§ Mr. DavidsonTo ask the Secretary of State for Defence what is the expected cost of Eurofighter per unit indicating the variations depending on the numbers ordered; and if he will make a statement.
§ Mr. AitkenOn the basis of our declared offtake of 250 aircraft out of a production run of 602 aircraft, the current estimated unit production cost is £34 million at 1993 prices.
73WThe unit production cost will vary according to the number of aircraft ordered by each of the four partner nations, the work sharing ratio and the contract prices negotiated.
§ Mr. DavidsonTo ask the Secretary of State for Defence what is the cost of Eurofighter's development programme to date; what assessment he has made of the reasons for the cost overruns; and if he will make a statement.
§ Mr. AitkenThe project cost is reviewed annually. As reported in MOD's major projects report 1993 the development cost was estimated at that time at £3,463 million at 1993 prices. That represents an increase of some £570 million since the project was originally approved. Of this, some £450 million is due to German withdrawal from certain equipments, higher than expected equipment costs and the estimated cost of the reorientated development programme. The remainder reflects a reassessment of the estimated development costs between the dates of ministerial approval—April 1988—and the prices negotiated before the start of development—November 1988. The cost increases are unwelcome but not unexpected for a collaborative project of this complexity and technical sophistication. Negotiations are still in progress with industry over the cost of the reorientated development programme. A new estimate reflecting the expected outcome of these negotiations should be available soon.