December 13, 1999 (by Lieven Dewitte) - New Zealand Prime Minister Helen Clark said on Tuesday she had ordered a defense policy review that would look closely at scrapping a US$343 million deal to lease F-16 strike jets from the United States.
Clark said earlier her government would focus its defense spending on the army, and apparently its involvement in the multinational force in East Timor had exposed deficiencies in New Zealand
's defense capabilities, particularly air transport.
One possible alternative would be to upgrade New Zealand's five C-130 Hercules transport aircraft. Clark said the government had been advised there would be no penalty payments for pulling out of deal provided six months' notice was given.
She said after the November 27 election that U.S. President Bill Clinton had asked her to delay a decision on the F-16 deal until after the arrival of the new U.S. ambassador to New Zealand, former senator Carol Moseley-Braun. Moseley-Braun was due to take up her new post on Wednesday.
Clark said defense and the F-16 deal had been discussed at her government's first cabinet meeting on Monday. She said she expected the policy review to be completed in two stages, with the first stage to examine whether to go ahead with the deal to lease the older model F-16 A/B jets to replace New Zealand's aging, subsonic Skyhawk A-4 aircraft.
Clark to have completed the F-16 review by March.