: I can agree with that but I'm focusing entirely on methaqualone for example, cannabis as a, I'm just talking about that aspect. I can understand that CR is the sort of a thing that we know but cannabis and methaqualone, I mean it's not in the common mind as a crowd control measure. We know it as a substance of terrible abuse out there.

DR KNOBEL: No, I agree with you it's not in the public mind and maybe not even in my mind but I was concerned about this when I spoke, I said this morning that I had spoken to Don Marley and Graham Pearson who are world experts and I agree with what the Chairman says. I was the one who said to the President: "You cannot trust the finding of these two demarches", because it was really one demarche but two different governments that they were dealing with. I agree fully with what the Chairman says there and I advised government accordingly.

At the level that I discussed it with the two scientists, and I had them separately in my room, the two of them together separate from the rest of the team, the intelligence people were not there and the Ambassador and the High Commissioner were not there, and then we had a different kind of discussion and I asked them: "Are you satisfied with the programme that we had an does it make sense"? And they both indicated that they were totally satisfied and that it was a very sophisticated programme. I said so yesterday to Professor Folb, because it was a point that also concerns me, that's why I'm discussing it with him. That's why I'm saying, the use of those substances as potential incapacitating agents is recognised and it's accepted, maybe not by the public or you and I, I agree, but certainly internationally.

We have the evidence of General Neethling that they in America even look at LSD as a possibly incapacitating agent.

ADV POTGIETER: Yes, well thank you, there's a lot of food for thought here, thank you.

DR KNOBEL: Thank you Sir.

CHAIRPERSON: We've reached a stage where we should take the lunch adjournment and it is clear that for the right of reasons we are not able to stop here and now because I believe that is a right that is in inherent to Doctor Knobel's legal representatives to put certain things in perspective by way of re-examination. We should then take the lunch adjournment.

MR DU PLESSIS: Mr Chairperson, sorry to interrupt. There will be no re-examination.

CHAIRPERSON: No re-examination.

MR DU PLESSIS: I don't know if that helps the Committee.

CHAIRPERSON: Well I don't know, we then have Mr Kennedy's affidavit which we all have had sight of, I don't know whether in your view it raises issues in relation to which you would like to respond. You can take a quick consultation on that question.

MR VALLY: We will put it on record, so the affidavit will be part of the record of this hearing.

DR KNOBEL: Mr Chairman, clearly I would have liked to have had that read into the record.

CHAIRPERSON: It will be read into the record.

DR KNOBEL: Yes, but I mean in public. But under the circumstances I will accept your ruling in this regard and we don't have to read it in public.

MR VALLY: Maybe as a compromise, because General Knobel doesn't seem to be happy, which particular paragraphs are of relevance to him that he wants to be read in public because there hasn't been a ruling by the Chairperson as such but it is part of our record. Also we will release it to the press.

DR KNOBEL: In that case I think we can leave it Mr Chairman, and I'm happy, thank you.

CHAIRPERSON: Now can I understand where are we?

MR VALLY: We are through.

CHAIRPERSON: Well that's it. It appears to be the conclusion of these proceedings. Much of what I would have said at the conclusion of everything has already been said in my intervention when Doctor Knobel was saying his piece when in fact he was entitled to say what he wanted to say.

Ladies and gentlemen, we have come to the end of these proceedings and I think we need to thank everybody who has been party to these proceedings. It has not been the easiest of proceedings to deal with because of all the sensitivities that attach to dealing as candidly and as openly with a project of this nature but still infusing into that process a responsibility that should make sure that we comply with the duty to inform the public without in a sense throwing out the child with the bath water.

I'm concerned that it is the view of General Doctor Knobel that those in authority might feel that we have not handled these proceedings in a manner that would obviate proliferation but I would hope that after all is said and done even government will feel that we have tried as much as possible to handle what is really a sensitive programme with care and with sensitivity.

There are particularly people who I would like to mention even if it is in their absence. Professor Peter Folb made himself available as a consultant to the TRC at no cost, voluntarily, and that is something that I needs to go into the record as an indication of the preparedness by a number of people to be as helpful to the process as possible. His expertise has been very helpful to our investigators and it is a matter of gratification to also understand and know that his expertise is acknowledged by his piers in the form of amongst others, General Knobel who himself is an expert in his own field. We have to thank Professor Folb in his absence and would hope that these remarks will find their way to him as an indication of our appreciation for his services.

We must also thank particularly the legal representatives of everyone. We have been engaged in mini battles in the process of these proceedings with some or most of them but it has all been in the spirit of trying to do that which lawyers know best, representing the interest of their clients in the best tradition of their profession. We would hope that altercations that have taken place in the process of trying to get to the end of these proceedings and revealing the truth will be taken in the spirit in which they were all engaged in.

We have had to deal with the proceedings on the basis that pending the outcome of the High Court application we will not take in the period allotted to us, in other words today and yesterday, the evidence of Doctor Wouter Basson. So as far as taking that evidence is concerned it is suspended only to the extent that we will await the outcome of the Court process.

Speaking for the panel, we are of the view that it is not only in our interest and the interest of society and certainly the interest of the Commission but in the interest of Doctor Wouter Basson himself that his perspective and his testimony should be received. I know this is a forlorn cry but to the extent that I can persuade from a moral point of view, his lawyers and knowing as I do that colleagues do not give instructions to their clients, they take instructions from their clients but if it is possible and it is within them to persuade him to come and testify, we would ask them to persuade him in the way in which they persuaded Doctor Mijburgh, that it may be in his interest to come and testify and that at the end of the day there is nothing to fear in giving a perspective, especially if that perspective is the truth.

So we will not take the evidence of Doctor Wouter Basson at this stage but I want to place it on the record that we have not abandoned efforts to take that evidence, and the only intervening circumstance between us and that event is the fact that there is an application which seeks to stop us from taking that evidence. Of course he can override that by voluntarily deciding at last that he wants to come before us, not only to state his own perspective but also in a large measure to clear his name in those respects where he may unfairly have been prejudiced by either the manner of testimony or some of the things that were said.

Subject therefore to the recall of Doctor Wouter Basson, these proceedings are adjourned sine die.