France's defence budget has been restored to the level called for in the 1997-2002 spending plan, raising hopes that the long-awaited multi-year procurement funding for Dassault Aviation's Rafale fighter will finally be released.
The extra money - around Fr4 billion ($660 million) - has come from unspent equipment funds from previous years, which until now have remained frozen. In an unexpected move, the Government has authorised the Ministry of Defence to bring the 1999 defence equipment budget to the original Fr85 billion level, up from the Fr81 billion to which it was reduced earlier this year.
Defence sources say that the extra Fr4 billion is close to the amount needed to proceed with multi-year funding for the Rafale, since the first year's production of 12 aircraft would cost about Fr3.6 billion. They add, however, that the Government could only go ahead with the full 48 aircraft programme if four years of production was assured, this being the basis on which industry has set its costings.
In June, senior officials at the French defence ministry took over multi-year procurement pricing negotiations with Dassault Aviation after talks with the weapons procurement division broke down. The pricing issue is understood to have been resolved, which removes another barrier to the programme.
Source: Flight International
