Something needs to be said about this business of the government “hiding” $10 billion in costs on the F-35, suggesting the cost was only $15 billion when it was “really” $25 billion. Well, it’s true that they lied about the cost being $15 billion. It’s true that they’re lying now about this just being a misunderstanding about accounting — if that was true, why wouldn’t they have said so when the Parliamentary Budget Officer came out with his $30 billion figure, rather than accusing him of simply making it up?
But it’s also true that the $25 billion figure is still cooked. It’s baloney. It’s based on obsolete pricing data, and on a “plan” for the use of this jet fighter which can only be descirbed as bogus: the notion that we will only be using the plane for 20 years before it is replaced. Obviously this is not true. We will be using the CF-18s for around 30-40 years. The F-35 will be around at least that long. DND’s long-term plan starts at 36 years’s use for the F-35, and presumably goes up from there. So, what will the F-35 actually cost us?
It’s not an easy question to answer, but here’s an analysis based on current costs. First, buying 65 aircraft is supposed to cost $9 billion. Based on current analysis from the Pentagon, that cost should be more like $10.5 billion. It’s true the Americans may end up paying a slightly different figure per plane than we do, but it’s a safe bet that if their purchase costs are going up, ours are too. Contrary to Harper’s prating during last year’s election, we’ve signed a memorandum of understanding fixing research and development costs, not a “contract” fixing the purchase price.
Second, sustainment and operating costs. The official figure is either $6 billion (public figure) or $16.2 billion (internal figure). Neither is correct, because that’s based on using them just 20 years and then replacing them with another, even more expensive aircraft. Figure the true lifespan will be 40 years — slightly longer than DND’s current plan, but much shorter than the Americans’ 50-year use strategy. Unless you’re prepared to believe that Canada will be replacing the F-35 30 years before the Americans do. Yeah, right.
That means the operating costs will be about $32.5 billion — provided, as I’m sure everyone who’s ever owned a badly aging car will agree , that maintenance costs in its 40th year will be the same as maintenance costs in its 10th year.
Third, the government will need to purchase new F-35s along the way in order to cover losses, attrition, etc. In the official public estimates, the government claims it will lose or retire a single airframe, ever, in the entire life cycle of the F-35. But DND admitted to the Auditor-General that it would need to purchase at least 14 additional aicraft, given current assumptions about attrition. That’s another $2.2 billion.
Fourth, the government has suggested there will be no need for software or hardware upgrades over the next 40 years, apparently based on the very wise observation that the computer technology I’m using to write this blog is pretty much the same as I could have purchased off the shelf in 1973 (help me out on this, older readers: I’m not off base here, am I?). The Auditor-General suggests this will be $1.2 billion over the fake 20-year lifecycle, which means it will be at least $2.5 billion over my realistic 40 year life cycle.
Finally, the Auditor General notes that the current F-35 budget provides enough weapons and other combat-related supplies to keep each plane in operation 45 days. Seems to me this could be left out of the budget (we’d need the weapons regardless of what plane we bought), but since DND included the 45-day estimate (total: $300 million) in the public budget, I’ll include it in mine too. That $300 million figure is for 20 years, and builds in use of existing stock from the retiring CF-18 fighters. Assuming a doubled lifespan, the exhaustion of the CF-18 reserve weapons, and rising costs to do with more sophisticated combat technology, it seems reasonable to tack on another $1 billion. Of course, if we choose never to use the plane in combat, it’ll be somewhat cheaper.
That leaves us with a grand total of $48.7 billion. Assuming, once again, that some time within the next 40 years the Royal Canadian Air Force will become so well funded that it can afford to replace its F-35s one or more decades before the Americans replace their F-35s. If we stretch it out to 50 years the way they plan to, our costs approach $60 billion.
Of course, it’s worth wondering whether we’ll still be using manned jet fighters for any purpose into the 2060s or 2070s. But the Americans say we will be. And we can all trust the Americans, can’t we?Tweet