According to the latest estimates, Australia will have spent 3.7 billion euros on the cancelled purchase of Naval Group submarines, which were replaced by an Anglo-Saxon solution, as the country enters another election period. A policy change that comes at a high expense to the taxpayers.
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| [Australia France Submarine Deal] |
Australians are still talking about the scrapped submarine deal with France. An opposition senator forced the government, just before a new round of voting began, to acknowledge that cancelling the acquisition of 12 French Barracuda-class submarines, bought in 2016, would cost a significant sum of money.
Australia will have spent up to 5.5 billion Australian dollars, or 3.7 billion euros, on this deal that was never completed. How much money will the taxpayers have to spend on submarines that don’t exist? During a hearing in Canberra, Senator Penny Wong was questioned. Defense Deputy Secretary Tony Dalton said, “The ultimate payment will be somewhere in the area of 5.5 billion Australian dollars.”
In addition, Mr. Dalton said that the ultimate cost of constructing the yard was still being negotiated with Naval Group. Naval Group received 840 million euros from Australia for designing and building future submarines—not including the millions paid to Lockheed Martin, which was in charge of the combat system; the millions spent on the contract’s administration; claims from dozens of Australian firms on board; etc.
We at Naval Group would like to stress out that the remainder of the 3.7 billion will be relatively little when compared to the expenses of terminating the contract, such as unpaid bills, dismissal fees, repatriation costs, and computer costs.
Scott Morrison’s decision to cancel the contract with Naval Group in favour of the US nuclear-powered submarines guaranteed by Washington and London as part of a broader accord on security was made possible by a window of opportunity in the agreement. As a result, Naval Group will not be able to seek damages for breach of contract.
It serves as a deterrent. During the period between 2016 and 2021, Australia spent a significant amount of money acquiring and building the shipyard in Adelaide where the submarines were to be constructed. In light of the fact that Washington and London must submit a proposal next year, a location that is likely to be unsuitable.
Finance Minister Simon Birmingham defended the decision to reject the French pact as “essential for decades to come” in the face of criticism from the opposition yesterday. He justified his actions by saying, “It must be accepted that we understood that the ramifications would be substantial.” As a reminder, Scott Morrison has previously said that he desired nuclear-powered submarines in light of China’s increasingly menacing behaviour.
More than $80 billion and decades are required to implement AUKUS, according to a report issued in December by the Australian Institute of Strategic Policy. At this moment the Australians have no notion what submarines they may one day own. Rather of purchasing nuclear submarines of the British Astute or Virginia class, Naval News reported research on a nuclear adaption of their present Collin’s submarines (American model).