This idea of NZ aquiring a second hand RAN ANZAC Frigate is really starting to annoy me. NZ had the chance to convert 1~2 options on ANZAC frigates to actual orders but declined for whatever reason.
The notion that the RAN should give up one of its already to few surface assets to the RNZN for a bargain basement price is just ridiculous. Why should Australian taxpayers subsidise NZ defence purchases?
The Australian Govt has always paid a premium for defence equipment to have a great deal of the actual expenditure done within Australia to stimulate the economy, create jobs and basically justify the massive costs involved in some programs. We could buy alot of this equipment off the shelf at a considerably cheaper price but choose to make an investment in the skills required for a local defence industry. Plenty of NZ companies can thank the ADF for the majority of their business, in fact the amount of work sent NZ's way is probably disproportionately in favour of NZ.
Basically what I am saying is there is no free ride when it comes to defence. If you want to operate 30-40 year old warships like some South American banana republic then that is fine. But then don't expect to be able to inter-operate with your allies (read USA). Australia faced this fact 10 years ago and we are starting to see the beginnings of NCW in the three services.
Anyway by the time the RAN is finished with these ships they will be close to their use by date.
Hooroo
This idea was thrashed out (in this thread?) a few months ago and I think the consensus was for that to happen it could only occur once the new AWD's are commissioned. Realistically it ain't going to happen.
But if it were to happen for some reason, I don't think anyone here really expects "the RAN should give up one of its already to few surface assets to the RNZN for a bargain basement price" and rip off the Australian taxpayer.
Apparently from what I've read elsewhere there was a suggestion (if that's the correct term to use) from the Australian Govt to the NZ Govt that it could acquire, probably HMAS ANZAC in lieu of NZ opting out of the 3rd new ANZAC Frigate build project. I think a price of NZ$600M (roughly A$500M-odd was mentioned). I suspect the Aus Govt reason, apart from ensuring NZ had a credible combat Navy, was because the first 4 ANZAC Frigates had welding issues (since rectified) and possibly the Aus Govt would simply build an additional new ANZAC replacement for the RAN with the proceeds (after all the RAN would surely be happier to have a new build ANZAC rather than a patch up early ANZAC). I dunno, it's what I've heard but it may simply be a myth or the story has grown some legs but someone else here will know the real details and can elaborate.
(Incidentally, perhaps if the NZ Govt was interested a few years ago, would it have been feasible for NZ to buy one of the FFG's that was recently decomissioned? Or was it too worn out? As National were on the way out in the late 1990's one of their tasks for the MOD/NZDF was to assess other options for the replacement of HMNZS Canterbury, in lieu of signing up for a third ANZAC).
Again someone better qualified than me can explain why the NZ Govt didn't take up the additional ANZAC options. But from my reading of the situation, in 1998 when a decision was required, NZ was suffering from an exchange rate "crisis", the backwash from the Asian economic crisis and because of other competing defence priorities that had become critical as National started to involve the NZDF in more UN Operations such as Bosnia in the early 90's which showed up alot of deficiencies (and as Mr Conservative stated, MMP coalition issues may have played a part). At the time in 1998, two high defence priorities were the F16 acquisition of 28 aircraft (approved) and the 3rd ANZAC Frigate (rejected). As well these there was the procurement of Army direct fire weapons and new comms equipment. Tenders at the time were soon to go out for new armoured vehicles and 4WD vehicles and the $500M P3 ASW and sensor upgrades. So it looks like the 3rd ANZAC was deferred due to other more pressing priorities and I think the option to buy the 3rd ANZAC finally expired around 2001 or 2002 when the new Labour Govt said they weren't interested.
Remember too that although the Australian Govt is paying a premium for locally produced equipment, so is NZ when it purchases Australian made equipment. However you are correct in that NZ companies have benefitted from for example the ANZAC project, hence it is in NZ's best interests to support these types of projects and set out as intended (it's a pity that sometimes domestic politics over here gets in the way). NZ companies benefit, true, but also alot of`Australian companies that are based in NZ such as James Hardie and Tenix, who own NZ's main ship building facility in Whangarei.
Now to answer my question from yesterday, which to recap was:
If an opportunity arose whereby NZ could buy two new, Anzac type frigates for say, NZ$80M for both, would this be a good idea?
Also what if we wanted to have a four frigate navy again, thus spend instead, NZ$160M for four. Would this be a good idea?
From one source I've`read (historian Matthew Wright), the cost for NZ to buy two brand spanking new ANZAC Frigates, when the ANZAC Frigate project was signed in 1988 or 89 was ........ <$80M per year spread over 16 years (i.e. 1989-2005). In other words some $1200M all-up (although the MOD website stated the overall project cost was some $900M back in 2005).
(And obviously I've assumed that if NZ signed up for 4 Frigates back in 1989 it would be paying twice that or $160M per year spread over 16 years).
Ok, some of you may think I've been a bit cheeky or misleading but the reason why I did this was to make people think about defence costs in a different way, perhaps a more realistic way as NZ did not pay Australia some $900-1200M up front at the time!
Despite what the anti-Frigate peace-groups wanted the NZ public to believe at the time. Sure at the time in the 1980's, $1B was an unheard of sum back then (and no wonder the public grumbled, especially as NZ's economy was absolutely FXXXXD at the time and tens (hundreds?) of thousands of people were being laid off, factories closing, companies bitting the dust and NZ public assets were being prepared for sale). No wonder the public protested and the Labour Govt did not want to commit to 4 Frigates up front.
But look at things in a different way. Say current NZ health expenditure was some $10B/year, then over 16 years (in today's prices) that's some $160B. Again for NZ that's an unheard of sum! If the (whatever) Govt said that the Health budget was $160B (even saying it's over 16 years) then every blXXdy man and his dog would be protesting - for example, women would be protesting that they can't get subsidised Herceptin (unlike in Aussie), hip replacement patients would be protesting that they are sick of the waiting lists and want immediate operations, people would want Pharmac to subsidise every drug they require etc etc.
So it's a matter of`perception. If the NZ Govt wanted to buy a third`Frigate now as an example, whatever they cost, say $1B in today's prices, well if you paid it off over only 10 years at $100M per year (plus inflation) - the defence budget needs to increase only $100M per year (plus additional operational and`crewing costs of course, as well as factoring in for inflation etc). Considering the NZ economy is generally in better shape with operating surpluses of several billion dollars per year at present, please don't tell me that NZ can't afford a third Frigate or a 4th Frigate or whatever else deemed important (an expanded Army perhaps)? As AD said recently, it's due to the will of the politicians. As Todjaeger said recently when comparing NZ to Singapore (well maybe not exactly the way I am), should NZ be lifting it's defence GDP expenditure from 1%? Even a "modest" 0.5% increase would provide alot of additional capabilities to support current govt policy (eg no need to get carried away with high-end capabilities etc and yes I'd like to see our overseas debt reduced/paid off).