The Australian government is paying to maintain seven trouble-plagued Taipan helicopters in a Brisbane warehouse after the navy ceased using them.
Officials have defended the cost of this work, saying it would ensure the parts still have resale value once the government decides whether to dump the fleet entirely.
Australia bought 47 of the MRH-90 Taipan helicopters for use by the army and the navy, but the Howard government-era acquisition had been listed as a “project of concern” since 2011.
The chief of army, Lt Gen Simon Stuart, said the cost of operating a Taipan was “in the order of $48,000 an hour”.
“Despite efforts by all stakeholders, the MRH system has not been able to deliver the expected rate of effort and is more expensive to operate than we can afford over time,” he told a Senate estimates committee on Wednesday.
The navy stopped using the MRH-90 for flying operations seven months ago.
Shane Fairweather, an acting deputy secretary at the Department of Defence, explained that the navy had found it “extremely problematic” to operate the aircraft at sea from the back of a ship.
The navy had a requirement to produce two or three flights at sea, but had only been able to generate one flight at sea, he said.
Seven of the helicopters no longer used by the navy had been moved to an Airbus facility in Brisbane and were being maintained “to preserve the value of the asset”.
Fairweather argued the helicopters and their components would “lose value incredibly” without this upkeep, and that would pose “a far greater cost to the commonwealth than the costs of maintaining them at the moment”.
During the committee hearing, the Greens senator David Shoebridge said “no country in their right mind” would buy these helicopters from Australia before asking: “There might be a sucker out there that buys them?”
Fairweather rejected that characterisation.
“The major components, like gearboxes, engines, radars, mission computers, they all have significant value,” he said. “They need to be preserved and the cheapest way to preserve that equipment is on an airframe under preservation maintenance.”
The then defence minister, Peter Dutton, indicated late last year that Australia was likely to buy up to 40 UH-60M Black Hawk helicopters from the US as an alternative to the Taipans.
Dutton, who is now opposition leader, said during a visit to Townsville last month that it was “very clear to me that the Taipans were not fit for purpose and this was a done deal”. Dutton said he had personally taken “decisive action in ordering the Black Hawks”.
But officials confirmed at Wednesday’s hearing that the former Coalition government had never signed a contract for new Black Hawk helicopters prior to the election.
The Department of Defence gained authority from the then government to make a request to the US as part of the congressional notification process.
Defence has given the new Labor government advice on options so it can make a final decision, but the timing is unclear.
The secretary of the Department of Defence, Greg Moriarty, said it would be “announced by the government when it is ready to do so”.
Defence officials also confirmed on Wednesday that the Australian government would consider an unsolicited proposal from the Spanish company Navantia to build three more ships for the navy this decade.
Navantia’s pitch to build three additional Hobart-class destroyers includes three options: build them in Spain with some modules in Australia; build them in Spain but with the combat system integration largely done in Australia; and build them entirely in Australia.
Defence has asked analysts from Rand Corporation to do a “risk reduction study” on the proposal so the government can weigh up the idea.
Navantia recently submitted a second unsolicited proposal to build six small warships known as corvettes.
