| Sam Wormley 2007-09-19, 4:33 am |
| Brussels to present finance plans to save Galileo satnav project
http://www.gpsdaily.com/reports/ Br...>
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Brussels (AFP) Sept 18, 2007
The European Commission will on Wednesday present its public
financement plans for the troubled Galileo satellite navigation
network, with unused farm funds viewed as a potential piggy bank,
according to sources.
Whatever the solution, the warnings are growing that the whole
project, seen as a showcase for Europe's technical know-how, could
crash and burn without a swift funding agreement.
"For us it's not time for more options but for decisions," said
European Transport Commissioner Jacques Barrot.
"If no decision is made before the end of December, including for
financing, the whole project will be placed in jeopardy," he added,
without detailing the Commission's proposals.
Galileo is designed as an independent European alternative, for
civilian use, to the free, military-run global positioning system
(GPS) in the United States.
Promising location precision of around one metre, as opposed to ten
metres for the US version, the Galileo system, due to be up and
running by the end of 2012, has so far failed to get off the ground
due to cost over-runs and bickering among private contractors.
Somehow the Commission needs to find an extra 2.4 billion euros from
the public coffers to finance the project in the 2007-2013 period.
Critics have warned that the costs could keep rising and have
questioned the logic of replicating the existing, free US service.
Also while Europe has dithered over Galileo, Russia and China have
been working hard on getting similar projects into the sky and at the
same time the United States is updating GPS, which is already used
widely in cars, boats and planes.
Last spring the European Commission adjudged that the emblematic
project could be helped from funds already in the EU budget, but
unused and theoretically to be redistributed to member states in the
form of credit.
According to European sources, the Commission could finally assure
the project's survival through affording it unused funds from the
Common Agricultural Policy for 2007 and 2008.
Brussels, while favouring communal funding, has also been persuaded
to submit an alternative proposal under which the EU governments
involved in the project would make supplementary contributions,
according to sources.
While Germany, where industry has a key role in Galileo, strongly
supports that approach, France feels it leans too heavily on the
public purse.
In the second scenario the European Space Agency, expected to manage
the whole project under Brussels supervision, would put forward half
the funding with interested member states stumping up the other half.
Under that scenario contributing countries would be guaranteed
contracts for their industry companies.
ESA comprises 17 countries -- 15 members of the European Union (EU)
plus Switzerland and Norway.
Industries in France, Germany, Italy and Spain are particularly
involved in the project.
On the other hand Britain and the Netherlands, notably, have
reservations.
Under the original plan, public money was supposed to pay for the
first four satellites and then the private consortium companies
building the satellites were to pay for two-thirds of the 26
remaining satellites.
The companies -- AENA, Alcatel, EADS, Finmeccanica, Hispasat,
Inmarsat, TeleOp and Thales -- were to cover their investment costs
by then operating the satellites and collecting the fees once they
were in operation.
However, after successive deadlines were missed as the companies
argued over their share of the pie, the European Commission
recommended a shake-up that would see the whole project financed with
public money.
Not wanting to be left out in the cold, the main industrials involved
-- Astrium (EADS group) and Thales Alenia Space (Thales and
Finmeccanica groups) -- have stressed in recent months their wish to
pursue industrial cooperation in the project.
EU transport ministers conceded in June that more public funding was
required. They will meet again in Luxembourg on October 2 to examine
the options which the Commission comes up with.
EU finance ministers, and behind them their heads of state and
government, will also have to give the green light to a revised
financial plan.
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