The cost of the LUXEOSys satellite is set to rise from €170m to €309m
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Satellite operator LuxGovSat has contradicted claims it pledged to run a military satellite slated for launch in 2022 that is facing scrutiny from parliament over exploding costs.
MPs in 2017 approved €170m for the LUXEOSys military satellite but the government is seeking to nearly double the budget after initial analyses failed to take into account a series of operational costs.
Parliament is mounting pressure on the government over the project. Lawmakers on Friday 25 September grilled LuxGovSat CEO Patrick Biewer over claims that the satellite operator had jumped ship on the project.
But LuxGovSat never formally committed to operating the satellite, Biewer said, adding the company lacked resources and staff. LuxGovSat could not be made responsible for the rise in costs, he said.
Former economy minister Etienne Schneider (LSAP) previously said LuxGovSat had all but confirmed its involvement in the project. But the company didn’t bid on the contract last year, much to the surprise of Schneider’s successor, François Bausch (déi Gréng).
“The project was underestimated and poorly budgeted,” Bausch said during a press conference in July.
Earlier this month, army general Alain Duschène said he had not been informed “in detail” of the LUXEOSys project. An analysis whether antennae needed to operate the satellite could be installed at the army’s HQ near Diekirch happened only after parliament voted on the initial bill, he said.
It turned out the site wasn’t suitable and, as a result, the prospective location for the base stations was moved to Redu, Belgium. More secure IT infrastructure and back-up servers further added to the satellite’s cost, which is now estimated at €309m.
Luxembourg has promised Nato that LUXEOSys would be operational by 2023. It forms part of plans to increase military spending, with the grand duchy far from a 2% of GDP spending pledge. It spent roughly 0.6% of GDP on the military last year and expects to increase this amount to 0.69% by 2023.
The satellite will deliver high resolution images of the Earth’s surface, for example to monitor natural disasters or provide intelligence on conflict zones.
The budget increase should come to a vote in parliament in October or November. But opposition lawmakers have not yet ruled out pushing for an official enquiry to hold the government to account over the poorly planned project. Should parliament fail to approve the extra funds, the money already spent on purchasing the satellite hardware would be lost, Bausch previously said.
Schneider in June said his team had been “convinced that it would work out”, adding that he would have had ample finances available had he thought the project would cost more.
Updated 28 September at 2.20pm: This article was amended to correct the name of LuxGovSat CEO Patrick Biewer.