Super 64
20th Oct 2006, 01:31
From The Australian – 20 Oct 06
Aerospace botched tender for choppers
Mark Dodd
20oct06
AUSTRALIAN Aerospace increased its 15-year maintenance bill for the new Tiger Armed Reconnaissance Helicopter fleet by 85 per cent shortly after winning a $1.96 billion defence contract.
Under scrutiny yesterday from federal parliament's Public Accounts and Audit Committee, the company admitted mistakes were made in the bidding process, but struggled to justify the massive increase in through-life helicopter support (TLS) contracts.
Asked by Labor senator Mark Bishop to explain the cost blow-out, chief executive Joseph Saporito said the original tender specifications had been hard to tally.
After France, Australia will be the first country to receive the Tigers, with 22 on order.
But the project has been plagued with problems, ranging from delays in the delivery of simulator training systems to engine power troubles. The Government has already received $286,000 in damages for delays, a figure that looks set to rise to $10million.
"It seems there has been at best an irregularity in the tendering process to the tune of hundreds of millions of dollars that has resulted in your company getting the contract," Mr Bishop said.
"How do you respond to that? How can you be out in through-life costs somewhere between $365 million or $625million?"
After a long pause, Mr Saporito, struggled to find a satisfactory answer.
"It was difficult to know exactly what would be the cost for the TLS for our competitors. We made our best to give some estimates," he said. "Some estimates were not accurate."
Six of 22 Tigers on order - one squadron - would be "operationally" ready by next June.
"We believe we'll have aircraft No12 ready for acceptance - that is, signed off and accepted by the commonwealth - in the third quarter of 2007," said acquisitions manager Bob Wilson.
But even that estimate was contradicted by the Defence Force yesterday.
In reply to questions from The Australian, a defence spokesman said the first Tiger squadron was not expected to become fully operational until December 2008.
The choppers are not the only army equipment order running into problems.
More than a year overdue, the first of the army's upgraded armoured personnel carriers will now enter service late next year.
The $585million M113 overhaul involves comprehensive upgrades to 350 of the army's venerable Vietnam-era APCs.
Like the Tiger, changing specifications over several years had resulted in a slew of development problems.
Was the Tiger such a good idea? Or will it yet again be an ADF acquisition that didn’t quite do what was promised, even after coming in late and over budget.
Combine this with the OH 58D Warrior's proven record in Iraq and given we could have gotten far more 22 for the same price. Was Tiger the best choice? Or plan B could have been we waited a little longer for the Rh 70, with first (US) delivery scheduled for February 2008, with first combat-ready unit due in fourth quarter of 2008.
S64
Aerospace botched tender for choppers
Mark Dodd
20oct06
AUSTRALIAN Aerospace increased its 15-year maintenance bill for the new Tiger Armed Reconnaissance Helicopter fleet by 85 per cent shortly after winning a $1.96 billion defence contract.
Under scrutiny yesterday from federal parliament's Public Accounts and Audit Committee, the company admitted mistakes were made in the bidding process, but struggled to justify the massive increase in through-life helicopter support (TLS) contracts.
Asked by Labor senator Mark Bishop to explain the cost blow-out, chief executive Joseph Saporito said the original tender specifications had been hard to tally.
After France, Australia will be the first country to receive the Tigers, with 22 on order.
But the project has been plagued with problems, ranging from delays in the delivery of simulator training systems to engine power troubles. The Government has already received $286,000 in damages for delays, a figure that looks set to rise to $10million.
"It seems there has been at best an irregularity in the tendering process to the tune of hundreds of millions of dollars that has resulted in your company getting the contract," Mr Bishop said.
"How do you respond to that? How can you be out in through-life costs somewhere between $365 million or $625million?"
After a long pause, Mr Saporito, struggled to find a satisfactory answer.
"It was difficult to know exactly what would be the cost for the TLS for our competitors. We made our best to give some estimates," he said. "Some estimates were not accurate."
Six of 22 Tigers on order - one squadron - would be "operationally" ready by next June.
"We believe we'll have aircraft No12 ready for acceptance - that is, signed off and accepted by the commonwealth - in the third quarter of 2007," said acquisitions manager Bob Wilson.
But even that estimate was contradicted by the Defence Force yesterday.
In reply to questions from The Australian, a defence spokesman said the first Tiger squadron was not expected to become fully operational until December 2008.
The choppers are not the only army equipment order running into problems.
More than a year overdue, the first of the army's upgraded armoured personnel carriers will now enter service late next year.
The $585million M113 overhaul involves comprehensive upgrades to 350 of the army's venerable Vietnam-era APCs.
Like the Tiger, changing specifications over several years had resulted in a slew of development problems.
Was the Tiger such a good idea? Or will it yet again be an ADF acquisition that didn’t quite do what was promised, even after coming in late and over budget.
Combine this with the OH 58D Warrior's proven record in Iraq and given we could have gotten far more 22 for the same price. Was Tiger the best choice? Or plan B could have been we waited a little longer for the Rh 70, with first (US) delivery scheduled for February 2008, with first combat-ready unit due in fourth quarter of 2008.
S64