Home' Asia Pacific Defence Reporter : APDR June 2014 Contents Asia Pacific Defence Reporter JUNE 2014 45
Defence BuDget 2014-15
Sailors perform a helicopter in-flight refueling exercise
with an MH-60R Sea Hawk helicopter assigned to
Grandmasters of Helicopter Maritime Squadron (HSM)
46. (U.S. Navy photo by Mass Communication Specialist
3rd Class Derek Paumen/ Released)
available acquisition funds.
(AIR 5349 PHASE 3)
The $3,037m project, which will acquire 12 Growlers
aircraft, equipment, spares and training, is seen as a
key force multiplier, possibly to 2040. It will be equally
effective with both F/A-18F Super Hornet and F-35
Lightning II aircraft as an airborne electronic attack
capability. This is a mature aircraft, with Boeing
delivering their 100th EA-18G Growler to the US
Navy in May this year.
Only $335m has been spent so far, but because
all of the 12 aircraft are in factory production during
2014-15 with the first two to be completed third
quarter 2015, there has been an increased budget
appropriation to $797m, up $499m, for the coming
F-35 LIGHTNING II
(AIR 6000 PHASE 2A/B)
The acquisition project for the F-35 Lightning II has
been very challenging for its champions within the
RAAF and DMO. Cost over-runs, technical problems,
performance issues, and late delivery have required
strong resolve to overcome them. Fortunately it
now appears the F-35 will be an excellent multi-role
This $2,940m project for 14 aircraft has been a
long time coming to fruition since approval to order
them was announced in November 2009. With
$446m expected to be spent by 30 June 2014,
a further $238m has been budgeted for 2014-15
and this will include final payments for the first two
aircraft being handed over at Fort Worth in July 2014.
The remaining 12 will be delivered later this decade,
probably 8 in 2018 and 4 in 2019, to create the first
F-35 squadron in the RAAF by 2020.
The first two aircraft will cost around $125m each,
but the twelve later in the decade should drop down
to around $90m each as volume production ramps
up. By this time the Australian defence industry
should be feeling the benefit of F-35 component
orders for aircraft contracted by many countries.
When the Prime Minister announced in April
2014 approval to acquire an additional 58 aircraft
he predicted a total capital cost of $12.4b for this
acquisition, which includes the cost of associated
facilities, weapons and training. Around $1.6b in
new facilities and infrastructure will be constructed,
including at RAAF Base Williamtown in New South
Wales and RAAF Base Tindal in the Northern Territory.
Defence has stated “The funding for the recently
approved 58 aircraft and associated elements will be
transferred to the DMO post the 2014-15 budget.”
(AIR 7000 PHASE 2)
In February 2014 the Government announced
approval to acquire eight P-8A Increment 2 Poseidon
Aircraft and support elements through a Cooperative
Program with the US Navy. This phase will also deliver
facilities at Edinburgh, South Australia, Townsville,
Queensland, Pearce, Western Australia and Darwin.
Later this decade these aircraft will start replacing
AP-3C Orion maritime patrol and response planes.
The Government also approved an option for a further
four aircraft subject to outcomes of the Defence
White Paper 2015 review.
The first aircraft will be delivered in 2017, with all
eight aircraft fully operational by 2021.
Only $122m has been spent so far in this $3,505m
project, but a $300m increase in budgeted 2014-15
expense to $324m is the result of production being
brought forward to earlier than originally planned.
This kind of sudden change will always be a
risk with US-based programs as their contractors
move production allocations around, particularly at
the moment with sequestration biting hard into US
defence acquisition spending and causing their
services to cut back on platform numbers.
(AIR 8000 PHASE 2)
With the first four aircraft, together with spares and
support equipment being delivered during 2014-15,
DMO has had to open the purse strings for a further
$156m bringing the total financial year appropriation
to $314m. Already $446m of this $1,289m project
has been spent.
This is yet another example of the twists and
turns in FMS acquisitions. One thing that really
hurts the Australian defence industry is the lack of
local supply to the production process. The only
opportunities come in preparing for the planes arrival
then supporting them, their aircrews and maintenance
personnel when introduced into service.
(AIR 9000 PHASE 8)
APDR had the opportunity to visit the MH-60R
production line in September and again in December
2013 when the first two aircraft were handed over to
the RAN. Ultimately 24 aircraft will be procured for
the RAN’s combat force ships and pilot conversion
Coming on the back of a mature US Navy program,
this is a relatively risk free $3,237m project. $902m
has been spent so far and a further $505m budgeted
for 2014-15 for another five aircraft and bringing
home to HMAS ALBATROSS in Australia helicopters,
personnel, equipment and spares.
(AIR 9000 PHASE 2)
Although no longer a Project of Concern, this
$3,785m project for 47 multi-role helicopters for
the Army and Navy has had more than its share of
problems - hopefully now on the way to resolution.
$902m has been spent so far, with a further
$286m budgeted to 2014-15. Australian Aerospace
had delivered 15 aircraft to Defence by the end of
2013, so the rate of production is fairly slow. Only five
MRH-90 helicopters are expected to be accepted
during the coming financial year.
5/06/14 3:51 PM
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