Risks of JSF project impossible to calculate

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Risks of JSF project impossible to calculate

Hans Andringa, October 11, 2006, www.radionetherlands.nl

The Dutch audit office is worried about the financial risks for the Netherlands of the Joint Strike Fighter project. The development costs of the new fighter plane have already risen alarmingly and may go higher still. The cabinet and parliament have to take a decision soon whether to continue as a partner in the development phase of the aircraft.
The audit office says it is impossible to predict what the final selling price of the JSF will be. Spiralling costs In 1999 the Defence Ministry expected to pay 4.5 billion euros for the 114 JSFs it intended to order.
Today the ministry plans to buy 85 fighters for 14.6 billion euros. Every country that wants to take part in the JSF project has to buy a share. So far this has cost the Netherlands over 400 million euros. Continuing as a partner will mean paying a total of around 600 million euros.

Blank cheque

Parliament is split down the middle. The audit office report is welcome ammunition opponents of the project. The opposition Labour Party says it's too risky to continue with the JSF project. According to the party's defence spokesman Luuk Blom, "signing up now is the equivalent of signing a blank cheque." The coalition parties, the Christian Democrats and the VVD, plus the far-right LPF want to press on with the project.
They still see the plane as the best choice for the best price. Christian Democrat MP Roland Kortenhorst argues that "the risks are no greater than when the second Wim Kok cabinet committed to joining the JSF project." That was in 2002. Lost contracts The VVD's Zolt Szabo says "if the Netherlands backs out now, the Dutch business community will miss out on a lot of contracts." So far several hundred million euros of business has come their way. Once production of the aircraft has started, that figure could rise to around seven billion euros. Lobbyists Since the decision whether to carry on with the JSF project has to be taken this year, it's no surprise that a JSF promotional team is currently lobbying in the Netherlands. Tom Burbage, Executive Vice-President of aircraft builders Lockheed-Martin, says, "Dutch participation in the JSF is of very high value to both us, the JSF project team, and to Dutch industry." Ed O'Donnell of engine makers Pratt & Whitney has had good experiences with Dutch firms: "Some of it is unique - or they are certainly ahead of everybody else, so they've got a competitive advantage today that can make things faster, cheaper, better." Defence Minister Henk Kamp emphasizes that the decision whether to buy the Joint Strike Fighter will not be taken by this cabinet. That will be up to the next cabinet, after the November elections.

Translation by RNW Internet
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