Defence spending plans of major European nations

France

France 's defense ministry plans to slash spending by 3.5 billion euros between 2011 and 2013 to contribute to government efforts to rein in the public deficit. The cuts equate to less than approximately 4% of the defence budget.

The defense budget was provisionally pegged at 95 billion euros for the period from 2011 to 2013 but with the spending cuts, the figure would now be around 91.6 billion euros.

The figures published in the 2009-14 military budget law were 29.65 billion for 2011, 30.32 billion for 2012, and 30.73 billion for 2013.

The revised defense budget for 2011 will be 30.15 billion euros, 30.5 billion in 2012 and 31 billion in 2013, Morin told the committee.

The government plans to postpone a number of French Air Force programs, including replacement of the inflight refueling fleet and the 700 million euro ($888 million) upgrade of Mirage 2000D aircraft. Among the programs to be delayed are the acquisition of the Multi Role Tanker Transport (MRTT) aircraft and level four of the SCCOA national air command-and-control system. Some elements of the Scorpion land systems modernisation programme will also be postponed.

Cuts would not affect production and delivery of weaponry, planes, ships or nuclear submarines. Major programmes - such as the Barracuda nuclear attack submarine, Felin infantry gear, FREMM multi-mission frigate, Rafale fighter and VBCI armored vehicle - would escape the budget cuts.

An option to buy a small number of Falcon 2000 jets to replace the Falcon 700 for the government comes due in the next few months and is under consideration. The purchase of A400M airlifters will go ahead without any change in numbers despite German reluctance to follow suit.

Germany

Germany might retire large numbers of planes, helicopters and ships and reduce buys of new weapons. This would reportedly save 9.3 billion euros.

The 23-page paper, "Prioritization Material Investments - Recommended Actions," would affect all services and many major defense projects. (Currently only an advisory paper, with defence secretary to have the ultimate decision).

The paper itself suggests retiring 15 of 86 Transall transport planes immediately and reducing the planned purchase of its successor, the A400M. The paper also calls for the immediate retirement of 100 of 185 Tornado fighter jets and the scrapping of the last tranche of the Eurofighter, which contains 37 planes.

Defense Department experts also suggest scrapping the Tailaron UAV being developed by EADS in favor of immediate procurement of the Saateg AA medium-altitude, long-endurance UAV and an advanced version of the Heron UAV.

While the future of the tri-nation Medium Extended Air Defense System had been subject to discussion, the new paper does not suggest it be abandoned.

According to media reports, the Bundeswehr might also buy only 80 instead of 122 NH90 type helicopters and cut new tiger attack helicopter buys by half from 80 to 40.

The paper recommends the German Navy retire eight frigates, 10 fast-attack boats and 21 Sea King helicopters over the medium and long term. At the moment, it owns 21 Sea Kings, 10 fast-attack boats and 15 frigates. The number of new F125 expeditionary class frigates also could be reduced from four to three.

Italy

Italian media reported May 31 that the Defense Ministry could have 255 million euros stripped from its funding in 2011, while in 2012 it would lose 304.8 million and in 2013, 104.8 million euros.

The reports added that for Italy’s Industry Ministry, which tops defense procurement spending, the cuts would be tougher, running to 2.6 billion euros over the three years. Such cuts form part of austerity measures that aim to reduce government spending by 23 billion euros.

With cash for procurement already low and the fixed military wage bill costing 9.3 billion euros out of a total spending of 14.3 billion euros, the maintenance and operations bill, which includes training, has been the main victim of cuts since 2001.

Most recently, it has been trimmed by a three-year program of reductions spanning 2009-2011 to which the new 10 percent cut will be added.

Rationalisation of defence spending has impacted upon the Italian Air Force (IAF) since 1999. Since then nine air bases and three combat bases have been scrapped. According to the Military Balance, Italy also plans to reduce the number of IAF aircraft from 390 to 310.

Eurofighter are offering 24 Tranche 1 Typhoons that have been in service with the Italian air force since 2003 and a promise to create 5,000 new jobs. Upon making the offer Eurofighter also indicated that the aircraft had flown less than 10% of their expected flying hours. As it is expecting the first delivery of F-35Bs in 2014, the sale of the Typhoons suggests that Italy is both making space and cutting operational costs.

Spain

Despite a four per cent cut to USD15.88 billion in 2009, Spain's defence budget is still the fifth highest in Europe. However this year Spanish defence spending has declined by 9% to approximately $14 billion.

Since gaining power in 2004 Zapatero has increased the MoD's budget by EUR1.4 billion, a little over 20 per cent in nominal terms.In general terms the low proportion of national wealth apportioned to defence is indicative of the low priority defence spending has had in Spain in recent years.

The defence budget for 201o  has two major priorities: To assure the safety of personnel, with stronger investments in operating expenses and logistical support; To guarantee the operational availability of the armed forces for fulfilling assigned missions, particularly those arising from Spain's international commitments through the EU and NATO, at the required level. Alongside these priorities, the budget ensures the continuity of policies to professionalise the armed forces and to modernise armament, equipment and infrastructure.

Major contract wins: European contractors

Thales

Thales will begin deliveries in August of the first production batch of active electronically scanned array (AESA) radars for the fourth tranche of Rafale strike fighters.

The delivery of AESA production units marks the culmination of some 12 years' work and more than one billion euros ($1.3 billion) of government and industry investment.

The AESA radars will equip the fourth tranche of 60 Rafales ordered by the Direction Générale pour l'Armement (DGA) procurement office at the end of 2009.

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Thales has signed a contract for an undisclosed amount to supply radar, infrared search and track, sonar and communications systems for three FREMM multimission frigates for the French Navy, a spokeswoman for the systems company said.

The unit price of the FREMM warship, based on an initial 17-strong purchase for the French Navy, was 388.5 million euros ($526 million), totaling 8.51 billion euros, official figures show. France slashed the order to 11 frigates.

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Thales has signed a fixed-price, 10-year contract with Dassault Aviation to supply maintenance services for electronics equipment onboard the Rafale strike fighter, the systems company said Feb. 2.

The contract includes "maintenance support for avionics equipment on Rafale combat aircraft in service with the French armed forces," Thales said in a statement. No financial details were available.

French defense companies are increasingly looking to services as a way of boosting revenues. Land systems company Nexter on Nov. 19 signed a 10-year contract, worth an annual 90 million euros ($126 million), for maintenance support of the French Army's 254 Leclerc heavy tanks.

Industry faces tight defense budgets limiting purchases of new equipment, while the armed forces seek to reduce the cost of maintenance, even as they brace for staff cuts as part of reductions in public-sector employment in the coming years.

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