Wednesday, 24 October 2012

Controversial report recommends Federal Government lease nuclear subs to save $10b

AUSTRALIA could save $10 billion by leasing nuclear-powered Virginia Class submarines from the US, says a Centre for Independent Studies report.
Author Simon Cowan also claimed it could save up to $0.75 billion a year in operation and maintenance costs.
The Future Submarine Project Should Raise Periscope for Another Look report from one of the country's most influential think tanks, said arguments against buying nuclear-powered submarines didn't stand up to scrutiny.
And it found leasing the fast attack submarines could avert "a potentially disastrous capability gap developing" between when the six Collins Class are retired and the replacement diesel-powered submarines are designed.
The project is expected to cost $36 billion. The Government has previously ruled out the nuclear option.
Opposition leader Tony Abbott, who previously had a former Centre for Independent Studies research fellow as an adviser, deferred to Defence spokesman David Johnston for a response.
Senator Johnston showed no sign of backing its contents, saying: "The Coalition is not considering a nuclear-powered option" and "work on the project will centre around the South Australian shipyards".
The report went on to rebut claims that Australia could not buy nuclear-powered submarines because it does not have a supporting nuclear industry.
Using a leasing arrangement meant the US could service the subs and also get rid of spent nuclear fuel, it said.

Mr Cowan's report criticised the existing process to replace the ageing Collins Class submarines with 12 new craft, saying the Commonwealth Government's current path "was marred by indecision and waste, conflicts of interest and substandard procurement practices".
SA Treasurer Jack Snelling rejected the nuclear-powered sub plan, saying it would be a wasted opportunity for thousands of jobs.
Mr Snelling said the Commonwealth Government had committed to building the new diesel-powered submarines in Adelaide and "what the US wants from its Virginia Class is different".
"It would make our submarine capability entirely dependent on the US," he said.

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