The Australian government will pay French shipbuilder Naval Group $835 million in compensation, after last year's decision to tear up a $90-billion contract to build 12 submarines.
Prime Minister Anthony Albanese made the announcement this morning, saying the total amount of money spent by Australian taxpayers on the program is now $3.4 billion.
"This is a saving from the $5.5 billion that Senate estimates was told would result from that program," Mr Albanese said.
"But it still represents an extraordinary waste from a government that was always big on announcement but not good on delivery, and from a government that will be remembered as the most wasteful government in Australia's history since federation."
The scrapping of the French submarine contract last September was a result of Australia entering the AUKUS security alliance with the United States and the United Kingdom, and gaining access to nuclear submarine technology.
The incident caused a deep fracture in diplomatic relations between Australia and France, with French President Emmanuel Macron going so far as to accuse then prime minister Scott Morrison of lying to him about the future of the contract.
"I'm looking forward to taking up President Macron's invitation to me to visit Paris at the earliest opportunity, and we will make further announcements forthcoming about the dates in which that will occur," Mr Albanese said.
"I see a personal meeting between myself and President Macron in France as being absolutely vital to resetting that relationship, which is an important one for Australia's national interests.
"The tensions between Australia and France, I think, have been pretty obvious and they go from the top — I intend to have an honest relationship with France and one that is based upon integrity and mutual respect."
Shadow Defence Minister Andrew Hastie was quick to question the merits of the deal, avoiding any ties to the $835 million figure and the previous government.
"There were private conversations with Defence, but this is a settlement which Mr Albanese has come to," Mr Hastie said.
"We were aiming for a significantly lower figure."
The Prime Minister used the announcement of compensation between the Australian government and Naval Group to take aim at the former defence minister Peter Dutton, after he angered the diplomatic and military communities during the week by divulging details of sensitive negotiations about the AUKUS deal.
Mr Dutton took to the opinion pages of The Australian newspaper to spruik the prospect of Australia buying two US nuclear submarines this decade to cover a forecast capability gap for the Royal Australian Navy – something he said he believed would be a possibility.
"He hinted, but he didn't say anything when he was defence minister, did he?" Mr Albanese responded.
"Peter Dutton needs to recognise that he has a responsibility to put the national interest first, not to always be engaged in short-term political interests."
When contacted for comment, the French shipbuilder said in a statement that "Naval Group and the Commonwealth of Australia have reached a fair and equitable settlement to bring a conclusion to the Future Submarine Program".
French Defence Minister Sébastien Lecornu was questioned as to whether he was hopeful of any rapprochement between Australia and France.
“I must admit that I was quite expecting this question, so I'm going to answer it very frankly,” he told the Shangri-La Defence dialogue in Singapore.
“The given word is very important to us and the given word has a price has value.
“New Caledonia is still French, it is one of the largest neighbours of Australia.
“So we are neighbours — Paris is not close to Canberra, but undisputedly Noumea is close to Canberra.”
He suggested the change in government could steer the relationship back to smoother waters.
“There have been elections, elections in Australia, elections in France,” Mr Lecornu said.
“In Australia, the previous majority was not re-elected, and in France Emmanuel Macron was re-elected, so, it gives us an interesting discussion framework.”
