2.2 Project Expenditure History

Date

Description

Base Date $m

Current $m

Contractor

Notes

2.2 Project Expenditure History

 

 

 

 

 

Phase 1and Phase 2

 

 

 

 

 

Prior to
Jul 10

 

2,162.2

2,138.4

 

US Government

7

 

 

87.6

86.6

 

Phase 1 (Aircraft) US Government

7

 

 

 

 

 

Phase 2 (Weapons)

 

 

 

88.2

87.2

 

Other Phase 1

5

 

 

0.8

0.8

 

Other Phase 2

6

 

 

2,338.8

 

2,313.0

 

 

FY to
Jun 11

 

407.5

346.2

 

US Government
Phase 1 (Aircraft)

7

 

 

17.6

15.4

 

US Government Phase 2
(Weapons)

7

 

 

21.7

18.3

 

Other Phase 1

5

 

 

0.6

0.6

 

Other Phase 2

6

 

 

447.4

 

380.5

 

 

Jun 11

Total Expenditure

2,786.2

 

2,693.5

 

 

 

 

 

 

 

 

 

Jun 11

Remaining Budget

801.5

 

885.0

 

 

 

 

 

 

 

 

 

Notes

1

Guidance transfer to DSG Facilities element.

2

Real Cost Decrease Phase 1 - budget transfer to AIR 5349 Phase 2 ($99.0m) for Super Hornet Weapons.

3

Real Cost Decrease return to Portfolio ($107.2m).

4

Up until July 2010, indexation was applied to project budgets on a periodic basis.    The cumulative impact of this approach for Phase 1 was $351.4m. In addition to this amount, the impact on the project budget as a result of out-turning was a further $15.9m having been applied to the remaining life of the project. The cumulative impact of this approach for Phase 2 was $20.6m. In addition to this amount, the impact on the project budget as a result of out-turning was a further $3.3m having been applied to the remaining life of the project.

5

Other expenditure comprises: operating expenditure, contractors, contingency, other capital expenditure not attributable to the aforementioned contract and minor contract expenditure. For base date calculations against "Other" expenditure, calculations have been made using a proportional adjustment. This proportional adjustment involves the average between base date calculation of the disclosed major contract(s) and their constant price and applying to the "Other" expenditure.

6

'Other' cost is a combination of overseas and domestic travel, Professional Service Providers, Freight and General Administration. For base date calculations against "Other" expenditure, the calculations have been made by de-escalating the compound effect of the

7

For Base Date calculations for FMS cases, a consistent de-escalation factor has been applied to all projects which is derived from Defence's cost estimation methodology.