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AN expert defence team has until July next year to reverse the fortunes of the beleaguered air warfare destroyers, as the government reveals the $8.5 billion construction project is running three years behind schedule.
As revealed in The Australian today, the government has released its long-awaited rescue plan for the air warfare destroyer project, following eight months of negotiation with defence contractors.
But exposing the challenge to salvage the nation’s largest ever defence project, Finance Minister Mathias Cormann revealed that the first and second ships are now running 30 months behind schedule, and the final ship’s delivery date is now three years delayed until 2020. This is a further 15 month delay since the project was last “rebaselined†in 2012.
Senator Cormann said the group of up to 40 defence experts from Raytheon, Navantia and BAE to be deployed to the ASC shipyard in Adelaide would be contracted to help manage the project until July next year.
“The government has been working and is committed to ensuring that this important defence project is put back on track,†Senator Cormann said.
“We are committed to stop the growing schedule and cost overruns which we inherited from our predecessors.â€
He said that the most recent advice was that the project was at least $600m over budget, but the new team would. investigate the extent of the blowout..
“The work that is to be done over the interim period between now and the end of July 2015 will focus on really putting a final number on the actual cost overruns,†he said.
A shipbuilding source said all participants had been convinced by the government to cooperate, in recognition that future shipbuilding contracts — including Australia’s role in the future submarine project — would be jeopardised if the AWD project could not be salvaged.
“The government has clearly said the future of naval shipbuilding in Australia starts and finishes with turning the AWD around,†the source said.
“There is no prospect of Âadditional work for anyone in the industry unless we fix up the AWD program.â€
The move comes after Defence Minister David Johnston last week said ASC could not be trusted to build a canoe, and following attacks on the project as a “disgraceful mess†and a “skunkâ€.
Senator Johnston said today that fixing the air warfare destroyer project was critical for proving the country had a viable shipbuilding future.