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Tuesday, April 16, 2024

New fighter jets costing even more

Norway’s long-debated new F35 fighter jets from the US are setting off another cost bomb for the new Norwegian government. The latest numbers from the defense ministry suggest they’ll now cost around NOK 90.2 billion, well over even an adjusted and expanded budget that itself was way above initial estimates.

Norway’s new fighter jets started arriving four years ago, but now their costs are soaring once again. PHOTO: Forsvaret/Armée de I’air

Most of the cost uncertainty and latest feared increase is tied to fluctuations in the value of Norway’s currency. That’s happened before: Norway’s krone has varied from as low as NOK 5.4 to the US dollar, to as much as NOK 11.4 during the period since 2012, when the Norwegian Parliament approved purchase of the jets from US defense contractor Lockheed Martin.

Back then, Norway’s order for 52 jets was expected to cost a total of NOK 42 billion. There was great uncertainty at that time as well, sparking lots of concern and debate over the order before it got the nod. Norway needed to replace its fleet of ageing F16 jets, and the deal went through. It didn’t take long before there was talk, even within the Labour Party-led government at the time that backed the order in 2012, of trimming it from 52 to 46 jets, to save money.

Now Labour is back in government power, and facing the immediate budget bomb reported by newspaper Klassekampen. The paper has written about how the price-tag for the F35 order (which remained at 52 jets) has now soared to more than twice initial estimates.

The NOK 90.2 billion (nearly USD 11 billion) now appearing in documents attached to the state budget proposal for next year has also soared beyond the already-adjusted price tag of NOK 80 billion, which in turn had been raised from an estimated NOK 73 billion in 2017. The fighter jet program has been referred to all along as Norway’s single largest acquisition ever made.

Prices in general are also rising in the post-pandemic period. It’s all led to renewed calls from the Socialist Left party (SV) for an audit of the F35 program and more transparency in how the much higher costs will affect other areas of defense spending. Ingrid Fiskaa, a Member of Parliament and defense spokesperson for SV, told Klassekampen that there’s great uncertainty over how much of next year’s increase in defense spending will have to go towards the fighter jets at the cost of other areas.

Asked how the new Labour-Center government’s new defense minister should address this, Fiskaa called for “more openness” on the actual costs and what options the ministry has.  She’s wondering whether some parts of the investment project can be cancelled, adding, though, that the ministry usually replies that contracts have been signed. She won’t rule out retreat opportunities.

“This will continue to be a cost bomb for the military, that seems clear to me,” Fiskaa told Klassekampen. “We need a realistic debate over what this means.” Berglund



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