FSTA - Cancel PFI and buy outright?
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PN
I'm not sure if the Wikipedia entry is entirely correct; it implies that the contract with Airtanker has already been signed. However, this was the last progress report that I saw from the MOD:
6 June 2007
New RAF tanker and transport aircraft programme approved by MoD
Have I missed something?
I'm not sure if the Wikipedia entry is entirely correct; it implies that the contract with Airtanker has already been signed. However, this was the last progress report that I saw from the MOD:
6 June 2007
New RAF tanker and transport aircraft programme approved by MoD
"The Ministry of Defence and AirTanker Ltd will now work together to secure financial and contractual close on a PFI deal as quickly as possible."
I don't own this space under my name. I should have leased it while I still could
LFFC,
I was not suggesting (I hope) that Wikipedia was accurate. I was hoping to find some earlier, or out of date, references to support SouthBound's contention that we were not planning an 'active' AAR capability but were seeking a contingent capability with the aircraft used for revenue when not needed for AAR.
I would love to have seen the scheduling plot. Given a civil utilisation of better than 10 hours per day it would follow that a given airframe would be fully employed when not on AAR and that short notice surge would be nigh impossible.
Of course unlike loaded and self-loading freight fitting and testing AAR kit might take more than 30 minutes!. How many AAR platforms would be needed? To guarantee an airborne AAR for a given mission would you need one or two tankers?
To maintain a UK Q do you need a tanker?
What about a trail etc etc?
I was not suggesting (I hope) that Wikipedia was accurate. I was hoping to find some earlier, or out of date, references to support SouthBound's contention that we were not planning an 'active' AAR capability but were seeking a contingent capability with the aircraft used for revenue when not needed for AAR.
I would love to have seen the scheduling plot. Given a civil utilisation of better than 10 hours per day it would follow that a given airframe would be fully employed when not on AAR and that short notice surge would be nigh impossible.
Of course unlike loaded and self-loading freight fitting and testing AAR kit might take more than 30 minutes!. How many AAR platforms would be needed? To guarantee an airborne AAR for a given mission would you need one or two tankers?
To maintain a UK Q do you need a tanker?
What about a trail etc etc?
South Bound
Ok nuances. Chicken and Egg. The original plan was that only if PFI could be proven to work would the EP money be given up. Now of course the EP is strapped for cash so the funding line for a conventional procurement was "withdrawn" which of course means that it can be diverted elsewhere. The fact is that AAR was/is still the priority and the fleet sizing was based on the UK AAR requirement.
All I was questioning was the original comment:
Which is incorrect.
Where the confusion may lie is that a "core" fleet of FSTA will always be in RAF service and these will be tankers that do AT. If the UK Military needs more AAR or AT then this can be "bought in" to meet the additional requirement. These are the swing fleet a number of which had been planned to be released to the civil market when not required by the MOD/RAF. But then of course when the planning was done we weren't fighting 2 minor wars and needing every asset we had!!!
And LFFC you are correct. No contract has yet been signed!!!
Ok nuances. Chicken and Egg. The original plan was that only if PFI could be proven to work would the EP money be given up. Now of course the EP is strapped for cash so the funding line for a conventional procurement was "withdrawn" which of course means that it can be diverted elsewhere. The fact is that AAR was/is still the priority and the fleet sizing was based on the UK AAR requirement.
All I was questioning was the original comment:
That was given up years ago when they decided there was no requirement for AAR
Where the confusion may lie is that a "core" fleet of FSTA will always be in RAF service and these will be tankers that do AT. If the UK Military needs more AAR or AT then this can be "bought in" to meet the additional requirement. These are the swing fleet a number of which had been planned to be released to the civil market when not required by the MOD/RAF. But then of course when the planning was done we weren't fighting 2 minor wars and needing every asset we had!!!
And LFFC you are correct. No contract has yet been signed!!!
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Oh, and if we're talking of re negotiating / changing the contract / throwing in last minute injects in the vinegar strokes....
Any chance of throwing a boom on it and giving it a UAARSI ?(Credited to D-IFF_ident from FSTA - When ? Thread
)
Those boys on the C-17 must be dying to do more than the usual cargo runs and a bit of low level NVG stuff. Plus, we could do plenty of US fighter / 135 stuff over the North Sea with our counterparts.
And it would save all those new / inept co's some face in the desert when they accept a flight of F-16's for a refuel
Just a thought.......
Any chance of throwing a boom on it and giving it a UAARSI ?(Credited to D-IFF_ident from FSTA - When ? Thread
)Those boys on the C-17 must be dying to do more than the usual cargo runs and a bit of low level NVG stuff. Plus, we could do plenty of US fighter / 135 stuff over the North Sea with our counterparts.
And it would save all those new / inept co's some face in the desert when they accept a flight of F-16's for a refuel
Just a thought.......
The boom and girly-flaps UUARSI option is not part of the FSTA requirement. Neither will the OzAF KC-30B have a centreline hose.
I vaguely recall some FSTA conference last century which ststed that the requirement was to support one major (cf GW1) and one minor (cf Malvinas) operation, plus routine AD and AAR training and 'CPT' such as Red Flag. I think the Bennyland Air Bridge was also part of the assumption.
We pointed out to the high-priced help that ther assumptions for 'call-back' of FSTAs off bucket-and-spading were a crock - every liitle Bliar war has always needed everything on Day One. They didn't like that - it didn't fit their cosy assumptions...
As for the Malvinas run - one 'bit of a bugger' is that the A330 has a wingspan 1 metre too big to fit in the Timmy hangar. Which means the de-icing had better be pretty good if the jet has to sit out in the open all the time... Perhaps that'll relax the Q tanker RS if the alternative is to de-ice it every hour?
Although an MPA-based A400M with a single CBT would be able to meet all the in-theatre task need for 1312 Flt.
I vaguely recall some FSTA conference last century which ststed that the requirement was to support one major (cf GW1) and one minor (cf Malvinas) operation, plus routine AD and AAR training and 'CPT' such as Red Flag. I think the Bennyland Air Bridge was also part of the assumption.
We pointed out to the high-priced help that ther assumptions for 'call-back' of FSTAs off bucket-and-spading were a crock - every liitle Bliar war has always needed everything on Day One. They didn't like that - it didn't fit their cosy assumptions...
As for the Malvinas run - one 'bit of a bugger' is that the A330 has a wingspan 1 metre too big to fit in the Timmy hangar. Which means the de-icing had better be pretty good if the jet has to sit out in the open all the time... Perhaps that'll relax the Q tanker RS if the alternative is to de-ice it every hour?
Although an MPA-based A400M with a single CBT would be able to meet all the in-theatre task need for 1312 Flt.
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Beags, at the time you are talking about, the number of aircraft to be provided was around 24, the current figure is 13. If those tasks were and still are required to be met Air Tanker are not often going to have spare capacity for the bucket and spade trade.
Arters, that was before the numbers were ever revealed. For the A310 or B767 it looked to be around 24 as you say.
But then someone evidently thought that with an aircraft carrying 110 instead of 73 tonnes, i.e. if you assume a 10 tonne t/o, reserve, approach etc total, then perhaps 24 x (63/100) = 15 might work. Less crews to pay, less ac to maintain, less hangarage needed....
Only one slight flaw with that plan - 'twas bolleaux.
One u/s jet out of 24 sitting on the line = 96% still available
One u/s jet out of 15 sitting on the line = 93% still available.
But since when did the RAF ever have only 1 u/s jet?
And, most important of all, it is quite common not to need 110 tonnes in any one place, but 55 in two places.....
But then someone evidently thought that with an aircraft carrying 110 instead of 73 tonnes, i.e. if you assume a 10 tonne t/o, reserve, approach etc total, then perhaps 24 x (63/100) = 15 might work. Less crews to pay, less ac to maintain, less hangarage needed....
Only one slight flaw with that plan - 'twas bolleaux.
One u/s jet out of 24 sitting on the line = 96% still available
One u/s jet out of 15 sitting on the line = 93% still available.
But since when did the RAF ever have only 1 u/s jet?
And, most important of all, it is quite common not to need 110 tonnes in any one place, but 55 in two places.....
Although an MPA-based A400M with a single CBT would be able to meet all the in-theatre task need for 1312 Flt.
Let's see the A400M actually doing what we are buying it for before we think about using it as a solution to our tanker problem. It is showing all the signs of turning into another delayed, over-cost, Euro-political fiasco. How long before it reaches the same unit cost as the C-17?
At least we actually want the A330.
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PFI- A crock?
Well, yes...
But for three reasons - firstly, any kind of hire-purchase / lease is going to cost more than straight purchase as the cost of borrowing the capital by the private sector will be more than the cost of the government borrowing the money.
Second, any self-respecting private company will negotiate a watertight contract to protect themselves and to ensure that they can make some money at this game - all very sensible. This is where Pr00ne and his mates come in, and do a good job. The downside for the RAF is that any changes to contract will only be possible in exchange for some money.... lots of it!
Thirdly, at least one point of PFIs was to transfer risk to the private sector - if they didn't perform, then they didn't get paid. If they were more expensive than they thought, then they lost money on the deal.
All very sensible, except for one smallish issue: the Government has to be ok with binning a project if the company providing the service goes bust - like Metronet doing up the tube. The smallish problem occurs when the service is so important that the Government needs it done at almost any cost, at which point the Government is over a financial barrel becuase the service HAS to be provided, so the State will have to stump up the cash to bail out the service provider.... like in Metronet's case....
Seems to me that AAR is a rather vital service without which the RAF is um, well, stuffed, and therefore emphatically NOT suitable for risk transfer to the private sector.
And this is all before we get to the operational issues of where are the bucket and spade brigade going to be going when the RAF needs them, who (RAF!) is repsonible for maintaining commercial ETOPS clearance in the midst of TACEVALs and all the rest of it.
Pity, as I wonder how many we could've bought with the money that's been spent on the project to date...
Juat my 0.02.....
S41
But for three reasons - firstly, any kind of hire-purchase / lease is going to cost more than straight purchase as the cost of borrowing the capital by the private sector will be more than the cost of the government borrowing the money.
Second, any self-respecting private company will negotiate a watertight contract to protect themselves and to ensure that they can make some money at this game - all very sensible. This is where Pr00ne and his mates come in, and do a good job. The downside for the RAF is that any changes to contract will only be possible in exchange for some money.... lots of it!
Thirdly, at least one point of PFIs was to transfer risk to the private sector - if they didn't perform, then they didn't get paid. If they were more expensive than they thought, then they lost money on the deal.
All very sensible, except for one smallish issue: the Government has to be ok with binning a project if the company providing the service goes bust - like Metronet doing up the tube. The smallish problem occurs when the service is so important that the Government needs it done at almost any cost, at which point the Government is over a financial barrel becuase the service HAS to be provided, so the State will have to stump up the cash to bail out the service provider.... like in Metronet's case....
Seems to me that AAR is a rather vital service without which the RAF is um, well, stuffed, and therefore emphatically NOT suitable for risk transfer to the private sector.
And this is all before we get to the operational issues of where are the bucket and spade brigade going to be going when the RAF needs them, who (RAF!) is repsonible for maintaining commercial ETOPS clearance in the midst of TACEVALs and all the rest of it.
Pity, as I wonder how many we could've bought with the money that's been spent on the project to date...
Juat my 0.02.....
S41
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Thanks for the debate guys, it echoes my thoughts. There's little chance of the contract as-is doing what's needed, and there's no money in the defence budget to change that.
Which comes back to the Treasury being asked to stump up. Which in itself requires someone with balls at the top to demand it, on pain of the dogs of war being unleashed. I don't see that happening either.
Which comes back to the Treasury being asked to stump up. Which in itself requires someone with balls at the top to demand it, on pain of the dogs of war being unleashed. I don't see that happening either.
I don't own this space under my name. I should have leased it while I still could
Following on from Squirrel there is also round 2.
First time the PFI Contractor is in open competition. Second time round he has a firm grasp of the potential profit and loss and can rebid accordingly. In theory his bid may be lower than competitors as he now has experience of the real risks. OTOH it may be much higher because he knows the risks.
The counter bid may never materialise. We are X-years down market and competitors may have been taken over, change direction etc. In our last rebid out of 5 contractors one dropped out early 3 were chosen and one dropped out on the last day.
Both bids came in substantially above the budgetted figure. We could either redesign the contract to shave capability but it was already pretty thin or t ake services back in-house but that was not an option as we had shed capability. The contractor got his price. Already the writing is on the wall as we approach round 3. The contractor is already squealing as his margins are already squeezed. We are simply going to have to reserve more cash for round 3.
First time the PFI Contractor is in open competition. Second time round he has a firm grasp of the potential profit and loss and can rebid accordingly. In theory his bid may be lower than competitors as he now has experience of the real risks. OTOH it may be much higher because he knows the risks.
The counter bid may never materialise. We are X-years down market and competitors may have been taken over, change direction etc. In our last rebid out of 5 contractors one dropped out early 3 were chosen and one dropped out on the last day.
Both bids came in substantially above the budgetted figure. We could either redesign the contract to shave capability but it was already pretty thin or t ake services back in-house but that was not an option as we had shed capability. The contractor got his price. Already the writing is on the wall as we approach round 3. The contractor is already squealing as his margins are already squeezed. We are simply going to have to reserve more cash for round 3.
MayI suggest that when the 330 spec is written for the contract ensure that the third set of passenger doors either side of the aircraft are made full width passenger doors rather than narrow emergency exit type ones.Going for the latter reduces the max pax figure and makes the aircraft less desirable on the lease market.
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PN, quite right.
This is the nub of the problem with contractorisation in this form; if there is no credible option to bring the "service" back in-house, then the MoD will simply have to pay whatever the market demands. The double-bugger of this is, of course, that you'd have to decide well in advance that you wanted to have the people and expertise avaliable in-house for this to be a realistic option - you've otherwise got to rely on transfering the existing staff into the MoD as civilians (possible, but expensive) or getting them all to join up (effectively impossible, even if it were desirable).
Given that FSTA is a 20+ year contract, it's less of an issue here, but the general point is right. Which leads to an interesting series of questions about MFTS....
S41
This is the nub of the problem with contractorisation in this form; if there is no credible option to bring the "service" back in-house, then the MoD will simply have to pay whatever the market demands. The double-bugger of this is, of course, that you'd have to decide well in advance that you wanted to have the people and expertise avaliable in-house for this to be a realistic option - you've otherwise got to rely on transfering the existing staff into the MoD as civilians (possible, but expensive) or getting them all to join up (effectively impossible, even if it were desirable).
Given that FSTA is a 20+ year contract, it's less of an issue here, but the general point is right. Which leads to an interesting series of questions about MFTS....
S41
I don't own this space under my name. I should have leased it while I still could
Squirrel, little bird tells me that most contracts are going to get longer. It may enable them to discount the future more but wait for that sting in the tail.
Certainly from my little corner it is working provided it does not cost any money. A bit like the old days pre-human asset counting with spare manpower, being paid regardless, whether there was work or not. Good management could direct them to where it mattered.
Now, within one contract, flexibility is restored but you try to deploy contractor X to contractor Ys unit for a surge!
Certainly from my little corner it is working provided it does not cost any money. A bit like the old days pre-human asset counting with spare manpower, being paid regardless, whether there was work or not. Good management could direct them to where it mattered.
Now, within one contract, flexibility is restored but you try to deploy contractor X to contractor Ys unit for a surge!
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Perhaps hurt by recent speculation, it looks like AirTanker are fighting back:
£13bn RAF tanker deal is ready for lift-off - Telegraph 11 Nov 07
Meanwhile, another report in the same newspaper suggests that FSTA could be toast:
MoD in £1bn battle to stay within budget - Telegraph 11 Nov 07
Looks like this is all going to get very messy or perhaps it's all part of the final negotiation.
£13bn RAF tanker deal is ready for lift-off - Telegraph 11 Nov 07
Meanwhile, another report in the same newspaper suggests that FSTA could be toast:
MoD in £1bn battle to stay within budget - Telegraph 11 Nov 07
The RAF and Royal Navy look poised to take the brunt of the squeeze with the possibility that projects such as the Eurofighter programme, the RAF's Future Strategic Tanker and the Trident replacement programme could be axed.
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Serious question marks exist over the future of the RAF's Future Strategic Tanker, a new air-to-air refuelling aeroplane, as some of the private companies involved in its production are struggling to raise cash for the project.
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Serious question marks exist over the future of the RAF's Future Strategic Tanker, a new air-to-air refuelling aeroplane, as some of the private companies involved in its production are struggling to raise cash for the project.
Last edited by LFFC; 11th Nov 2007 at 12:17.
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Off-topic alert....
The 'Square Wheels' nickname probably didn't stick for long - but I believe it had something to do with a Nimrod R1 at Wyton and why you couldn't, at the time, only do starred item checks when one Hyd system was out, or somesuch - as it meant that one would land with the brakes applied. Doing so can make the wheels somewhat 'square'. Allegedly.
The 'Square Wheels' nickname probably didn't stick for long - but I believe it had something to do with a Nimrod R1 at Wyton and why you couldn't, at the time, only do starred item checks when one Hyd system was out, or somesuch - as it meant that one would land with the brakes applied. Doing so can make the wheels somewhat 'square'. Allegedly.
And then of course this isn't going to help........
http://http://www.timesonline.co.uk/...cle2848830.ece
When are CAS and CINCAIR just going to say "NO". We cannot close airfields and disband squadrons just to save money!!
http://http://www.timesonline.co.uk/...cle2848830.ece
When are CAS and CINCAIR just going to say "NO". We cannot close airfields and disband squadrons just to save money!!
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Hmmm.
Roland...
I take it that means, "No, I'm resigning over this and will publicly say why. And so's he, and so's he." (CAS, CINCAIR, AOCINCs 1Gp, 2Gp, 3Gp?)
No, thought not.
But if these figures are right, and they're serious about no more money, then this sort of force loss to protect Trident's replacement shows it's true cost. And IMHO, it's way too high: so faced with this, MOD should recommend binning Trident.
And then let's see what No 10 has to say....
S41
I take it that means, "No, I'm resigning over this and will publicly say why. And so's he, and so's he." (CAS, CINCAIR, AOCINCs 1Gp, 2Gp, 3Gp?)
No, thought not.
But if these figures are right, and they're serious about no more money, then this sort of force loss to protect Trident's replacement shows it's true cost. And IMHO, it's way too high: so faced with this, MOD should recommend binning Trident.
And then let's see what No 10 has to say....
S41