§ Mr. CousinsTo ask the Secretary of State for Transport, Local Government and the Regions what funds have been committed to the Galileo satellite navigation system; and what estimate he has made of the total final cost of the system to(a) public and (b) private funds. [37292]
§ Mr. JamiesonThe Galileo satellite navigation programme is being carried out jointly by the European Union (EU) and the European Space Agency (ESA). They are each planning to contribute euro 550 million to the development and validation phase (2001–05). In April 2001 the Transport Council released euro 100 million of the EU contribution. A decision on whether to release the remaining euro 450 million may be taken at the Transport Council on 26 March. A declaration for subscriptions to ESA's share of the costs was opened at the ESA ministerial meeting held in November 2001. A majority of ESA member states subscribed but the UK indicated that it would await the outcome of the Transport Council's decision before finalising its contribution.
Originally, the European Commission estimated that the capital costs of Galileo would be euro 3.25 billion (2001–08) with annual operational costs of euro 220 million from 2008. The public sector would provide euro 1.75 billion of the capital costs, the private sector the balance of euro 1.5 billion, and operational costs would be met from revenues.
A recent study carried out by PricewaterhouseCoopers (PWC) on behalf of the Commission has put the capital cost at euro 3.4 billion, with annual operating costs of euro 224 million over a 20-year concession period. PWC considered that the programme would require some continued public funding for deployment of the system and payments during operation. Total public sector funding was estimated at some euro 3.8 billion, depending on the private sector assessment of revenues and risks, and subject to the outcome of a competitive tendering process.