Budget officer says used Australian fighter jets will cost Canada over $1 billion — far more than DND claimed

DAVID PUGLIESE, OTTAWA CITIZEN

The purchase of used Australian jets to boost Canada's current fleet of fighter planes could cost taxpayers more than $1 billion, a figure 22-per-cent higher than the Department of National Defence is claiming, according to a new report from parliament's financial watchdog.

Parliamentary Budget Officer Yves Giroux examined the cost of buying and upgrading 18 used Australian F-18s and flying them to 2032. His report, released Wednesday, puts the final price tag at between $1.09 billion and $1.15 billion — considerably more than the $895.5 million estimate from DND.

“We considered the entire life-cycle cost, from project management up until the very end of the disposal phase,” Giroux said in an interview with Postmedia. “We didn't look at whether it was a good deal.”

The PBO's costing included weapons, upgrades needed for the aircraft, annual maintenance fees and the fuel that would be needed over the years of flying the aircraft.

We didn't look at whether it was a good deal

The Royal Canadian Air Force is using the jets as interim fighters to boost the capability of the current fleet of CF-18s until the purchase of a new generation of aircraft. The RCAF will fly 18 of the Australian jets and use the other seven for parts and testing.

The RCAF received its first two used Australian fighter jets at 4 Wing Cold Lake in Alta. on Feb. 16. Deliveries of the jets will continue at regular intervals for the next three years, and the aircraft will be integrated into the CF-18 fleet as modifications are completed, according to the RCAF. The last aircraft are expected to arrive by the end of 2021 and fly until 2032.

Giroux said his office used the same figures that DND had but did its own analysis of those cost estimates. “There's no fundamental reason why we should come up with a different number,” he said. “My only sense is that they voluntary budgeted optimistic numbers. The reason why I don't know for sure.”

In a statement Wednesday, DND said its cost figures are close to those determined by the Parliamentary Budget Officer. The statement also added that the PBO figures for upgrades of the interim fighter fleet include estimates for CF-18 combat upgrades which the department is still trying to determine. “While we are confident that our methodology is sound, we will continue to work with the PBO, the Auditor General of Canada, and other outside entities as part of our commitment to responsible use of taxpayer dollars,” the statement noted.

The Liberal government had planned to buy 18 new Super Hornet fighter jets from U.S. aerospace giant Boeing to augment the Royal Canadian Air Force's CF-18s until new modern aircraft could be purchased in the coming years.

But in 2017 Boeing complained to the U.S. Commerce Department that Canadian subsidies for Quebec-based Bombardier allowed it to sell its C-series civilian passenger aircraft in the U.S. at cut-rate prices. As a result, the administration of U.S. President Donald Trump enacted a tariff of almost 300 per cent against the Bombardier aircraft sold in the U.S. In retaliation, Canada cancelled the deal to buy the 18 Super Hornets, which would have cost more than US $5 billion.

Instead of buying the new Super Hornets, the Liberals decided to acquire the used Australian jets.

In November 2018 the Auditor General's office issued a report noting that the purchase of the extra aircraft would not fix the fundamental weaknesses with the CF-18 fleet which is the aircraft's declining combat capability and a shortage of pilots and maintenance personnel.

“The Australian F/A-18s will need modifications and upgrades to allow them to fly until 2032,” the report said. “These modifications will bring the F/A-18s to the same level as the CF-18s but will not improve the CF-18's combat capability.”

“In our opinion, purchasing interim aircraft does not bring National Defence closer to consistently meeting the new operational requirement introduced in 2016,” the report added.

The Canadian Forces says it is bringing in new initiatives to boost the numbers of pilots and maintenance staff.

https://montrealgazette.com/news/canada/budget-officer-says-used-australian-fighter-jets-will-cost-canada-over-1-billion-far-more-than-dnd-claimed/