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Australia pays French contractor $835m for derelict submarine contract

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The Australian government has agreed to pay French submarine contractor Naval Group $835 million for the controversial cancellation of the contract to build 12 submarines.

Prime Minister Anthony Albanian announced the settlement on Saturday, making it clear that the former Morrison government’s handling of the cancellation of the $90 billion deal “has caused enormous strain in relations between Australia and France”.

“It is a just and fair settlement that has been reached. This also follows on from discussions I had with the President [Emmanuel] Macron and I thank him for these discussions and the cordial way in which we are restoring a better relationship between Australia and France,” he said.

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The deal with France was scrapped in September last year, instead of Australia entering the AUKUS security alliance with the US and UK. Under the new deal, Australia will acquire at least eight nuclear-powered submarines and gain access to cutting-edge technology.

Hoping to bridge the gap between Australia and France, Albanese said he was “eager to respond to President Macron’s invitation to come to Paris as soon as possible.”

“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 a relationship based on integrity and respect. mutual”, he said.

Albanese said the total amount spent by Australian taxpayers on the abandoned French submarine deal is now $3.4 billion, a saving from the $5.5 billion that the Senate estimates , would result from the program.

“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.’

– Albanian PM

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