ANALYSIS: Advance Purchase Could Well Put Defence Out On A Wing
(Source: Australian Strategic Policy Institute; issued November 28, 2009)
Kevin Rudd this week made a $3 billion bet on the US-made F-35 joint strike fighter as the linchpin of the RAAF's future combat force.

The government is convinced that its bold strategic move to buy the F-35, which is still being flight tested before going into full production, will keep the RAAF's future combat arm way ahead of all other regional defence forces when it comes to fielding superior military technology.

With its stealthy characteristics and its remarkable range of onboard sensors, the F-35 comes with the promise that it will easily outperform its next-generation rivals including Russian and Chinese-made aircraft.

"The JSF's combination of stealth, advanced sensors, networking and data fusion capabilities, when integrated into the networked Australian Defence Force, will ensure Australia maintains its strategic capability advantage to 2030," Defence Minister John Faulkner declared on Wednesday.

In what is certain to become the country's biggest defence purchase during the next decade the RAAF plans to acquire as many as 100 F-35s, or four fighter squadrons, at a projected cost of $16bn.

Defence's latest estimate is that the first operational squadron will be up and running by 2018-19 with three operational squadrons in total, which is 72 aircraft, in service by 2021.

Once again Australia has become the lead customer for a hi-tech US combat aircraft that remains years away from proving itself as a fully capable platform.

Starting with the purchase of the F-111 bomber by the Menzies government in 1963, Australian governments have opted for highly advanced weapons systems. But these have often run years late when it comes to actually entering service with the Australian Defence Force.

Australia will now buy production aircraft well ahead of Britain and other European partners that have pledged a much greater financial investment to the JSF program than has Canberra.

The multinational effort aims to build about 3,000 of the "fifth generation" fighters.

In betting on the F-35 this week, Rudd and his senior ministers are not just focused on the need to plan carefully for the replacement of the frontline fighters in use by the RAAF.

The F/A-18 Hornets are rapidly reaching the end of their service life and from next year to at least 2018 a single squadron of Super Hornet fighters, due to enter service in 2010-11, combined with about 40 elderly "classic" Hornets, will form Australia's frontline air defence.

Australia's commitment to buy the JSF sends a powerful political signal to Washington about Canberra's willingness to help ensure the F-35 evolves into a highly successful program that already involves eight other nations in concert with the US.

The biggest risk remains that the F-35 test and certification program will continue to slide to the right, leaving the RAAF's ambitious aircraft renewal plan in disarray.

Already the RAAF's timetable for initial operational capability has slipped by at least two years as budget pressures bear down on the Defence Department.

Seven years ago, when then defence minister Robert Hill announced Australia's intention to sign up to the JSF program, with an initial investment of $300 million, the planning assumption was that the F-35 would enter service from 2012, replacing the F-111 strike force and the F/A-18 fighters.

Three years ago the government's defence capability plan still assumed that the "initial operating capability" for the new fighter would be achieved by 2014.

Fast-forward to today and that timetable has already slid out to 2018.

Budget considerations have led the Rudd government to adopt a conservative approach to the F-35 buy, committing this week to an initial batch of just 14 aircraft, easing pressure on the government's forward estimates spending to 2014.

The $3.2bn bill is not just for aircraft. It also includes a large investment in new facilities and logistic support and training for the F-35s with the main training base to be built at RAAF Williamtown in NSW.

Faulkner says the F-35 will be bought in batches with a decision on the next batch due to be made in 2012. This is expected to include an additional 58 aircraft together with all the necessary supporting equipment to establish three operational squadrons as well as a training squadron of F-35s.

The government hopes by then that the F-35 development will have progressed to the point where full-rate production promises to bring down the fly away cost of each plane.

For some of Australia's leading defence experts, who have carefully tracked the progress of the F-35's development during the past decade, this week's decision by cabinet's national security committee is a big leap of faith given the range of issues that could adversely affect the F-35's production schedule.

If the F-35 runs late and the RAAF fails to get its first operational squadron by 2018-19, the government could be forced to reassess its acquisition strategy and look at other options, including buying extra Super Hornets.

"I can't understand why the government has made a decision now," says Mark Thomson, of the Australian Strategic Policy Institute and the country's leading expert on the defence budget.

"They could have kept their options open and made a decision when they had more information about cost, schedule and the capability that will actually be delivered," he tells Inquirer.

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