Aussie MoD Reports on Troubled LPA Project (Feb. 3)
The Minister for Defence, John Moore, today released two reports on the Navy's Amphibious Transport (LPA) project.
"Shortly after becoming Minister for Defence, I was made aware of significant increases in cost and completion delays for HMAS Manoora and HMAS Kanimbla," Mr Moore said. "I considered these overruns to be totally unsatisfactory, and in August last year, I directed the incoming Chief of Navy, Vice Admiral David Shackleton, to provide me a full report on the project. "I also asked the Inspector General of Defence to review the acquisition of the ships and Defence's management of their conversion and modification.
"I have now received these reports and both indicate the process of acquiring and upgrading these vessels fell well short of performance levels expected by the Government," Mr Moore said.
In mid-1994, the previous Australian Government approved the purchase of two ex-United States Navy Newport Class amphibious landing ships. HMAS MANOORA and HMAS KANIMBLA arrived in Australia later that year, and since mid-1996 have been undergoing extensive modifications to upgrade them to Amphibious Transport Ships (known as LPAs).
The initial project cost was to be $120m at December 1998 prices. Present planning indicates that when the project is completed in late 2000, the final cost could exceed $400 million.
In addition to this three-fold increase in cost, there was a delivery delay of 26 months for the first ship, HMAS MANOORA, from the time of contract, and 35 months for KANIMBLA .
"As Defence Minister, I find these delays and cost overruns totally unacceptable, and I am determined to see Defence management practices improve, particularly in Defence Acquisition," Mr Moore said. "I have instructed the Secretary, Dr Allan Hawke, and the Under Secretary, Mr Mick Roche, to recommend to me improvements in the management of the Department to ensure the experience of the LPA purchase is not repeated in current and future acquisition projects. The entire Department should learn from this unfortunate, costly experience."
"I also have asked Mr Roche to provide me with an urgent status report on the 15 major projects currently being undertaken by Defence. Overall, there are important lessons to be learned for Defence from the handling of this project."
They include the need for:
*properly conducted pre-procurement inspections, particularly of second-hand materiel; * implementation of thorough risk analysis and appropriate risk abatement measures; * full life cycle costing of equipment purchases; * clearly defined operational requirements for the equipment before it is purchased; * dedicated, competent project teams with full access and authority over expenditure of the project's funds; and * more active involvement by senior oversight committees
An LPA Delivery Team has been formed to bring this project to a timely conclusion. Operational sea trials with MANOORA have commenced.
When the project is finalised, the MANOORA and KANIMBLA will provide the Australian Defence Force with significantly enhanced amphibious transport capability over planned service lives of 15 years. It is expected that this capability will be delivered by late this year.
"Notwithstanding the difficulties presented from the outset of this project, the Government is committed to ensuring that MANOORA and KANIMBLA contribute to an efficient and effective amphibious capability, as soon as possible," Mr Moore said.
"With four helicopters and two landing craft per ship, MANOORA and KANIMBLA can each transport 450 troops with vehicles and equipment, and lodge and sustain them ashore. Both ships have a hospital and, importantly, can be used for disaster relief or the evacuation of Australian nationals abroad," Mr Moore said. "They would have been great assets in East Timor."
See the two reports on the Australian LPA program :
