Friday, May 13, 2011

Fighter jet plan 'faces death spiral'

Dan Oakes

May 14, 2011

AUSTRALIA may need fallback options to maintain air combat capability if the troubled Joint Strike Fighter project is hit by further delays or cost overruns, a defence analyst says.

In a paper on the JSF, also known as the Lockheed Martin F-35, Andrew Davies of the Australian Strategic Policy Institute also says the federal government should not rely on Defence for objective advice on whether it should look at other options.

''Their answer will remain 'F-35', pretty much independent of the question,'' Dr Davies said.

Australia has indicated it will buy 100 of the fighter-bombers to replace its fleet of less capable F/A-18 Hornets and the now-retired F-111 fighter-bomber.

The first batch of 14 aircraft, worth $3.2 billion, is due to be delivered to Australia in 2014, but Dr Davies said that price was likely to increase.

''It's not clear what will happen if the approved allocation is insufficient. Going back to government in the next couple of years for extra money isn't likely to be a winning strategy.''

However, the head of Australia's JSF program, Air Vice-Marshal Kym Osley, told the Herald yesterday that the cost of the first delivery of aircraft was still within the budget allocated.

''Based on information we have received from the US, our allocation of funding at this point in time is adequate to cover the first 14 aeroplanes still with contingency left over,'' he said in a rare public comment.

''You expect, as you get close to a contract signature … your contingency will be reduced.''

A recent report by the US Government Accountability Office indicates the program, already behind schedule and over budget, is likely to experience additional production and cost pressures.

The problems with the project in the US could lead to what Dr Davies called a ''death spiral'', in which the production run is cut, leading to higher prices, which leads to another cut in numbers and so on.

Dr Davies said that any further delays or cost blowouts would also bring Australia perilously close to needing a back-up plan. ''Margins are getting uncomfortably tight in some respects, and there may be - and certainly should be - planning going on within the Defence Department to have a fall-back plan in place should the situation further worsen.

''Overall, schedule is more of a concern than cost. Any further slippage in the F-35 program risks eroding Australia's margin for error dangerously.''

In 2006 the defence minister Brendan Nelson pushed through a plan to buy 24 F/A-18F Super Hornet fighters to bridge the gap between the retirement of the F-111 and the arrival of the JSFs.

Dr Davies said there were two options the government should consider. The first - if the gap in capability was only a year or two - would involve upgrading the existing standard Hornets. The second would be to buy or lease more Super Hornets.

Air Vice-Marshal Osley said an upgrade of the Hornets was conceivable if the delivery of the JSF was delayed. ''That's certainly a remote fallback option that Government would want to consider, if the JSF was slightly delayed.''

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