Australia will be forced to pay up to Aus$5.5 billion (US$4.1 billion) to exit a submarine deal with France in favour of acquiring nuclear-powered US or British models, officials admitted Friday.

Last year Australian Prime Minister Scott Morrison tore up a submarine deal with France's Naval Group, instead opting for nuclear-powered alternatives as part of a landmark security agreement with Washington and London.

On Friday, under questioning from an opposition senator, defence officials revealed the scuppered French deal came with a hefty price tag.

"So taxpayers will be up for $5.5 billion in submarines that don't exist?" senator Penny Wong asked at a hearing in Canberra.

"The final negotiated settlement will be within that price," Defence Department deputy secretary Tony Dalton replied.

Dalton said the exact amount was still unclear as negotiations with Naval Group were ongoing.

Finance Minister Simon Birmingham defended the decision to ditch the French deal as "necessary for decades to come".

"There's no shying away from the fact that we knew there were serious consequences," Birmingham said.

"The changed strategic environment in the region meant that the option that had previously been chosen was not going to meet the best needs for Australia in the future."

Morrison previously said the decision to opt for nuclear-powered submarines was driven by changing dynamics in the Asia-Pacific region, where China is increasingly asserting its claims to almost the entire South China Sea.

The switch caused fury in Paris, with French President Emmanuel Macron accusing the Australian leader of lying about the future of the contract initially worth Aus$50 billion.

In December, a study released by the Australian Strategic Policy Institute said the nuclear-powered submarine programme would cost more than US$80 billion and take decades to complete.

al/axn

NAVAL GROUP

Related Links
Naval Warfare in the 21st Century

Tweet

Thanks for being here; We need your help. The SpaceDaily news network continues to grow but revenues have never been harder to maintain. With the rise of Ad Blockers, and Facebook - our traditional revenue sources via quality network advertising continues to decline. And unlike so many other news sites, we don't have a paywall - with those annoying usernames and passwords. Our news coverage takes time and effort to publish 365 days a year. If you find our news sites informative and useful then please consider becoming a regular supporter or for now make a one off contribution.
SpaceDaily Contributor $5 Billed Once credit card or paypal		SpaceDaily Monthly Supporter $5 Billed Monthly paypal only

Australia plans to host US, UK nuclear subs
Sydney (AFP) March 15, 2022
Australian Prime Minister Scott Morrison announced Tuesday his government is readying the country's ports to host nuclear-powered submarines from Britain and the United States. Morrison said his defence department would determine what was needed "to support the more frequent presence" of nuclear-powered submarines from the two ally nations. The move could provide the two nuclear powers with better access to the Indian Ocean and the South Pacific, challenging China's growing maritime power. M ... read more