N.Z. frigate benefit $2B —consortium

Press, 3 June 1989, Page 9

N.Z. frigate benefit $2B —consortium

By

DAVE WILSON

One of the competing consortiums in the Anzac frigates project yesterday predicted New Zealand could benefit by $2 billion if it bought four ships.

Cable Price Downer, the New Zealand partners in the consortium promoting the German Meko ship design, said that on top of the $1 billion of New Zealand industry work built into the construction programme, at least the same amount again would be spent in New Zealand in the next 30 years. This would be spent on maintenance and refits of ships during their estimated 30-year service life. But top officials of Amecon, C.P.D.’s Australian partner which is bidding for the ships project, said the level of New Zealand industry involvement guaranteed by the consortium was based on New Zealand buying four ships. The proportion of New Zealand industry work on the project would be scaled down proportionately if New Zealand only leased two ships and took options on two others — a move hinted at by the Government this week.

project manager, Mr Tony Shepherd — endorsed C.P.D.’s claims.

Both Amecon and its rival, Australian Warship Systems, are refining their tender prices in readiness to quoting final prices on June 16. Dr White and Mr Shepherd confirmed the consortium was trying to ensure its “best and final offer” price would be within the price ceilings set by the Australian and New Zealand Governments.

New Zealand has been guaranteed its ships at $3OO million apiece in April, 1986, dollar values while Australia’s price ceiling is set about $330 million, in April, 1988, values. Mr Shepherd said it was proving difficult to keep the final tender price under the ceiling, but denied news media reports this week that the two consortiums had tried to, force up the ceiling price.

Cable Price Downer and Amecon put their case at a news media briefing in Wellington, but the venue, C.P.D.’s headquarters, was itself targeted by antifrigate protesters who used the event to launch a new phase in their campaign.

"This consortium has made no such approach to either Government,” he said.

Dr White said the consortium was under great pressure to meet the budgeting constraints of the two Governments. “But we are shaving off costs to get the final price down. That’s one of the reasons we are in New Zealand. We are putting pressure on all our sub-contrac-tors, here and in Australia to keep the prices down.”

Protesters picketed the building, and Amecon executives became the focus of what the protesters said was the start of a direct campaign against the frigate consortiums.

Nine floors above them, Cable Price Downer’s managing director, Mr Rick Christie, dismissed the protest, instead expressing his frustration at the lack of recognition being given to the opportunities for New Zealand industry in the project.

More than 300 New Zealand manufacturing and engineering companies initially expressed interest in being part of the Amecon bid. Mr Christie said this list had been whittled down to 100 companies that were serious about pursuing the project and were prepared to invest money in new plant. He expected more than 50 companies would ultimately take part in the project. Mr Shepherd said if New Zealand only leased two frigaates, the proportion of New Zealand work would decrease, but if New Zealand later took up its options on two more ships, the New Zealand industry participation would be restored to the levels now promised.

He reiterated the company’s stance, that the Anzac project represented the beginning of a New Zealand defence manufacturing industry. That line was supported by the Victorian deputy premier, Mrs Joan Kirner, who is also the member of Parliament for Williamstown, Melbourne, home of the Amecon consortium.

Amecon’s top executives — managing director, Dr John White, and the Anzac