VZCZCXYZ0030
OO RUEHWEB

DE RUEHTC #0105/01 0191627
ZNY CCCCC ZZH
O 191627Z JAN 07
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7923
INFO RUEHZG/NATO EU COLLECTIVE PRIORITY
RUEKJCS/CJCS WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY

C O N F I D E N T I A L THE HAGUE 000105 
 
SIPDIS 
 
SIPDIS 
 
STATE FOR EUR/UBI 
 
E.O. 12958: DECL: 01/19/2017 
TAGS: MARR PGOV PREL NL
SUBJECT: NETHERLANDS: HARD DECISIONS ON DEFENSE BUDGET 
 
Classified By: Ambassador Roland Arnall, reasons...



93207,1/19/2007 16:27,07THEHAGUE105,"Embassy The
Hague",CONFIDENTIAL,,"VZCZCXYZ0030
OO RUEHWEB
DE RUEHTC #0105/01 0191627
ZNY CCCCC ZZH
O 191627Z JAN 07
FM AMEMBASSY THE HAGUE
TO RUEHC/SECSTATE WASHDC IMMEDIATE 7923
INFO RUEHZG/NATO EU COLLECTIVE PRIORITY
RUEKJCS/CJCS WASHDC PRIORITY
RHEHNSC/NSC WASHDC PRIORITY
RUEKJCS/SECDEF WASHDC PRIORITY
","C O N F I D E N T I A L THE HAGUE 000105
SIPDIS
SIPDIS
STATE FOR EUR/UBI
E.O. 12958: DECL: 01/19/2017
TAGS: MARR PGOV PREL NL
SUBJECT: NETHERLANDS: HARD DECISIONS ON DEFENSE BUDGET
Classified By: Ambassador Roland Arnall, reasons 1.4 (b,d)

¶1. (C) Summary: Dutch MOD leadership is searching for
""creative ways"" to preserve some 2007 defense investment
projects, including unmanned aerial vehicle (UAV) and CH-47
Chinook helicopter acquisition, and participation in NATO's
C-17 Strategic Airlift Initiative. While Joint Strike
Fighter (JSF) participation looks solid, the number of
acquired JSF aircraft will likely be decreased, and
acquisition of Tactical Tomahawk (TACTOM) missiles is all but
dead for political reasons. MOD leadership expected no cuts
-- or increases -- to future defense budgets as a result of
the new government currently in formation. MOD Director for
General Policy Affairs Lo Casteleijn and Dutch CHOD Gen.
Berlijn discussed these issues with the Ambassador on January
¶19. Defense Minister Kamp and MOD State Secretary van der
Knaap will discuss defense budget options further on January
¶24. End Summary.

Hard Decisions; Looking for Creative Solutions
--------------------------------------------- -

¶2. (C) Casteleijn acknowledged that the GONL will need to
make some hard decisions on defense investments for 2007 due
to over-spending on 2006 defense projects and political
sensitivities associated with the Labor Party (PvdA) joining
the new government. He said Kamp and van der Knaap were
looking for ""creative solutions"" to save or postpone some
2007 investments. Embassy contacts report that due to a
family crisis and illness, Kamp and van der Knaap delayed
reviewing options until January 24.

¶3. (C) One such project included Dutch interest in the U.S.
Predator B unmanned aerial vehicle (UAV) program, which
Casteleijn argued was vital -- postponing or canceling UAV
acquisition would be a step backward. Casteleijn also
mentioned the NATO C-17 Strategic Airlift Initiative as
another targeted project to try and save, but added that much
depended on who will be the new defense minister, and whether
he/she would prioritize the project after cost increases
associated with the initiative.

Joint Strike Fighter
--------------------

¶4. (C) Casteleijn said the GONL will likely purchase two
early JSF aircraft in order to participate in the test and
evaluation program. He expected the new government to honor
all previous JSF commitments, including participation in the
production, sustainment and follow-on phase. However,
Casteleijn suggested the new government will most likely
decrease the number of total planes purchased. For planning
purposes, the current government has stated plans to purchase
85 JSF aircraft.

TACTOM is Dead
--------------

¶5. (C) For political reasons, Casteleijn said the most likely
2007 defense investment casualty will be the Tactical
Tomahawk (TACTOM) missile acquisition. Casteleijn explained
that current Defense Minister Kamp fervently supports TACTOM
as a method of maximizing the capabilities of the smaller
Dutch navy, but suggested Kamp is largely isolated on the
acquisition. PvdA views TACTOM as an aggressive, unnecessary
weapon with a ""U.S.-controlled"" targeting system. Even PM
Balkenende's Christian Democratic Alliance (CDA) questions
the need for TACTOM, and Kamp's impending departure from
government will all but kill the acquisition.

¶6. (C) Ambassador Arnall argued for prudence, and suggested
quietly shelving TACTOM instead off abandoning it in order to
keep options open -- after all, the Dutch are the third
country in the world cleared to acquire TACTOM. Casteleijn
took the point, but said that decision will be left to the
new defense minister. He suggested a new defense minister
from PvdA might want for political reasons to demonstrate
independence from the United States by publicly abandoning
TACTOM.

Chinook Delay?
---------------

¶7. (C) Dutch CHOD Gen. Berlijn acknowledged that the MOD was
looking at methods to preserve funding for the acquisition of
six CH-47 Chinook helicopters with specialized
Honeywell-configured cockpits. Berlijn said Chinooks were
vital for the Dutch mission in Afghanistan, and the MOD is
working with Finance Minister Zalm on creative methods to
preserve the program. Berlijn said Zalm understands the
importance of the Chinooks, but may not have the political
leeway to shift funds from property sales to preserve the
acquisition. If not, the acquisition may be delayed by three
years, Berlijn said.

Static Defense Budget
---------------------

¶8. (C) Casteleijn argued the importance of maintaining
current defense spending given Dutch overseas military
operations, and anticipated no future defense budget cuts --
or increases -- resulting from the new coalition currently
being formed. He acknowledged that the ""graying of the
population,"" coupled with antiquated education and social
security systems could put tremendous pressure on the defense
budget. However, he described PvdA leadership as
""pragmatic,"" and said the defense minister, should he come
from PvdA, will understand the importance of preserving the
defense budget. That said, he did acknowledge that
""efficiency"" cuts across the national budget could affect
defense spending -- these ""corrections in course"" had been
issued in the past, and reflected fiscal, apolitical
decisions.
ARNALL