The Australian government’s view that the Oaks nuclear submarine project is “too big to fail” could increase the risk of rising costs, a US Congressional Inquiry has warned.
The Congressional Research Service also questioned whether rigorous cost-benefit analyzes were conducted before Australia, the United States and the United Kingdom announced projects in 2021.
CRS has released an update to an earlier report that investigated plans for the US to sell at least three Virginia-class submarines to Australia in the 2030s, before Australian-built nuclear submarines enter service in the 2040s. .
The report specifically cites comments made by Australian Defense Minister Richard Marles in an interview with Guardian Australia’s politics podcast last year.
Mr Marles said at the time that Australia, the US and the UK were “deeply committed to our mutual success on this project”, adding: "This project has put all three countries in a position too big for either of them to fail. “There is,” he said. countries”.
However, the CRS report warned that such an attitude could contribute to budgetary blowouts, stating that “acquisition projects deemed too big to fail run the risk of increased costs and are less likely to be accomplished.” Some observers have argued that it may become less cost-effective.”
The report cites a 2020 paper that says managers are more likely to complete large projects when they recognize that “once they begin, they are too big to fail and too costly to cancel.” There is a tendency to allocate more funds to
The report highlights 2018 Congressional testimony by then-NASA Inspector General, who said, “When it comes to NASA’s larger and most important missions, there is a ‘too-big-to-fail’ mentality.” “has permeated the agency’s thinking,” and cost overruns have led to delays in other projects.
Oaks submarine is ‘too far away’ to be involved in Taiwan Strait program: US military commander – videoCRS also pointed to a parliamentary submission by retired Royal Australian Air Force Airman EJ Bushell criticizing the management of Australia’s F-35 Joint Strike Fighter acquisition program.
“Despite a series of increasingly critical reports from various US governing authorities…both US and Australian defense and military officials have declared that ‘the project is too big to fail’ and that ‘there is no alternative'” It’s neither. That’s true,” Bushell wrote in a 2012 post.
CRS is an independent service that provides policy briefs to the U.S. Congress without making firm policy recommendations.
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In its latest document, CRS revived discussion of a controversial policy option it previously presented as an alternative to the US proceeding with the sale of three to five Virginia-class submarines to Australia.
Under this option, known as a “separation of labor,” the U.S. Navy would retain ownership of all Virginia-class submarines, but some would be operated from Australian naval bases.
CRS explained that the US-owned submarines would serve both US and Australian missions, while Australia would redirect funding dedicated to the Oaks submarines to building other military capabilities. ammunition, a B-21 long-range bomber, or other long-range attack aircraft. ”
While the idea is attractive from a US perspective, it would have significant implications for Australia’s sovereign control of submarines. There is no indication that the Australian government is open to such an option.
Green Party defense spokesman David Shoebridge wrote of X that from an Australian perspective the division of labor “looks more like a strategic capitulation than a partnership”.
CRS reiterated Marles’ comment that as part of the Oaks Agreement, Australia had not made a prior commitment to join the US in a war with China over Taiwan.
“Australia will convert its (submarines) from boats that can be used in a US-China crisis or conflict to boats that may not be able to be used in a US-China crisis or conflict,” the report said.
US President Joe Biden announced the Oaks security partnership in September 2021 during a video call with then Australian and British Prime Ministers Scott Morrison and Prime Minister Boris Johnson.
However, before making this announcement, CRS will consider whether Pillar 1 is a more cost-effective way to spend defense resources to create deterrence and combat capabilities than potential alternatives. He said there was “little indication” that “a rigorous comparative analysis had been undertaken”. actions such as the division of labor between the United States and Australia.”
