"No, we are not going to fly the required number of hours," he conceded during a media briefing ahead of Defence Minister Lindiwe Sisulu's budget vote in the National Assembly.
"But the hours that we will fly will ensure that the people and the aircraft are safe and that we do the correct training."
Gagiano said the air force was getting around the problem by having the cockpits of its fleet of 24 Hawk jet trainers "Gripenised" to make for a smoother transition for pilots from one to the other.
"We have a few mitigating strategies.
"First of all as a design principle, we have decided to Gripenise the cockpit of the Hawk so that means that the transition from Hawk to Gripen is almost seemless and very quick.
"People adapt to the new environment.
"It is basically just higher performance but they are totally used to the systems.
"We are also in the process of upgrading the PC-7's cockpits which is enhancing this process and we intend to pull down work from Gripen to Hawk to PC-7 to do the same kind of training but at a much lower cost."
He said the air force was also using Gripen simulators extensively and this was working very well.
Gagiano said so far 15 Gripen have been delivered from Sweden and the rest would be stored there free of cost until there was a full consignment ready to be flown out to South Africa.
He said the shortage of funding for the Gripen was part of the shortage of funds felt by the defence force, which is a getting a scant additional R1.3bn this year.
"Gripen is part of this under-funding, perhaps because of the cause of this capability it is perhaps more visible there."
The air force's budget comes to around R6bn of the total defence budget of just over R34bn, which Sisulu described as totally inadequate.