Estimates of the cost of the next generation U.S. fighter jet aren't believable, a senior Defence Department official said Thursday as he insisted the program's price tag must be reined in for the American military to purchase more than 2,400 aircraft for the Air Force, Navy and Marine Corps.
Ashton Carter, who oversees acquisition, also said there are no alternatives to the F-35 Joint Strike Fighter, a stealthy aircraft manufactured by Lockheed Martin, and the Defence Department was working to make the program affordable. The jet fighter's costs have increased 26 per cent while its schedule has slipped five years due to design changes, problems with software development and technical problems.
Eight other countries — including Canada — also are planning to purchase the aircraft.
Prime Minister Stephen Harper has stood firmly by his cost estimates for the stealth fighters — about $9 billion (U.S.) for 65 planes — despite the Pentagon's rising cost predictions. He has said there are cost increases in the U.S. program that have no impact on Canada.
Democrats and Republicans on the U.S. Senate armed services committee expressed frustration Thursday with the program, the Pentagon's largest acquisition effort. Ten years into the program, the cost has jumped from $233 billion to $385 billion (US). Recent estimates say the entire U.S. program could exceed $1 trillion over 50 years.
"If we live the estimates, we can't afford to pay that much," Carter told the Senate Armed Services Committee. "I don't think we have to live those estimates and that's our objective is to make sure that those estimates don't come true and that we do have an affordable program."
Exasperated members of the committee pressed the Defence Department officials and a Lockheed Martin executive on what steps they were taking to get the program in line, explaining that Washington's push for fiscal austerity would not allow excessive spending on the aircraft.
"We cannot sacrifice other important acquisitions in the [department] investment portfolio to pay for this capability," said Senator Carl Levin, a Michigan Democrat and chairman of the committee.
The panel's top Republican, Senator John McCain of Arizona, put it more bluntly.
"No program should expect to be continued with that kind of track record, especially in our current fiscal climate," McCain said.
Carter said the Pentagon would have a better idea in the next few months on the cost of the Joint Strike Fighter as officials were closely scrutinizing the program. He stressed that there was no reliable alternative and the military had to have the plane.
Michael Sullivan, an analyst with the Government Accountability Office, told the committee that the aircraft program "has not fully demonstrated that the aircraft design is stable, manufacturing processes are mature and the system is reliable."
But Carter rejected any suggestions about changing the design.
"The last place I want to go is dumb down the aircraft," he said.
Tom Burbage, executive vice-president and general manager at Lockheed Martin, said he understood the committee's concern on the schedule and cost and said the company was "committed to drive down costs in the face of challenging fiscal realities."
McCain pressed Burbage on what were the "handsome returns to shareholders" of Lockheed Martin compared to the non-existent returns for the American taxpayer. Burbage said he could not provide the numbers.
Ottawa stands by price to buy 65 jets
In Canada, the Conservatives have fought a pitched battle with the opposition parties and the parliamentary budget officer over their figures for the jets. When the purchase of 65 stealth fighters was first announced, the Tories said the price tag was $9 billion for the aircraft and up to $7 billion more for 20 years' of maintenance.
In defending the price, Canada's Defence Department said it will pay between $70 million (U.S.) and $75 million (U.S.) for each aircraft, a figure that the parliamentary budget officer has disputed.
The prime minister has repeatedly warned that Canada's CF-18 fighter jets, which the Joint Strike Fighter is meant to replace, will soon reach the end of their service life.
Meanwhile, a former Canadian defence official, who once championed the F-35 but is now one of its fiercest critics, has called Harper's price explanations absurd.
Alan Williams, who headed procurement at National Defence until 2005, said the U.S. would not sell the fighter to Canada at less than what its own military pays.
Canada is among the allies in the F-35 program who gather annually to list the number of aircraft they intend to buy in any year. The Pentagon then negotiates the price with Lockheed Martin. In theory, the more aircraft that are built, the lower the unit cost.
The agreement signed by Ottawa last summer binds Canada with its allies. If one country decides to pull out or not purchase in a particular year, as Turkey has signalled it will do, costs rise for the countries remaining in the pool.