Australian government agrees to pay French submarine contractor Naval Group $835m for canceled 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 spent by Australian taxpayers on the scheme now stands at $3.4 billion.

“This is a savings from the $5.5 billion that the Senate estimates would result from this program,” Mr. Albanese said.

“But this still represents an extraordinary waste of money from a government that has always made lots of announcements but not good results, and a government that will be remembered as the most wasteful government in the history of the world. ‘Australia since federation.’

The abandonment of the French submarine contract last September is the result of Australia’s entry into the AUKUS security alliance with the United States and the United Kingdom, and access to technology nuclear submarines.

The incident caused a deep rift 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 look forward to responding to President Macron’s invitation to be in Paris as soon as possible, and we will make further announcements in the future on when this will happen,” Mr Albanese said.

“I consider a personal meeting between me and President Macron in France to be absolutely vital to resetting this relationship, which is important to Australia’s national interests.

“The tensions between Australia and France, I think, have been quite evident and they start from the top. I intend to have an honest relationship with France and one based on integrity and respect. mutual.”

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French President Macron says Scott Morrison lied about the $90 billion submarine contract that was cancelled.

Shadow Defense Minister Andrew Hastie was quick to question the merits of the deal, avoiding any connection to the $835 million figure and the previous government.

“There were private conversations with the Defense but this is a settlement Mr. Albanese reached,” Mr. Hastie said.

“We are aiming for a significantly lower figure.”

The Prime Minister took advantage of news of compensation between the Australian government and Naval Group to target former defense minister Peter Dutton, after he angered the diplomatic and military communities over the week by disclosing the details of sensitive negotiations on the AUKUS agreement.

Mr Dutton took to the Australian newspaper’s opinion pages to raise the prospect of Australia buying two US nuclear submarines this decade to cover a planned capability gap for the Royal Australian Navy – which he believed be a possibility.

“He hinted, but he didn’t say anything when he was defense minister, did he?” Mr. Albanese answered.

“Peter Dutton must recognize that he has a responsibility to put the national interest first, not always to be committed to short-term political interests.”

Naval Group has been contacted for comment.

French Defense Minister Sébastien Lecornu was asked about his hope for a rapprochement between Australia and France.

“I have to admit that I was quite expecting this question, so I will answer it very frankly,” he said during the Shangri-La Defense dialogue in Singapore.

“The word given is very important to us and the word given has a price has a value.

“New Caledonia is still French, it is one of Australia’s biggest neighbours.

“So we are neighbors – Paris is not close to Canberra, but Noumea is unquestionably close to Canberra.”

He suggested the change in government could bring the relationship back to calmer waters.

“There were 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 that gives us an interesting framework for discussion.”

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