Australia cancels submarine rescue system contract

The Australian government and the Australia subsidiary of US-based underwater technology firm Phoenix International have both agreed to terminate an existing contract for the delivery of a new deployable rescue system optimised for use with the Royal Australian Navy’s (RAN) Collins-class and Attack-class submarines.

In April 2018, following an open tender process, Phoenix International Australia was selected to deliver a deployable submarine rescue system for use with both the Collins and Attack class submarine fleets.

Following a series of delays in 2019 and 2020, the Australian Department of Defence (DOD) initiated an independent review of the project in August 2020.

The government has considered the outcomes and recommendations of the review and has agreed to terminate the contract with Phoenix International Australia by mutual agreement.

The government has directed the DOD and the Department of the Prime Minister and Cabinet to conduct a comprehensive investigation to inform lessons learnt into procurement practices and relevant accountabilities.

The DOD confirmed that the investigation is underway. It will now work with Phoenix to reach settlement, which will include addressing arrangements with Phoenix and its subcontractors.

The RAN retains a suitable submarine rescue system supporting the Collins-class submarines under an existing contract with James Fisher Defence Australia.

The DOD claims this system can be sustained into the late 2020s, affording the government time to consider the acquisition of a replacement system that will be required to support the larger crew size of the Attack-class vessels.