Ottawa’s fighter-jet estimate ‘all hogwash,’ U.S. watchdog warns

The plan to buy F-35 Joint Strike Fighters will cost billions more than the $29-billion estimated by Canada's budget watchdog, a U.S. defence spending analyst says.

"It's going to be significantly more. It's not going to be $1-billion more, it's going to be significantly more," said Winslow Wheeler, a defence-spending watchdog with the Washington-based Center for Defense Information.

The $29-billion estimate from Parliamentary Budget Officer Kevin Page put a startling price tag on the cost of a fleet of 65 stealth jets, though the government insists they will cost about half that amount.

But Mr. Wheeler, a former staffer with the U.S. Government Accounting Office and with both Republican and Democratic senators, said even Mr. Page's estimate – though reasonable now – doesn't take into account key elements that will make the costs rise: problems with the complex planes that will be inevitably be discovered during testing and the slashing of the number of planes to be produced by the United States and its allies.

The Liberals say they'll put the deal on hold, and hold a competition to determine what planes Canada needs. But the Conservatives, and the Defence Department, insist the F-35 is the only "fifth-generation" fighter, complete with stealth technology and next-generation communications available. It will be needed, the government argues, to defend against Russian interlopers and to take on missions like the one the current CF-18 fleet is now doing over Libya.

Ottawa says the planes will cost about $9-billion to buy, and another $6-billion for service over the first 20 years of their life span. That $9-billion cost estimate to buy the fleet includes a package of equipment and modifications to get the planes flying, but pegs the price of each plane at $75-million.

But Mr. Wheeler argues that price tag, once cited as the "non-recurring fly-away" in the United States, has been abandoned by the planes' proponents. It usually doesn't include engines and avionics to get the planes flying, and it includes adjustments to 2002 dollars, plus an ample expectation that the cost of each plane will get markedly cheaper as the manufacturer, Lockheed Martin, learns how to build them more efficiently.

"To get to that number, they use several crude, disingenuous tricks. And they sprinkle a little fairy dust, in terms of 'learning curve' and other magical potions, to pretend it's got some science behind it," he said. "It's all hogwash."

"Ultimately," Mr. Wheeler predicted, "the cost of this airplane is going to be about $200-million per airplane."

In the United States, where the per-unit costs of the F-35 has been cited as $115-million, some defence estimates put it as high as $155-million per plane. But even that doesn't take into account problems that will see it rise even further.

Conservative Leader Stephen Harper says Canada is buying the cheapest, "A" version of the plane – but Mr. Wheeler argues that will only save at most 10 per cent. And the cost of supporting the airplane will be more than buying them, and will also rise.

The biggest problems with the cost estimates is that they don't include allowances for problems looming on the horizon.

The F-35 has only gone through about 10 per cent of developmental tests, so it's still unclear what problems will have to be fixed even though several have been found so far. And the plane is so complex the costs are likely to baloon. For example, the plane's older brother, the F-22, is experiencing pricy problems with its stealth coatings.

"The [F-35] is only about 10 per cent through its developmental flight tests. Those are the easy tests. Those are the laboratory tests. Those tests will be finished in 2016," Mr. Wheeler said. "That's when the operational tests are [to be done]."

And the number of F-35s that will eventually be built will be far less than current official projections, he argued, further increasing the cost per plane.

Several countries, like Denmark and Norway, are still debating whether to buy the planes. Britain is cutting its planned buy, and Turkey has put its plan to purchase 100 F-35s on hold because of a dispute sparked because the U.S. refuses to allow the sale of the software "source code" that allows buyers to modify the systems.

Washington has cut its own plans to buy 2,700 planes to 2,500, and can be expected to reduce it further, Mr. Wheeler said.. The U.S. Defense Department has put the development of one variant of the planes, the "B" version, on probation and a deficit commission suggested dramatically reducing the purchase of other variants.

No one can know the costs of an airplane that's still not developed, but Mr. Wheeler argued the best way to buy a fighter is "a competitive fly-off" of real airplanes. "And make a decision based on real evidence rather than paper studies," he said.