December 1, 1999 (by Lieven Dewitte) - New Zealand's emerging Labour-led government said on Thursday it would seek to cancel a deal struck by the previous administration to lease U.S. F-16 strike aircraft, provided the termination cost was not too high.
The previous government, defeated at elections on Saturday, agreed in July to lease 28 older model F-16 A/B jet aircraft to replace the country's 19 aging, subsonic Skyhawk A-4 attack aircraft. Prime Minister-elect Helen Clark told reporters the new government would adhere to its policy of focusing military spending on the army, in line with a recent parliamentary study. She declined to comment when asked what the cost cut-off point would be for scrapping the deal.
The planes were to be taken from U.S. military stocks and updated by Lockheed Martin. The package also included 28 engines built by the Pratt and Whitney division of United Technologies Corp.
The Royal New Zealand Air Force's McDonnell Douglas Skyhawks, some dating back to 1965 and others to 1970, were scheduled by the Ministry of Defense to be dropped in 2007.
Officials estimated the minimum capital cost of the F-16 aircraft deal at NZ$700 million.