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New Australian battleship in jeopardy after spending cuts

US Navy receives delivery of newest littoral combat ship"

A new report from the National Audit Office uncovered that of the $8 billion the government set aside for its new Air Warfare Destroyers (AWD) fleet, 60 per cent has already been spent, but there are no completed ships to show for it.

In the past financial year alone, the government has spent more than $106 million on the vessel. Government leaders have placed the blame on the rising cost of labour, skyrocketing material prices and high demand for subcontractors. This has led the Defence Materiel Organisation (DMO) to step in and assess what the problems are, and how to fix them.

"There are emerging concerns from the AWD Alliance around cost overruns and associated delays in shipbuilding aspects of the AWD program," Warren King, CEO of the DMO, said in a December 17 statement.

"An independent review is to be commissioned to identify factors contributing to cost growth and delays, and to recommend remediations and mitigation."

The government has also blamed the high costs on poor productivity and inefficiently built shipyards. Throughout all this, the report also showed about $2 million per week was spent on wastage. What's more, concern has arisen that the Australian government could soon use public funds to spend another $1 billion on the project.

However, government officials say the vessel is imperative for improving the Australian Navy. The first ship is expected to be completed by 2016, and the remaining ships will finish assembly by 2017 and 2019.

"The Government is committed to working collaboratively and constructively with all stakeholders to ensure we realise both the national security benefits and the long-term benefits of the program for the Australian shipbuilding industry in a cost-effective and efficient way," Finance Minister Mathias Cormann and Defence Minister David Johnston said in December 18 joint statement in response to the report.

Interconnect Systems has been operating in the military engineering industry for more than 20 years and developed several products and solutions that will benefit various military projects.

For more information on the best backshells and cable harness solutions, contact Interconnect Systems today at 1800 812 214.

By Philip Shelley

Interconnect Systems



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