Transparency of the fighter procurement and operation costs must be ensured

In its plenary session on Friday, 10 December 2021, the Finnish Government decided that Finland will purchase 64 U.S. Lockheed Martin F-35A fighters, as well as related weaponry and other key systems. The National Audit Office of Finland will continue to monitor the Fighter Programme.

Following the decision taken in the HX Fighter Programme, it will be important to ensure the transparency of the costs related to the system’s procurement, maintenance, operation, and future investments. Finland does not currently disclose the operation and maintenance costs of its present Hornet fleet, for example.

The operation and maintenance costs of the HX system have been capped at 10% of the military defence expenditure at the level of 2021, i.e. at slightly over EUR 250 million per year (excluding VAT expenses). From this perspective, it would be good if the operation and maintenance costs of the most expensive system of the Finnish Defence Forces were disclosed more openly. This could be done, for example, by publishing the total annual operation and maintenance costs, as is done in many reference countries.

The Fighter Programme was prepared thoroughly, but it is challenging to estimate its lifecycle costs

The National Audit Office of Finland (NAOF) has assessed the preparation of Finland’s HX Fighter Programme in its audit “Expenses of and funding for the strategic capability projects of the Finnish Defence Forces”, completed in summer 2020.

According to the audit findings, the HX Fighter Programme has been prepared thoroughly. Efforts have also been made to open up the criteria used in the decision-making model. The NAOF has contributed to ensuring the quality of the preparations of the Programme and the reliability of the information provided to the decision-makers.

In the preparation phase, it has been necessary to estimate costs that will be incurred during the system’s entire lifecycle and that will not start to materialize until at the beginning of the 2030s. This is inevitably difficult and involves uncertainty. The Finnish Parliament decided on the funding of the HX procurement when discussing the budget for 2021.

The NAOF will monitor the fighter procurement until the end of 2022

 The National Audit Office launched a follow-up on the audit of the HX Fighter Programme in autumn 2020 and will continue with it until the end of 2022. After this, the NAOF will prepare a final follow-up report. The NAOF will make decisions on any new audits in connection with its annual audit planning.

In 2022, the National Audit Office will monitor the start of the implementation phase, which follows the HX procurement decision. In spring 2022, the follow-up will also address the lessons learned and experiences gained from the HX Fighter Programme decision-making and assessment model, as well as any development needs. The aim is to provide information on the model’s potential for future utilization.