Budgets cut gives green light to Kidds deal with US navy

The Legislative Yuan has freed the navy's budget for the purchase of four Kidd-class destroyers from the US after the navy agreed to cut the budget by 15 percent to meet opposition lawmakers' demands, the navy said yesterday.

The 15 percent cut has decreased the budget for the Kidds from NT$28.4 billion to NT$24.3 billion. The reduction of cost will be reflected mainly in the number of Standard SM-II air defense missiles to be bought together with the Kidds.

A naval official said the navy has yet to figure out how many SM-IIs could be cut from the purchase order but that training and logistics expenditures to be involved in the deal will be the first to be cut.

The budget for the Kidds is to be spent in a course of four years, starting from this year. According to a finalized budgeting report that the navy has made on the vessels deal, this year's budget for the Kidds has been reduced by 10 percent from NT$4.4 billion to NT$3.9 billion.

The next three years' spendings for the deal are also to be cut to make a 15 percent decrease.

The navy has managed to meet opposition lawmakers' demand for a 15 percent cut of the initial Kidds budget mainly by buying less SM-IIs and spending less on training and logistics.

The navy initially planned to buy around 248 SM-IIs but now might have to take nearly 100 from the order, sources said.

If the training costs are to be cut at the same time, the navy might send fewer personnel to the US to arrange for the deliveries of the four ships.

At the end of this year, the navy will dispatch hundreds of personnel to the US to learn how to operate the Kidds.