Maritime Forces Review

Implications

With an increase in fleet size, each of the options will provide challenges for managing personnel issues. Issues that need to be considered are recruitment, training, retention, maintaining adequate sea/shore ratios and the adoption of multi-crewing concepts to generate more sea-days for the patrol vessels. It is envisaged that retention would be improved by demonstrating a national commitment to a practical navy, providing more variety, reducing training bottlenecks and giving younger officers and senior ratings earlier opportunities to take up command and management positions.
The fleet composition option is based on a multi-crew concept in order to generate 200-220 sea days a year from new vessels. This assumes that the RNZN has, or can develop, a capacity to recruit, train and retain additional personnel. The RNZN's ability to achieve this will be examined in more detail in the next phase of the review when actual vessels are selected.

The introduction of additional vessels will raise logistic support issues. These include planned and unprogrammed maintenance requirements, the support strategy adopted, and the types of systems and equipment installed. Ensuring that new vessels have as much equipment commonality as possible with existing vessels could significantly mitigate the risks associated with these issues. A mix of OPVs and IPVs would present greater support issues than introduction of a single type of patrol vessel.

Financial issues include the impact of acquisition and operating costs on the NZDF, and the total capital acquisition budget available against all other defence capital requirements for expenditure on naval acquisitions.
The NZDF’s draft Long Term Development Plan (LTDP) has included provisions of $500 million for capital acquisition to meet this requirement. The operating costs must be affordable within the NZDF baseline. The proposal for acquisition must be a ‘design to cost’ approach to fit within these parameters.
The NZDF operating baselines have been set until FY 05/06 which coincides with the planned retirement of Canterbury. The fleet structure proposed by this Review will have no impact on baselines until after that time. Subsequently, it is expected that it may be possible to meet the direct operating and personnel costs of the new vessels from within current funding once Canterbury is taken out of service. The introduction into service of $500 million of new capital equipment, however, has the potential to increase depreciation expenses by about $10 million annually. The NZDF is unlikely to be able to manage this within current baselines.