Costs associated with upgrading and maintaining the Navy’s combat fleet over the next 30 years will tack on an additional $2 billion to the sea service’s $465 billion shipbuilding plan, which could endanger Navy efforts to hit its 328-ship end goal, according to a recent report by the Congressional Budget Office.
According to the report, the $15.5 billion the Navy plans to invest each year for the next three decades in building its fleet of surface warfare ships and submarines only accounts for actual shipbuilding costs.
“However, other activities typically funded from the Navy’s budget accounts for ship construction…will, in CBO’s estimation, add nearly $2 billion to the Navy’s average annual shipbuilding costs under the [current] plan,” the report states.
When taking into account costly, but necessary, expenditures such as refueling nuclear-powered carriers and retrofitting surface ships with critical system upgrades, that per-year total jumps to $17.3 billion over the life of the shipbuilding plan, it adds.
That vector only gets bigger as time goes on, according to CBO analysts. The office’s estimates have pegged total costs for the first 10 years of the plan seven percent higher than service estimates. That increase jumps to 10 percent during the next 10-year block, topping out with a cost estimate 31 percent higher than Navy cost projections in the final 10 years of the plan, according to the report.
Over the 30-year lifespan of the plan itself, CBO estimates the Navy will have to shell out a total of $539 billion. That figure takes into account the required but unaccounted for costs associated with upgrades and maintenance.
The sea service’s longstanding shipbuilding plan has the Navy hitting a base fleet size of 313 ships over the next few years, with that number reaching closer to 328 in 2020, according to acquisition officials. That buildup will likely top out by the 2020 time frame, when at that time acquisition will taper off from that 328-ship high, due to scheduled retirements of legacy ships and the introduction of the SSBN(X) submarine program.
“If the Navy receives the same amount of funding for ship construction in the next 30 years, as it has over the past three decades, it will not be able to afford all of the purchases in the [current] plan,” congressional analysts note, citing the $16 billion annual average the Navy has received for shipbuilding investments.
However, Navy Secretary Ray Mabus has stated the service will need an additional $14 billion in shipbuilding investments per year through 2020 to support that plan. “What we have set forth is an average of $14 billion a year [for] building ships, [and] that is based on history. We can get the ships we need for that amount of money,” Mabus told reporters during an April 15 briefing.
But even with those additional funds, according to the CBO, the Navy will still fall short of its stated shipbuilding goals. “Given the rate at which the Navy plans to retire ships from the fleet, [its] construction plan is insufficient to achieve a 328-ship fleet,” the report states.