How do you solve a problem like an expensive aircraft carrier?

11 May 2012

Yesterday the Defence Secretary Philip Hammond announced a change in policy on fighter aircraft for the Royal Navy's aircraft carriers. 

Mr Hammond told the Commons that the Government would be acquiring the STOVL (Short Take Off and Vertical Landing) varient of the F35 Joint Strike Fighter (JSF) rather than the conventional aircraft which the Government said it would purchase in the 2010 Strategic Defence and Security Review (SDSR).

Mr Hammond commented on the price of the new scheme on The World at One on BBC Radio 4:

"Something in the order of £100 million overall is likely to be the total cost of the design work, the project evaluation work that's been done and shutting those projects down and reverting to fitting the ski ramps for STVOL operations on the two carriers. That's the sort of order that we're talking about."

But this appeared to be flatly contradicted by the Shadow Defence Minister Jim Murphy, who said to the House of Commons:

"In tough times, £250 million have been squandered [on the aircraft carriers 'u-turn') while the forces are having their allowances cut."

Why did the Government change its policy?

The last Labour Government ordered the construction of two new aircraft carriers for the Royal Navy. These would carry the STOVL (Short Take Off and Vertical Landing) variant of the F35 Joint Strike Fighter (JSF) that would take off from the aircraft carriers by a 'ski ramp'.

In 2010 the current Government held a review of defence spending, the Strategic Defence and Security Review (SDSR). This recommended that the Government procure instead the conventional take off variant of the F35 JSF.

This version is regarded as a superior aircraft: it has a longer range, can carry more weapons and has a lower unit cost. At the time the STOVL variant was also experiencing serious technical problems. However, the conventional take off variant would require that the aircraft carriers be fitted with catapults and arrestor gear to assist with take-off and landing (known as 'cat and traps'). The carriers would be fitted with a new catapult system that was being developed by the United States.

The installation of this system led to many problems though. The estimated cost of fitting this equipment to just one of the aircraft carriers, the Prince of Wales, doubled from £950 million to £2 billion while the cost of retrofitting this system to the Queen Elizabeth could have been higher still.

Secondly, this redesign had meant that the first operational aircraft carrier would not become operational until 2023; the SDSR estimated it would be ready by 2020. At the same time many of the technical problems with the STOVL variant of the F35 had been resolved.

These were the main reasons outlined by Mr Hammond for this week's change in policy.

So why the different figures?

In the House of Commons yesterday Mr Hammond said that there were no definitive figures on how much the change in policy would cost. He did say:

"We think the cost of the design work that has been carried out and the appraisal work will be between £40 million and £50 million. There may also be some exit costs payable to the US contractors responsible for the EMAL system."

Later that day on the World at One programme Mr Hammond estimated that the change in policy would cost £100 million: the cost of design work, shutting down these projects and fitting ski ramps for use by the STOVL aircraft.

We contacted the Ministry of Defence to clarify where this figure of £100 million came from. They informed us that the figure was just an internal estimate, and pointed out that negotiations for the cancellation of contracts were still underway.

By contrast Mr Murphy claimed that the Government's change of policy would cost £250 million. We contacted his office and they informed us that this figure was taken from the Telegraph.

The Telegraph article concerned claims that the Government had spent more £250 million on changes to the aircraft carrier and it cites "defence industry sources." Without knowing the Telegraph sources we cannot check the accuracy of this figure.  

So we just have to sit tight and wait?

It is concerning, of course, that both parties are locked in debate without either figure being verifyable - in particular Labour's £250 million costing based on the Telegraph's sources. Mr Murphy has called on Mr Hammond to publish the details of the costings on the Labour Party website.

Until these estimates are in the public domain, the public are left in the sorry state of affairs of having no way to judge either politician's claim. 

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