Wednesday, January 17, 2001 - 7:45 a.m. EST
(Signing of U.S./U.K. Memorandum of Understanding on the Joint Strike Fighter with Baroness Symons of Vernham Dean, Minister of State for Defence Procurement)
De Leon: Good morning, everyone. Baroness Symons, welcome to you and the members of your delegation for this most important milestone in the special relationship that long has existed between our two nations.
Dr. Jack Gansler, our acquisition czar emeritus. (Laughter) We only have one position in the U.S. government that comes with the title czar -- our acquisition czar emeritus, who left the department just last Friday [clarification: Jan. 5, 2001], but also left us, among many of his other achievements, this milestone in the Joint Strike Fighter [JSF] program.
In very great measure, this signing is his success, part of his legacy, and the ceremony would not be complete without his presence. So Jack, thank you for being here today.
Principal Deputy Under Secretary Dave Oliver; our policy team leader, Under Secretary Walt Slocombe -- Walt, thank you; Principal Deputy Under Secretary Jim Bodner -- Jim; and Acting Assistant Secretary Sukin representing our State Department colleagues; General Mike Hough, the JSF program manager and his negotiating team; distinguished guests, including our leaders from industry; ladies and gentlemen.
Achievement of this great team represents the flexibility and foresight that will characterize the Joint Strike Fighter. The aircraft program poised to meet the strategic environment of the future, the Joint Strike Fighter program, the largest defense procurement program ever conceived, represents our joint vision of a mutual security. An environment that will foster coalition engagements and it represents our joint requirement that the United States, the United Kingdom and our allies not only be able to fight together, but work together to develop weapons systems and equipment that are fully interoperable, more effective than ever before in dominating the field of battle that will, I think, that will symbolize our partnership, and that indeed several other coalition partners may soon enter into agreements today.
This signing represents a further commitment on the part of the United States to effect a fundamental change in the way we cooperate -- equally important to the future of both the British defense industry and the American defense industrial base. By improving and enhancing our export control process, our disclosure process and security requirements, and by promoting projects like the Joint Strike Fighter, we will provide significant benefits for the defense industries of both the United States and the United Kingdom.
Our goal is to maintain a strong transatlantic industrial base, enhanced interoperability within the NATO alliance, ensure access to the best American and European technology to meet common requirements, and greater access to the American and European markets that will help build economic strength on both sides of the Atlantic.
Easing restraints creates greater sharing of technology, more jobs, more competition, more innovation, and greater private industry involvement. The bottom line: we forge relationships that solidify and strengthen our military and political alliance.
We also realize, however, that increased cooperation in developing systems such as the JSF increases potential security risk with regard to military technology. It requires governments and firms to agree to tighter external controls and to embrace a new security environment.
Both of our nations can benefit by increased cooperation in developing these systems. But more importantly, our strong alliance will more effectively ensure our mutual security in a dangerous and unpredictable world.
The signing today recalls the fervent desire of Winston Churchill that the United States and the United Kingdom themselves remain united in their mutual commitment to freedom.
At the dawn of another rapidly changing era, he called us to a fraternal association, free and voluntary. "I have no doubt," he said, "it will come to pass as surely as the sun will rise tomorrow."
Today we once again fulfill his optimism for our two nations and find as constant as the sun our partnerships in the closest of free and voluntary fraternal associations.
Thank you very much.
Symons: Thank you.
May I thank you, Rudy, for your very warm welcome and the support given to the U.K./U.S. relationship in your opening words, and may I also add my enthusiastic congratulations to the whole team that has made this possible. I've come to know some of you over the last 18 months or so, and I must say I've been very impressed by the extraordinary degree of knowledge and the commitment that the team has shown -- teams from both sides of the Atlantic -- in bringing us to this point today.
If I may say so, it's also extremely nice to see some of my colleagues from the United Kingdom, United Kingdom industry here today. It's great to see that, and thank you for coming to support us in doing this.
Because, of course, the United Kingdom also sees the signature of the MOU for the engineering manufacturing development phase of the JSF program as a very important step forward in the relationship between our two countries.
I'm sure most of you know that the United Kingdom has been working with the United States on the JSF program as a full collaborative partner since 1996, and we've said publicly for some time now that the JSF was a strong contender to meet the United Kingdom's requirement to replace our Royal Navy and Royal Air Force Harrier aircraft which are now working together as the joint force Harrier organization.
Our commitment today to the JSF program shows that we continue to consider the JSF supersonic aircraft with all its stealth technology, its multi-role capability, as the most cost effective means to meet our requirements. It will be, we believe, the best aircraft of its type in the world. And I'm pleased that British industry as well as the British government are committed to working through our United States counterparts to fulfill that end.
But of course we recognize that a number of key decisions remain to be taken about the JSF program. Signature of the MOU today allows the United Kingdom to take part in the selection of the prime contractor for the next phase. We also recognize, of course, that the incoming administration will wish to look at the program in parallel with many other United States programs, and we look forward to continuing the constructive dialogue that we have on a broad range of military issues.
I think history has shown that administrations have changed in both our countries, and that our relationship has continued to grow. It's continued to grow in the breadth of our cooperation and in the depth of our commitment, and nobody knows that better than our armed forces where, as Rudy de Leon has said, through NATO, the transatlantic relationship has grown and continues to grow. And I've been hugely impressed in the way that our armed forces work together not only on projects such as this, the forward planning projects, but of course as well at an operational level, and the confidence that they have in each other.
Participation in the JSF program has been and continues to be a tremendous opportunity for United Kingdom and United States industry and I'm very pleased, as I've said, to see so many representatives from the United Kingdom, key companies involved here today.
The cooperation between the United Kingdom and U.S. companies is not only welcome, it is of course in breaking new ground in this memorandum that we have signed. The U.K. and U.S. governments have taken steps to ensure that those relationships go on to greater strengths. Last year as many of you well know, the Secretary of State for Defence, Jeff Hoon, the Secretary for Defense, Bill Cohen, signed the Declaration of Principles for defense equipment and industrial equipment which sets out our view of successful cooperation for joint programs -- a very important commitment that was.
The JSF and the Defense Secretaries have decreed a set of principles that provide a framework for our involvement in the program in the longer term, safeguarding the nation's national interests and ensuring that military and industrial capabilities of the aircraft are properly managed and are maintained throughout the lifetime of the aircraft.
As I said, we believe, as Mr. de Leon said, that the program is very good for NATO and our transatlantic ties. I believe that it's also very good for the European defense capabilities and a number, as many of you well know, of our European partners have been keeping a very close eye on our progress in this respect.
But fundamentally, of course, it is wonderful for the capability of our armed forces.
So the United Kingdom is very pleased, indeed we are delighted to confirm our strong commitment to the JSF program. We welcome the closer links that it signifies between the United States and the United Kingdom industry, and we look forward to working with the new administration as we have enjoyed our very close working relationships with this administration, not only on JSF but of course on a number of programs across the board.
Thank you very much.
Staff: Ladies and gentlemen, the Baroness and Secretary de Leon do have a few minutes to take a couple of your questions. Please address your questions to the topic of the ceremony, the Joint Strike Fighter.
Q: Is the United Kingdom by signing this MOU saying that the Joint Strike Fighter will be the solution to its search for a future carrier-borne aircraft?
Symons: We are saying that at the moment we think it has the best potential. We haven't signed a contract, a final contract. It's obviously the United States with an incoming administration is going to have to consider its own position on JSF. As you know, there is a competition in progress as well.
But what we are saying is that we are committing ourselves to the next crucial phase, the EMD phase, and that we have believed now for some time that it was a very strong contender. And I think that what we have done here today is confirm that belief in writing and to say that we do believe that the potential is there for this being the aircraft that we will eventually choose.
Q: Baroness, can you flesh out the size and scope of your commitment in the $2 billion U.S. range, and when actually would you put the dollars on contract? Is it contingent on a full-scale development contract being signed in the U.S.?
Symons: We are talking here about, I think it's two billion pounds sterling rather than two billion... It means a little bit more money than...
Voice: Two billion dollars.
Symons: Two billion dollars. I beg your pardon, I thought it was two building bar sterling, it's always a confusing moment.
But of that, 1.3 billion is -- I'm looking now because... Where are my people? Steven, tell me if I'm getting this completely right, but as far as I know we're talking about 1.36 billion to the program and another 600 million in terms of the sort of modifications we'd have to make in the United Kingdom. So I think that 1.3 equals your two billion dollars, and the extra 600 million which is... So I was right in talking about the total commitment that we are putting in, for us it is two billion pounds. But the commitment to the joint program is 1.3 billion pounds, i.e. two billion dollars.
Is that clear?
Symons: Okay, let me do this again.
We've got two lots of two billion here. The one you're interested in are the two billion dollars to the joint program. In addition, we in the United Kingdom have to produce more money because we are looking at ways in which, because we're talking about our aircraft carriers and modifications that might have to be made. So we actually in terms of our own commitments from our own treasury, need another 600 million pounds, which goes back to my two billion pounds in total, in terms of the commitment from the United Kingdom treasury.
So it's 1.3 billion pounds, it's two billion dollars. But taken all together for us, it's two billion pounds.
I have really got that right, this time. It's a great deal of money.
Q: Which is...
Symons: Of course it's not nearly as much money as if we do in the end go ahead with the entire projects, which taking is up to the year 2040 will mean that in current prices we'll be talking nearer ten billion pounds sterling overall.
So the United Kingdom does I think have to have a good deal of confidence, a good deal of commitment to have committed ourselves in this way. Now you say, well when do you actually start spending it? Well, of course to some extent we've been involved already. We've been involved, as we said, since 1996, so a certain amount of money's been spent already. But the actual money starts to get spent in a serious way from about autumn of this year.
Q: Thank you.
Q: How exactly will you take part in the choice of the prime contractor? What weight will Britain's say have in the decision?
Symons: Well, I think that may be one for Mr. de Leon. (Laughter) We would like to think a very great deal indeed, but of course we are full collaborative partners, but of course the lion's share of the budget lies with the United States, although I think the United States is being very fair to us in the way that we've conducted business so far. But Rudy, perhaps...
De Leon: I have no doubt that the source selection board will, as a precept, find a way to have appropriate linkage with -- we're going to doing it between the Air Force, Marine Corps and Navy to boot. So our collaboration with our allies I think will be easy compared to the more complicated collaboration in the Pentagon.
Q: Will there -- do you have in mind some kind of a proportional say, proportional to the amount of Britain's investment in the program as a part of the whole?
De Leon: I wouldn't say that it will be a formulaic approach where it will be percentages. I think we'll find a way to make sure that input is secured and that the data in terms of the source selection authorities, that the data flows into the source selection authorities in terms of the interests of all of our parties.
Q: What is the correct portion, then, of Britain's investment in terms of the whole? Compared with the U.S. investment?
De Leon: We'll run some numbers and give you that for the record. This is our largest procurement. I think we're looking at the...
Q: Do you think about eight percent?
De Leon: Is that FSD [Full Scale Development] or EMD?
Q: One last thing...
De Leon: But just on that, eight percent at the EMD period. As this program unfolds, depending upon the number of aircraft to be procured, the rate of participation among the United Kingdom and other allies who may choose to be participants in the program may obviously be considerably larger.
Q: Okay, fine.
The other thing was, we noticed that one of the MOU findings that you signed was marked secret. Is there a secret annex to your agreement then? What did that cover?
Symons: It will cover -- I'm sorry we don't know each other because I can see that if we did we would have an awful lot to talk about. (Laughter) But it will cover the sort of security issues that you guys always want us to talk about and that we don't talk about. Okay?
Q: It's a long time between now and when the airplane goes into service. In the contract which you'll sign with the U.S. government on EMD, will there be any provision in there for the U.K. to get its money back in the event that sometime between now and 2008, 2010 this program is scrapped or doesn't come to fruition?
And secondly, the 600 million pounds you're talking about spending over and above EMD, could you elaborate on what that's being spent on, please?
Symons: Well, let's deal with the first one. It's not recoverable costs, but there are clauses that cover either side which would wish to back away from what we've been doing. That's pretty standard. It isn't that one would say please give us all our money back, but there would be provision for covering the position of a party that wished to continue with the program in those circumstances. We can give you, I think we're publishing the details so we'll be able to show you the exact way in which that is covered.
I'm sorry. Your second point was?
Q: You talked about the 600 million pounds being spent over and above what's being spent in the EMD phase, and that money's being spent in the U.K. I --
Symons: That would be to cover -- there are sorts of ways in which we will want to integrate the JSF into the United Kingdom's armed forces. It's not just a question, is it, of buying a new capability. There's a question of then integrating the way in which it will operate. That is the sort of contingency money that would be necessary and for us to budget for, saying answering the question that your colleague asked earlier.
What I was trying to indicate was the scale of the commitment that we are entering into, and that is money that we have also had to say to the treasury that we believe that we will need in the Ministry of Defence in order to do this properly, and it's to cover those sorts of exigencies.
De Leon: Let me just add, this program as a measure, one only need to go to Edwards Air Force Base to see the reality of the Joint Strike Fighter program today. There are three hangars, three contiguous hangars, and in there you'll find the heart of aviation modernization for the future. Because the F-22 is in one undergoing its flight testing. Then the Lockheed and Boeing teams in their respective hangars working vigorously on the aircraft, moving toward the DemEval [demonstration and evaluation] phase and a vigorous flying of the prototypes.
So there is hardware on the ramp, and I think that is real, that is measurable, and I think it reflects the commitment that this administration, Secretary Cohen in particular, having a viable program to turn over to a successor, but it's something that you can measure out there on the ramp at Edwards Air Force Base.
Q: Why did you feel that it was necessary to make this commitment now? Why not wait until after the new administration makes its review of the programs of the Pentagon? Wouldn't that have made more sense?
Symons: The reason was that the down-selection starts next month, and I think it's perfectly reasonable, the United States government was very clear, that if we were to take part in that down-selection they wanted us to commit in the way that we have today. And we understood that and we've been very happy to do it. So that's the reason for doing it.
Q: Secretary de Leon, one final on the joint, on the flyer itself. There's been a cottage industry of speculation in Washington here that once the Clinton administration leaves town, the Air Force and the Navy will try to cut this program out of their respective budgets and kill it.
As you leave office can you give us a reality check on the strength that you see various services have had to the program. Will that support last when you leave here?
De Leon: I think one, the administration is leaving a vigorous Joint Strike Fighter program to its successor. They have every right to examine this program and every other element of the Department of Defense budget.
But the critical point is that for our Air Force and Navy and Marine Corps to continue the air superiority that we have enjoyed, they are going to have to field a new aircraft. We are really in the binds of a dilemma -- either moving forward with vigorous modernization of which the JSF has the greatest promise to be the affordable fighter of the future to supplement the F-22 in particular, that we move forward on that. Otherwise we will need to continue to put more dollars into O&M to keep our existing inventory of aircraft up and flying.
The critical piece is the Joint Strike Fighter, allows us to modernize the force structure.
The F-22 gives us a unique capability at the high end. It will dominate the skies. But what the Joint Strike Fighter promises is the ability to modernize our entire force structure, which I think is critical to the projection of U.S. power around the world. So I think...
Q: What about just buying more F-16s...
De Leon: I'm not finished.
De Leon: So I think we're leaving our successor a healthy program. I think they will have a range of options. But indeed, the critical issue is to modernize your warfighting force structure in terms of tactical aviation.
Now hypothetically you could buy upgraded variants of existing aircraft and that may give you some utility in the short term, and even in a longer term, but the JSF is really an investment to continue to what we have taken for granted, which is the ability that we will be able to dominate the sky under all scenarios against upgraded air defenses for the future.
It's got to be affordable, it's got to be maintainable, and it's got to be effective. I think that's why the program that is at Edwards Air Force Base right now, it will involve some very vigorous testing.
But I think we have two excellent prototypes out there flying. We are all going to be tracking with interest the demonstration of the aircraft in all three variants. But I think we leave the next administration a vigorous Joint Strike Fighter program and we are on the path to the modernization of our tactical aircraft that is going to be critical if we are going to continue to have the air superiority that we have taken for granted these last decades.
Symons: Thank you very much.