Top brass take big blowout blame

The Ministry of Defence has taken full responsibility for a $148 million budget blowout for an upgrade of the Anzac frigates.

Defence Minister Ron Mark revealed the major defence project had over-run costs by 30 per cent in question time on Wednesday, which has led to Cabinet having to agree to a revised contract with Lockheed Martin Canada - the supplier of the upgrade.

Mark told Parliament the project had blown out to $639m after being budgeted at $491m in 2014 under the former government and then-minister Gerry Brownlee.

But at a foreign affairs select committee yesterday, Secretary of Defence Helene Quilter said the ministry ‘‘did not meet the standard’’ and had failed in its responsibilities to cost the project appropriately.

She accepted the ministry had got the cost estimates wrong in the early stages of the process.

On Wednesday, Mark blamed the blowout on a ‘‘series of inaccurate estimates and project management errors’’ by the ministry and a failure by previous National ministers to act quickly enough.

He also said the lives of men and women had been ‘‘compromised’’ because of the slow pace in which the project had been dealt with by the former government.

Yesterday, foreign affairs select committee member and minister Willie Jackson asked Quilter to confirm if ‘‘lives had been compromised’’.

She said the 18-month delay had been ‘‘unacceptable’’ but the frigates were still functioning.

The Cabinet sign-off for the extra money also meant the upgrade was now under way.

Defence Force chief Lieutenant General Tim Keating was also at the select committee where he briefed members on the extent of work being carried out both internationally

The Ministry of Defence "did not meet the standard" expected.

Secretary of Defence Helene Quilter

and domestically by defence personnel.

One area where he said improvements could be made was in some of the infrastructure used by NZDF, in particular some barracks that had been built during the war period.

He said there was an opportunity to team up with other social agencies, and groups like the police, to use taxpayers’ money for infrastructure that could be accessed and used by multiple organisations.

Keating also briefed MPs on a potential partnership with the Singaporean Defence Force, which is looking for airspace - most likely at Ohakea - to do an increased amount of training as it looks to expand.

A social, economic and environmental impact report is being conducted on what that partnership might look like but Keating stressed that Singapore was a ‘‘close trusted friend’’ and the deal could have huge opportunities for New Zealand.

Committee member and former trade minister Todd McClay queried whether any failure to meet obligations within trade agreements between Singapore and New Zealand could put the defence force opportunity at risk.

Both Keating and Quilter were reluctant to speculate on such a political issue.

McClay has previously raised concerns about the Government’s new rules around foreign buyers and what that might mean for the current trade deal between New Zealand and Singapore.