Australian nuclear submarine program to cost up to $368b as AUKUS details unveil

[ozbob]

ABC News --> Australian nuclear submarine program to cost up to $368b as AUKUS details unveiled in the US

Australia's nuclear submarine program will cost up to $368 billion over the next three decades, with confirmation that the federal government will buy at least three American-manufactured nuclear submarines and contribute "significant additional resources" to US shipyards.

Key points:

The AUKUS-class submarines will be operated by both the UK and Australia, using American combat systems.

One submarine will be built every two years from the early 2040s through to the late 2050s

From as early as 2027, four US submarines and one from the UK will start rotating through Western Australia ,,

[ozbob]

ABC News --> What is AUKUS and when are we getting nuclear submarines?

After a year and a half of negotiations with America and the United Kingdom, we finally have the current plan for how and when Australia will get its own nuclear-powered submarines.

The price tag has been described as "eye watering", and it'll be decades until they're all in the water. ...

[ozbob]

https://twitter.com/10NewsFirst/status/1635450701517307904

[ozbob]

$368b is just the start cost estimate.  It will increase of course, even if just inflation.

I think there will be serious infrastructure funding shortfalls as a consequence.

Defence is important, but I think they should have just obtained already tested and operational subs.

Building new navy craft is a bit like building a new train, but with a complexity many more orders of magnitude.

It is risky, and costly.  Costs always increase.

The cost will also drain other defence funding as well.

[verbatim9]

Australia needs serious tax reform now to help pay for this new AUKUS agreement, as well as other vital infrastructure and services. Broaden the GST to include health and food as well as raise it to 15%.  Moderate alcohol taxes at the same time. #AUKUS #Taxreform #GST #Australia

https://twitter.com/verbatim18/status/1635459196031475712

[ozbob]

New and higher taxes is the only way it can be achieved. 

I don't think citizens will take too kindly to that, but even more so to service cuts  (health, transport, education, welfare etc.).

New Daily --> Paying for AUKUS? Spending like Europe means taxing like Europe

Scott Morrison says that to accommodate the AUKUS submarines deal, Australia's defence budget will need to increase to 2.5 per cent of GDP, and there's not much doubt he's right.

That's an extra $10 billion or so per year, on top of a structural deficit of $50 billion a year, already rising to $70 billion. Make that $80 billion.

So where is the money coming from? Tax increase or spending cuts?

Alternatively, of course, we could relax and learn to love deficits and debt – like Japan and Europe.

The broader problem is that the cost of running Australia has gone up a lot in the past few years, and with the defence spending needed for today's tense geopolitics it will go up some more. ...

[verbatim9]

That's right, through broader higher consumption taxes like in Europe and Canada are the way to go. People will not mind paying higher taxes in this way in return for improved infrastructure and services. The private health sector also needs to play a greater role in health to help alleviate the health budget. The pharmacy sector needs to be deregulated to allow for corporate contribution, thus leading zero subsidy from the Federal Government over time.

^^We all want better and faster regional rail services as well as improved urban transit infrastructure and services. Let's get the tax regime fixed up. Support tax reform now!

[#Metro]

Gina Rinehart net worth is ~ 30 billion. This is ~10x that.

[Gazza]

The private health sector also needs to play a greater role in health to help alleviate the health budget.

Private sector health increases costs rather than decreasing them.

Eg america has a private healthcare system, they spend more per capita than countries with public systems, and despite spending more you they have people missing out on care.

[SurfRail]

The cost of these projects are being given over a timeframe of something like 60 years and includes crewing, maintenance and ongoing ops.  It sounds a lot more than it actually is.

[Gazza]

Ah the old SRL trick.

[SurfRail]

It's certainly not cheap, but to suggest it is all a sunk (no pun intended) cost is also wrong.  Leaving aside the fact most of the sustainment and operational expenditure isn't leaving the country, this is going to result in big big bucks spent on STEM to produce the workforce needed to actually run the things - and that has plenty of flow-on benefits.  We're probably talking building up a nuclear skills ecology comparable to (or in excess of) most other countries with nuclear power stations and other high energy physics applications apart from the ones that operate nuke boats themselves, of which there are currently only 6, all nuclear weapons states as well (the 5 permanent UNSC members plus India) and another coming (Brazil, no nuclear weapons).

[verbatim9]

The private health sector also needs to play a greater role in health to help alleviate the health budget.

Private sector health increases costs rather than decreasing them.

Eg america has a private healthcare system, they spend more per capita than countries with public systems, and despite spending more you they have people missing out on care.

I believe that Singapore's health system is predominantly private with pretty good outcomes. Maybe the sheer size of population in America causes some people to miss out. Despite that America has far more advanced medical treatments and technology than that of Australia.   

[verbatim9]

Brisbane Times--->https://www.brisbanetimes.com.au/politics/federal/what-a-368-billion-submarine-price-tag-means-for-the-budget-20230314-p5crtr.html

The age pension is forecast to cost a cumulative $800 billion over the coming decade, with the National Disability Insurance Scheme not far behind at $695 billion. The interest bill on the federal government's gross debt is forecast to cost more than $500 billion over the coming decade

[verbatim9]

Looks like Australia will be going into trillions of debt. Good bye AAA rating, hello higher borrowing costs for both the government and private sectors.

This can be overcome with proper tax reform.

[Gazza]

America has a smaller population than the EU, so you can't attribute population size to people missing out.

[verbatim9]

America has a smaller population than the EU, so you can't attribute population size to people missing out.

You can't compare USA to EU as the EU has no administrative role. You would need to compare each individual country. The ratio of private health care to state owned healthcare has been steadily growing in Germany and the UK.

[Gazza]

Yeah well I just did compare them so deal with it 

[#Metro]

New and higher taxes is the only way it can be achieved.

I don't think citizens will take too kindly to that, but even more so to service cuts  (health, transport, education, welfare etc.).

New Daily --> Paying for AUKUS? Spending like Europe means taxing like Europe

Wow. $368 billion!

RIP HSR FUNDING 

[ozbob]

^

https://twitter.com/ozbob13/status/1635459120907325440

[ozbob]

Brisbanetimes --> 'We need to respond': Mammoth submarine outlay sparks budget battle

... But the Greens said the increase in defence spending would require future cuts to health and education and warned they would not help in parliament to make any savings, while the Coalition warned against "cannibalising" other defence programs to pay for the submarines.

China, which possesses its own fleet of nuclear-powered submarines, railed against the plan, accusing the AUKUS partners of undermining international non-proliferation and fuelling an arms race in the region. ...

[ozbob]

Brisbanetimes --> We've bet everything on subs that will be obsolete by the time they arrive

... Manned submarines are nearing the end of their utility in hostile waters because of developments in smart sea mines, unmanned underwater vehicles (UUVs) and underwater sensors. China has already made a strong start on this, and will deploy them in large numbers in its coastal region and strategically important areas of the South China Sea and East China Sea. ...

[ozbob]

https://twitter.com/markhumphries/status/1636298386176606209