Australia to pay French submarine builder $835 million for breaking contract

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,” 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.

Naval Group said it would present to Australia the invoice of what it will have to pay for the expenses that the company and its industrial partners had already paid or had agreed to, in accordance with what was stipulated in the contract.

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.

During a press conference, Albanese said he hopes to travel to Paris soon to meet with French president Emmanuel Macron, with whom he had finalized the details of the agreement that could end diplomatic tension between the two countries.

“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,” 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.”

SOURCE: NEWS AGENCIES