Typhoon Tranche 3 Deal in Limbo

[ORAC]

Typhoon deal in Treasury limbo (http://www.defencemanagement.com/news_story.asp?id=9240)
Monday, April 20, 2009

A compromise to divide the final tranche of Eurofighters into two orders was thrown into chaos over the weekend after the Treasury decided to re-examine the MoD's proposal and request for funds.

After months of discussions, Germany, Britain, Spain and Italy reached an agreement with EADS to split the final order into two parts. Britain would order 40 Typhoons in the first order and 48 in the second. From these orders 72 of the aircraft would be sold to Saudi Arabia, leaving Britain with just 16 aircraft. All of the aircraft Britain is keeping would be ordered in the first tranche, leaving the MoD in need of immediate money.

The plan to divide the order can only go through if the Treasury authorises approximately £1.4bn for the purchase of the 16 aircraft. But Treasury officials, who are under immense pressure to make cuts across the government, are taking another look at the order according to the Financial Times. (http://www.ft.com/cms/s/0/cb295874-2b74-11de-b806-00144feabdc0.html)
Defence Secretary John Hutton has become involved in recent days, pleading with the Treasury for the funds, highlighting the number of jobs at stake and the potential for the entire deal with EADS to collapse.

There is much at stake for all parties involved in the Eurofighter deal. The buyers all want a split order for the planes in order to produce savings in their defence budgets. A Treasury veto would effectively kill the agreement with EADS and could lead to the company demanding that all of the planes be bought in one order.

Alternatively the four countries could simply decide not to buy the planes at all if the Treasury orders a rethink on the purchase. This would produce severe financial consequences for EADS and BAE Systems and could lead to job losses.

The MoD would only admit that discussion continue with the Treasury but that "good progress" was being made.

[ProM]

Unfortunately the dickweeds we have in power have spent all the money on initiatives, health advertising and other wonderful ego projects. They now have to save money, but not having the courage of their convictions and trying desperately to cling to power they have promised £15bn of savings without cutting jobs or services.

How will this £15bn be magically saved? Easy. Just delay (not cancel), just delay,lots of big defence projects. No civil servants sacked (Brown & Darling aren't to blame for defence contractor jobs are they?). No services cut, and our boys and girls are doing a fine job and we will send them the best kit...just not yet.

[Double Zero]

Personally,

Having seen M.Thatcher refuse the P1216 STOVL project ( after the Harrier saved her arse ) I don't think there's much to chose between politicians, the only good example being one roasting on a spit...

If we're going to bother having a defence force - be it Navy Type 45's, Astute sub's, or Tranche 3 Typhoons, let's do it properly or forget it !

Wasn't so difficult to come up with megabucks for bankers ( take that as rhyming slang if you will ) was it ?!

[Chainkicker]

Defence Secretary John Hutton has become involved in recent days, pleading with the Treasury for the funds, highlighting the number of jobs at stake and the potential for the entire deal with EADS to collapse.
Nice to see Hutton being concerned with the effect this would have on the Armed Forces and letting the appropiate Minister lobby them about the potential job losses...Errm :rolleyes:

[iccarus]

Double Zero

I take great exception to your use of 'Margaret Thatcher' and 'spit roasting' in the same sentence.......:yuk::yuk::yuk:

[HarrysHawk]

The word 'politics' is derived from the words 'poly', meaning 'many', and 'tics', meaning blood-sucking parasites.

Think that just about sums it up, really.

[Double Zero]

Iccarus,

As you may have guessed I didn't mean it that way, and now feel quite ill at the image you allude to !

DZ

[phil gollin]

So, is the money still there to update the TRanche 1 and 2 to later standards ?

.

[hulahoop7]

Still doens't make sense to me. The Saudis bought early bockTranche 2 jets didn't they? The UK thereby delaying its own order and getting later block Tranche 2s?

So surely the Saudi's can't be taking tranche 3 jets???

Or is it some horribly complex offset from one tranche to another? :confused:

[Jackonicko]

Some Government ministers make it their stock in trade to say what they think their audience want to hear, offering vague and extremely qualified assurances in response to questions.

Others simply don't directly awkward questions, answering the question they'd wanted to answer instead, usually by repeating a line from their pre-prepared media brief.

Others are more straightforward (though seldom much more useful).

On being asked how his government would now fulfil the remainder of FRC, and how it would address the 37% shortfall in battlefield helicopter lift identified by the NAO, Labour's Minister for Defence Equipment and Support, Quentin Davies, today talked about the order for 12 re-engined Lynx 9s, the eight Chinook HC3s and six ex-Danish Merlins, and denied that this was insufficient. He refused to be drawn on a proper replacement for the Puma, and would not even give a vague hint or an unspecified piece of meaningless reassurance. There obviously isn't any Government policy for such a thing. Or not yet, perhaps?

But he wasn't just going to tell us what we wanted to hear.

But yesterday at Coningsby, after mentioning air defence, after roasting the 'pacifistic and unilateralist' tendencies of the Lib Dems and after and boasting of his government's commitment to giving the forces the kit it needs, he gave unexpectedly clear and unambiguous support when asked about Typhoon Tranche 3.

A journo stood up and said something like: "Nice to hear you speak up for Air Defence, sir, and to criticise the Lib Dems' Unilateralism and Pacifism. They want to cancel Typhoon Tranche 3, are you prepared to express your support for it?"

He was, he said. While the Treasury had questioned and investigated the Tranche 3 proposal, he said that he hoped that "a positive decision will come very quickly", insisting that there was a "definite need" for Typhoon Tranche 3 which "has been a consistent requirement for the UK's future national defence."

This was a more unequivocal statement than I've had from Willie Bach, Brian Burridge, Glenn Torpy or even Paul Drayson - all of whom I've asked to give a similarly clear commitment to Tranche 3 over the years.

And it was more than his words - Davies got fired up and clearly enthusiastic, and said what he said in front of a hangar full of invited guests, BAE personnel, Cottesmore folk, and about a dozen press peeps. He reiterated that support for Tranche 3 at Yeovil, today.

I can't over-stress how shockingly new this was, and what a departure it was from anything I've heard from Ministers before. Had there been any journos there from the Dailies (rather than JDW, Flight, Bloomberg and a rag tag of assorted freelances) I think it might have hit the headlines.

I can only conclude that the Government is now properly committed to Tranche 3, and that any Treasury pressure to go back on it will be firmly resisted.

This is pretty welcome stuff in my view. The Umbrella contract is for 620 Typhoons - 232 for the RAF (eg all three Tranches) and there would be stiff financial
penalties for the UK government if we tried to withdraw, as well as a massive loss of workshare, and at the moment, some 40,000 of the 100,000 Europe-wide jobs on Typhoon are UK jobs (3,400 with BAE).

But Typhoon's not about jobs. It's proving to be a great swing role aircraft, and is getting better and better all the time. Tranche 3 will form the bedrock of future planned capability for the RAF and is vital to the service's long term future.

In combination with what he said about the Lib Dems and Tories (he was a bit embarrassingly party political and "on the attack" at Cottesmore) it made me think that Labour must think that Defence is going to be an election winner this time, and that they can exploit Tory and Lib Dem weakness on the issue. He roasted the Tories for their failure to support the Carrier programme and JSF, and what he called 'the escort ships' (T45, presumably) and promised to hold them to account on this. He insisted that the Tories
would be "a disaster for defence", and said that the Conservative Party should publicly commit to the carrier programme and stop criticising without offering alternative solutions.

At Yeovil today he was also fulsome in his praise of the "very brave men" who put their lives on the line on our behalf, and was keen to express his, the Government's and the country's gratitude to our servicemen. He seemed sincere.

[jindabyne]

We can but hope Jacko --

[glad rag]

he hoped But he did not say "yes" Dream on. :ouch:

[soddim]

I sincerely hope he does not just talk the talk.

This government has not long to go now, thank God, but it would do us all a favour if they honoured Tranche 3.

[StopStart]

hangar full of invited guests, BAE personnel, Cottesmore folk,

Hope they all recover from the nasty burns I assume they all got having all that sunshine blown up their arses.... :hmm:

I take it he didn't mention anything about our creaking, nay, broken AT fleet did he? No, thought not. All political horsesh*t.

[22/7 Master]

And Typhoon is where you think Defence should be centred then?

The government has latched onto this as it meets their criteria - Its big, expensive, shiny and as it is not relevant it cannot be seen to fail. Very zaNU Labour.

Buy the bloody things and flog them to the highest bidder - reduce the through life costs as much as we can whilst maintaining UK jobs.

So the minister only committed to the SH we have already got - Merlin Mk3a, Chinook Mk3 and the white elephant and budget waster that is Future Lynx.

No mention of a replacement for the overstretched Sea King or Puma (no chance I hear you say), the road-smash that is TacAT or the uneasyjets of Strat AT.

It is a very expensive and dismaying game of Blind Man's Buff - The government is ging the wrong way - though this time the upper echelons of the Air Staff are entirely culpable for 'spinning' them in the wrong direct.

Typhoon is what we have, but we don't need 232 of them and can well cope with half that number - that's still bigger that the UK SH Fleet (and with no tangible role for the foreseeable).

[Double Zero]

Jacko,

While journalist shooting is regarded much like ' Space Invaders ' as good fun here, I happen to appreciate your attempt to put some good news across.

I'm not the biggest fan of Typhoon myself, but as said elsewhere if Tranche 3 was cancelled any ' saving ' would go anywhere but defence, so we might as well have it, might come in handy one day !

As for other projects - or lack thereof - such as helicopters, all I can hope is one thing at a time.

That subject has been a scandal for years, and let alone military helo's, why are hospital air ambulances funded by charity in a supposedly 21st century country...

DZ

[Jackonicko]

More relevant than Grey Funnel Lines two big cocktail party decks, HMS White Elephant and HMS Wasteful, which Mr Davies is also enthusiastic about.

And we can't cope with 116 aircraft. (Half of 232).

Five squadrons is the number needed for UK AD, and (with an OEU, Falklands and OCU) that would require a FAF of 101 aircraft, requiring a buy of at least 170.

But since the Typhoon is required to replace F3 and Jag, the original seven squadron total doesn't seem too many, especially if we use some of the late Tranche 3 jets to replace some of the GR4s, and especially if the Carriers and JSF get the bullet they deserve.

So we need 232.

Let's remember the original justification for 232 jets.

Total RAF FAF: 137 aircraft
Squadrons: 105 aircraft (15 each)
OCU: 24 aircraft
OEU: 4 aircraft
Falklands: 4 aircraft

In-use reserves: 9 aircraft
(one per squadron and two with the OCU)

The remaining 84 would have been rotated in and out of service to balance flying hours across the whole fleet and thus enable the aircraft to meet its scheduled out-of-service date. They would also have covered attrition losses.

Giving a total of 232 aircraft.

[airmail]

Jacko, I don't want to be cynical but his 'unequivocal support' and 'criticism of the other parties' could also be viewed from the standpoint that there is an election coming up in the next year or so. As the current Government could easily delay a decision until after then and, according to the latest polls, Labour would be lucky to be the third party in the House, they will not have to make the decision. As whomever is elected would more than likely cancel Tranche 3 due to UK debt etc etc, it would give Labour a defence & employment platform to shout about.

As I say, I don't want to be cynical but they are politicians....

[backseatjock]

I was interested to see comments (from RAF or Quentin Davies?) that Harrier could possibly continue in service beyond 2018. Is this down to nervousness about Lockheed's ability to deliver F35 against current plan?

Don't share your view Jacko about carriers being a total waste of cash. Who knows what defence threats we might face in 20 or more years time and where we might have a need to project our influence to support the defence of our sovereignty and/or allies.

[insty66]

Isn't the right honourable:yuk: an MP who "crossed the floor" without giving his constituents the right to re-elect him in his new guise?

Don't trust him, or many others tbh

[Jackonicko]

Backseatjock,

Reported comments about Harrier post-2018 were very much RAF, and very much in response to repeated journo probing. Quentin expressed complete confidence that JSF would be on time, even denying that the programme had been subject to any delay or any problems so far.

My opposition to carriers isn't because I don't think that they might not be useful one day, it's that the budget is so tight that we simply can't afford the 'nice to have' niche capabilities, when we can't even afford enough of the everyday essentials and core roles.