Paper Claims Government Deliberately Cites Lowest Figure
An investigation by an Australian newspaper into what it calls
"the true cost" of the country's agreement to purchase up to 100
F-35 Joint Strike Fighters has caused some controversy, and
prompted a terse response from Australia's Department of
Defense.
The Age reports a recent assessment by officials with the RAAF
and Defense Department concluded the total cost of an F-35 that
meets the minimum requirements to enter active service will be at
least $131 million per plane. That doesn't jibe with figures
Australia's government and the RAAF have told the public, the paper
says, which have run between $67 million and $80 million (all
costs are in Australian dollars -- Ed.)
The difference lies in between "recurring fly away cost" -- the
amount of money needed to simply send the plane out the factory
door, the Age says -- and "average procurement cost," which factors
in the total needed to build the plane, equip it, and fly it. The
latter also includes the cost of training, support, and spare
parts.
Andrew Davies, program director of the Australian Strategic
Policy Institute, says the government isn't technically wrong in
quoting fly away cost, but it is somewhat misleading regarding how
much Australia will pay to send each plane into the air.
"The lowest figure is the recurring fly away cost, which is the
cost incurred every time a new airframe is rolled out the hangar
door," Davies said.
When asked to explain the difference in figures, a spokesman for
the Defense Department declined to comment on procurement costs,
due to "different non-procurement profiles between the US and
Australia."
On Monday the Department of Defense issued a release, responding
to The Age report.
"Some media reporting today fails to show a proper understanding
of costs associated with the JSF," the DoD said. "... Defense has
always been careful to point out that the total project cost for
the New Air Combat Capability project will be higher than the sum
of flyaway costs for individual JSF aircraft.
"The estimated average flyaway cost
for Australia's JSF aircraft is currently estimated to be about
$A80 million. Total project costs, however, will also include the
acquisition of facilities, spares, initial training, support
systems and weapons," the release noted. "Typically the cost of
these broader project elements adds about 50 percent over the cost
of the acquisition of aircraft, providing an approximate per
aircraft total cost of around $A120 million.
"For a fleet of 100 aircraft this would mean a total project
cost of around $A12 billion which is well within the project cost
published in the 2007 Defence Capability Plan of $A11.5 to $A15.5
billion."
Australia has allocated up to $16 billion to purchase up to 100
F-35s, to replace the country's fleet of early-model F/A-18 Hornets
and F-111s.
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