Cost of new submarines blows out to $225bn

The cost to build and maintain Australia’s new fleet of submarines will hit about $225bn over their 50-year lifespan.

Future Submarine program manager Rear Admiral Greg Sammut. Picture: Supplied

The cost to build and maintain Australia’s new fleet of Attack-class submarines will hit about $225bn over their 50-year lifespan, Defence has admitted.

Defence officials and the government had previously said the 12 new boats would cost $50bn to build and $50bn to sustain. But that was in “constant” dollars, which don’t account for inflation.

Future Submarine program manager Rear Admiral Greg Sammut told Senate estimates on Friday that the “out-turned” cost of the boats — the actual cost of the subs when the money is spent — was estimated to be $80bn.

And he revealed the out-turned cost of sustaining the boats until their scheduled retirement, in about 2080, was estimated to be $145bn, although this was only a “rough estimate”.

Rear Admiral Sammut also ­revealed construction of the first sub would not start until 2024, up to a year after the previously ­quoted date. He said the original 2022-23 schedule referred to the readiness of personnel, tools and processes to start building the first sub’s pressure hull.

Opposition defence spokesman Richard Marles said the cost and construction timeline for the ­Future Submarines were continuing to blow out. “This is the most ­expensive acquisition Australia has ever bought and we have now learnt it is 60 per cent more ­expensive than we were first told,’’ he said.

“The government needs to come clean about when the first of the Future Submarines actually become operational.”

Experts have questioned whether the 12 French-built boats — which will be the world’s largest and most expensive conventional subs — are a good fit for Australia, given their limitations in range and ability to stay under water compared to nuclear-powered subs.

Australian Strategic Policy ­Institute analyst Marcus Hellyer, who had previously calculated the out-turned cost of the subs at $79bn, said taxpayers deserved to know the true cost.

“It does raise the issue: what capability does it actually get you?” he told The Weekend Australian. “It’s supposed to be regionally superior, but it’s going to be up against nuclear submarines. And so we are paying $80bn to acquire 12 conventional submarines that will be coming into a world where the bad guys have got nuclear-propelled submarines, and there will be lots and lots of autonomous underwater vessels out there.

“We are spending $80bn on a capability that could be in big trouble at some point.”

The first Attack-class boat is not scheduled to enter service until about 2035.

Chief of Navy Michael Noonan recently left open the prospect that some of the Attack-class sub could be nuclear-powered.

However, Defence Minister Linda Reynolds said they would be diesel-electric boats, as planned.

She also rejected suggestions the subs would be technologically obsolete by the time they hit the water.