Project Data Summary Sheet 134

Project Number AIR 9000 Phase 2, 4 and 6

Project Name MULTI-ROLE HELICOPTER
First Year Reported in the 2008-09
MPR
Capability Type Replacement
Acquisition Type Australianised MOTS
Capability Manager Chief of Navy and Chief of Army
Government 1st Pass Apr 06 (Phases 4 and 6)
Approval
Government 2nd Pass Aug 04 (Phase 2), Apr 06 (Phases
Approval 4 and 6)
Total Approved Budget $3,733.8m
(Current)
2016-17 Budget $175.5m
Project Stage Initial Materiel Release
Complexity ACAT I
Section 1 – Project Summary
1.1 Project Description

Part 3. Project Data Summary Sheets

The Multi-Role Helicopter (MRH) Program is a key component of the Australian Defence Force (ADF) Helicopter Strategic Master Plan
that seeks to rationalise the number of helicopter types in ADF service. The MRH Program consists of three phases of AIR 9000. Phase
2 (12 helicopters) is the acquisition of an additional Squadron of troop lift aircraft for the Australian Army, Phase 4 (28 helicopters) will
replace Army’s Black Hawk helicopters in the Air Mobile and Special Operations roles, and Phase 6 (6 helicopters) will replace Royal
Australian Navy (RAN) Sea King helicopters in the Maritime Support Helicopter role. All three phases are grouped under the AIR 9000
MRH Program.

1.2 Current Status

On 28 November 2011, the Minister for Defence announced this project as a Project of Concern.
Cost Performance
In-year
The project has spent $104.4m against a budget of $175.5m to June 2017. The $71.1m underspend to June 2017 is primarily due
to net adjustments to payment phasings across the Prime Acquisition and delays in finalising Contract Change Proposals. This
is offset against a foreign currency loss.
Project Financial Assurance Statement
As at 30 June 2017, project AIR 9000 Phase 2, 4 & 6 has reviewed the approved scope and budget for those elements required to
be delivered by the project. Having reviewed the current financial and contractual obligations of the project, current known risks and
estimated future expenditure, Defence considers, as at the reporting date, there is sufficient budget remaining for the project to
complete against the agreed scope.
Contingency Statement
The project has applied contingency in the financial year primarily for the treatment of various supportability and performance risks
such as a replacement Mission Management System, Fast Roping, Rappelling and Extraction System, Eurogrid Tactical
Mission Computer, Multi Function Displays New Generation, and Landing Helicopter Dock supplies support.
Schedule Performance
As a result of the Deed 2 negotiations with the contractor, the final delivery of aircraft has been rescheduled to July 2017; this, and
ongoing technical deficiencies, have resulted in delays to the Final Materiel Release (FMR) and Final Operational Capability (FOC)
milestones. However, a number of capability milestones have been declared, including Army Initial Operational Capability (IOC) in
December 2014, Navy IOC in February 2015, first Operational Capability Land (OCL1) in September 2015, second and third
Operational Capability Amphibious (OCA2/3) in December 2015, and the second Operational Capability Land (OCL2) in March 2016.
The FMR and FOC dates are currently under review and are expected to be clarified in Quarter 4 2017 with the approval of a
revised Materiel Acquisition Agreement.
Forty six aircraft have been accepted into service with the final aircraft programmed for acceptance in July 2017. The first

134 Notice to reader

MRH90 Helicopters

Forecast dates and Sections: 1.2 (Materiel Capability Delivery Performance), 1.3 (Major Risks and Issues), 4.1 (Measures of Materiel Capability Delivery Performance), and 5
(Major Risks and Issues) are excluded from the scope of the ANAO’s review of this Project Data Summary Sheet. Information on the scope of the review is provided in the
Independent Assurance Report by the Auditor-General in Part 3 of this report.

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 thirteen aircraft required an in-service retrofit to bring them up to the full Phase 2/4/6 capability baseline. All thirteen aircraft have now
been retrofitted and accepted back into service.
Remediation to rectify concerns regarding configuration management issues of production aircraft has slowed the acceptance of
production aircraft, this in turn has slowed the rate of capability growth.
The Chief of Army has agreed to delay introduction of MRH90 into 6th Aviation Regiment by 3 years, because of reliability and
design shortfalls, extending the Black Hawk fleet to 2022 to mitigate the risk to capability. The delayed introduction to 6th Aviation
Regiment will mean the growth in total MRH90 flying hours will temporarily stabilise below the planned mature rate. The aircraft
intended for 6th Aviation Regiment will continue to be accepted and rotated through the fleet.
Both Full Flight Mission Simulators have been accepted (the first in August 2013 and the second in October 2014).
Materiel Capability Delivery Performance
Following achievement of In-Service Date (ISD) with agreed partial achievement of the contracted MRH capabilities, there has been
significant work by both Industry and the Commonwealth to define and implement a series of capability block enhancements to bring
the MRH90 to contracted standards. This included a retrofit program to progressively bring all aircraft up to the contracted standard.
MRH is currently achieving three quarters of the required Rate of Effort (ROE). . However, this is due to the proportionately larger
stock of spares which is designed to support the full fleet. Further improvements to aircraft serviceability has commenced as part
of a maintenance reliability program to maintain and subsequently improve this ROE as the final aircraft are delivered.

Note
Forecast dates and capability assessments are excluded from the scope of the review.

1.3 Project Context

Part 3. Project Data Summary Sheets

Background
The Additional Troop Lift project was first foreshadowed in the Defence White Paper 2000.
The MRH Program consists of Phases 2, 4 & 6. Phase 2 was approved initially, providing 12 additional Troop Lift helicopters for
Army. Phases 4 & 6 were approved subsequently with Phase 4 which provided 28 helicopters as the replacement of the Australian
Army’s fleet of 34 S-70A-9 Black Hawk helicopters, again for troop lift capability, and Phase 6 provided 6 helicopters as the
replacement of the RAN’s fleet of six Sea King helicopters, providing maritime support capability for Navy. The delivery of a 47th
MRH90 was negotiated as part of Deed 2. This enables the use of one airframe as a Ground Training Device without impacting the
operational fleet.
In total, the AIR 9000 MRH Program will acquire 47 MRH90 aircraft and support systems. Support capabilities, such as Electronic
Warfare Self Protection Support System, MRH Software Support Centre, MRH Instrumentation System and a Ground Mission
Management System, will be acquired along with training systems and in-service support.
The Phase 2 Acquisition Contract was signed with Airbus Group Australia Pacific (Airbus Group AP) in June 2005 with the
subsequent Sustainment and Program Agreement contracts signed in July 2005.
In November 2005 the Defence Capability and Investment Committee agreed that the way forward was to seek a combined first and
second pass approval for both Phases 4 and 6 as part of a single approval process.
Cabinet endorsement was gained in April 2006 in a combined first and second pass process for Phase 4 and Phase 6. The agreed
method of procurement, a two stage Contract Change Proposal (CCP), resulted in the execution of options contained in the Program
Agreement for the procurement of additional aircraft approved under Phases 4 and 6. Initial CCPs for the Acquisition, Sustainment
and Program Agreement Contracts were signed in June 2006.
The three AIR 9000 Phase 2/4/6 contracts (Program Agreement Contract, Acquisition Contract and Sustainment Contract)
incorporate the above CCPs. On acceptance of two MRH90, appropriate training, maintenance and supply support, an In-Service
Date of December 2007 was achieved with aircraft operating under a Special Flight Permit granted by the Chief of Air Force. This
triggered the Sustainment Contract to come into effect and all three contracts are now currently active.
The Commonwealth suspended acceptance of aircraft from Airbus Group AP in November 2010; deliveries recommenced in
November 2011 after negotiations of a remediation plan (Deed of Agreement and CCPs) to address a number of engineering and
reliability issues. Concurrent with the recommencement of aircraft acceptance in November 2011, the Minister for Defence
announced that the project would be listed as a Project of Concern citing schedule, aircraft technical deficiencies and Airbus Group
AP’s performance.
The Commonwealth has conducted negotiations with the prime contractor to review and settle commercial, technical and schedule
issues resulting in a variation to the original contract signed on 9 May 2013, which has been termed ‘Deed 2’. Deed 2, which came
into effect on 1 July 2013 re-baselined the delivery schedule and addressed commercial and technical issues.
Uniqueness
The MRH90 aircraft is based upon the German Army variant of the NH90 Troop Transport Helicopter. The MRH90 design uses well
established aerospace technologies, but will introduce new technologies into Army and Navy, primarily in the areas of composite
structure, helmet mounted sight and display and fly-by-wire flight control systems.
The MRH Program is providing an MRH90 capability to two main users - Army and Navy. The capability delivery complexity this
introduces has been mitigated through an agreement between Chief of Army and Chief of Navy. This provides the project with a
single interface for introduction into service issues.
MRH90 Helicopters

The MRH Program Office Design Acceptance Strategy is dependent upon the French Military Airworthiness Authority’s (Direction
Générale de l’Armament (DGA)) prior acceptance of the NH90 variants and certification recommendation for the MRH90. The DGA
and other National Qualification Organisations’ prior acceptance of European NH90s provide confidence for the ADF to leverage off

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common certification evidence for the MRH90.
Major Risks and Issues
Aircraft system lack of maturity has affected the certification schedule of the MRH90 and subsequently the declaration of capability
milestones. Cabin integration issues, including the Fast Roping and Rappelling Device, the self-defence gun mount and the cabin
seating have impacted the achievement of these capability milestones.
The volume of engineering change proposals has impacted aircraft delivery. In addition, the project is managing issues affecting
Final Materiel Release including the Common Mission Management System, a replacement Fast Roping, Rappelling and Extraction
System, the Electronic Warfare Self Protection System, the Full Flight Mission Simulator, the Enhanced Cargo Hook System, the
Taipan Gun Mount and the Aero-medical Evacuation Capability.
The remediation of these deficiencies and issues through replacement or re-design will draw upon significant engineering, logistic
and commercial resources and will therefore form the critical path toward achieving the Final Materiel Release.
There is a risk that the project may not be able to retain sufficient levels of experienced and skilled manpower to achieve the
required rate of Acquisition deliverables. In addition, there is also a risk that Industry may not be able to retain sufficient
workforce, prior to Acquisition Project closure, to sustain the timely delivery of the remaining capability elements.
Other Current Sub-Projects
AIR 9000 Phase 7 Helicopter Aircrew Training System (HATS): HATS will be an important link in the training continuum for inductees
to the MRH 90 training system.
Note
Major risks and issues are excluded from the scope of the review.

Part 3. Project Data Summary Sheets

Section 2 – Financial Performance
2.1 Project Budget (out-turned) and Expenditure History
Date Description $m Notes
Project Budget
Apr 04 Original Approved 3.3 1
Aug 04 Government Second Pass Approval 953.9
Jun 06 Real Variation – Scope 2,565.6 2
Oct 06 Real Variation – Transfer (219.0) 3
Oct 08 Real Variation – Transfer (20.0) 4
Oct 08 Real Variation – Scope 31.5 5
3,312.0
Jul 10 Price Indexation 679.8 6
Jun 17 Exchange Variation (261.3)
Jun 17 Total Budget 3,733.8

Project Expenditure
Prior to Jul 16 Contract expenditure – Airbus Group AP (2,536.2)
Contract expenditure – CAE Australia (169.7)
Other Contract Payments / Internal Expenses (218.3)
(2,924.2)

FY to Jun 17 Contract expenditure – Airbus Group AP (80.4)

Contract expenditure – CAE Australia (2.3)
Other Contract Payments / Internal Expenses (21.7) 7
(104.4)
Jun 17 Total Expenditure (3,028.6)

Jun 17 Remaining Budget 705.1

Notes
1 This project’s original budget amount is that prior to achieving Second Pass Government Approval.
2 Incorporation of AIR 9000 Phase 4 (Black Hawk Upgrade/Replacement) and AIR 9000 Phase 6 (Maritime Support Helicopter).
MRH90 Helicopters

3 The funding related to facilities elements of the project was managed by Defence Estate and Infrastructure Group (DE&IG).
4 Transfer to DE&IG for Facilities Infrastructure.
5 Real Cost Increase funding for Full Flight Mission Simulator.

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 6 Up until July 2010, indexation was applied to project budgets on a periodic basis. The cumulative impact of this approach was
$556.1m. In addition to this amount, the impact on the project budget as a result of out-turning was a further $123.7m having
been applied to the remaining life of the project.
7 Other expenditure: $21.7m for operating expenditure, contractors, consultants, contingency and other capital expenditure not
attributable to the aforementioned contracts.

2.2A In-year Budget Estimate Variance

Estimate Estimate Estimate Explanation of Material Movements
PBS $m PAES $m Final Plan $m
174.4 180.8 175.5 The variance between PBS and PAES estimates is due to new
prime contract deliverables in Financial Year 2016-17 in relation
to Eurogrid Tactical Mission Computer and Multi Function
Displays New Generation and foreign exchange funding
increase.
The variance between PAES and Final Plan estimates primarily
reflects reprogramming of prime contract milestone and Full
Flight Mission Simulator Contract deliverables.
Variance $m 6.4 (5.3) Total Variance ($m): 1.1
Variance % 3.7 (3.0) Total Variance (%): 0.6
2.2B In-year Budget/Expenditure Variance
Estimate Actual Variance Variance Factor Explanation
Final Plan $m $m $m
Part 3. Project Data Summary Sheets

(77.5) Australian Industry The $71.1m underspend reflects net

Foreign Industry adjustments to payment phasings
Early Processes across the Prime Acquisition, Full
6.9 Defence Processes Flight Mission Simulator and
Foreign Government Upgrade Contract, a foreign
Negotiations/Payments exchange loss against foreign
Cost Saving currency payments and other minor
(0.5) Effort in Support of Operations procurement requirements.
Additional Government Approvals
175.5 104.4 (71.1) Total Variance
(40.5) % Variance

2.3 Details of Project Major Contracts

Contractor Signature Date Price at Type (Price Basis) Form of Contract Notes
Signature $m 30 Jun 17
$m
Airbus Group Jun 05 846.3 2,888.4 VARIABLE ASDEFCON 1, 2,
AP (Strategic) 3, 4
CAE Dec 07 180.5 176.6 VARIABLE ASDEFCON 4, 5
Australia (Complex)
Notes
1 This contract also includes an Electronic Warfare Self Protection Support System, MRH Software Support System, MRH
Instrumented System and 23 Ground Mission Management System (GMMS) (4 Fixed GMMS, 7 Deployable GMMS, 1
Reduced, 9 Light and 2 interim GMMS). Contract Base date is January 2004.
2 The MRH Instrumented System includes an airborne instrumentation pallet, some ground based instrumentation and three
aircraft (from the total fleet of 47) that have provisions to have the instrumentation pallet installed.
3 The increase from the original contract value is predominantly due to the increase in aircraft ordered and associated
systems following government approved scope changes as described in Section 1.3. Since 1 July 2016, there have been
key CCPs processed for a Fast Roping, Rappelling and Extraction System, Eurogrid Tactical Mission Computer,
Multi Function Displays New Generation, and Landing Helicopter Dock supplies support
4 Contract value as at 30 June 2017 is based on actual expenditure to 30 June 2017 and remaining commitment at current
exchange rates, and includes adjustments for indexation (where applicable).
5 The Commonwealth has conducted negotiations with the Contractor, to review and settle commercial and technical issues,
in December 2015.
Contractor Quantities as at Scope Notes
Signature 30 Jun 17
Airbus Group 12 47 MRH90 Aircraft 1
AP
CAE 2 2 Full Flight and Mission Simulator
Australia
Major equipment received and quantities to 30 Jun 17
MRH90 Helicopters

Forty six MRH aircraft have been accepted to date. Both Full Flight Mission Simulators have been accepted by the Commonwealth.
Notes
1 The delivery of a 47th MRH90 was negotiated as part of Deed 2. This enables the use of one airframe as a Ground
Training Device without impacting the operational fleet.

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Section 3 – Schedule Performance
3.1 Design Review Progress
Original Current Achieved Variance
Review Major System / Platform Variant Notes
Planned Planned /Forecast (Months)
System MRH aircraft - Phase 2 Aug 05 Oct 05 Sep 05 1 1
Requirements MRH aircraft - Phase 4/6 Apr 07 Apr 07 May 07 1 1
MRH Software Support Centre N/A Mar 07 Apr 07 1
Electronic Warfare Self Protection N/A N/A Nov 05 N/A
Support System
Ground based Mission planning and Oct 05 Oct 05 Feb 07 16 2
Management System
MRH Instrumented System N/A Jun 07 Jul 07 1
Full Flight and Mission Simulators May 08 Nov 08 Mar 09 9 3
System Design Full Flight and Mission Simulators Oct 08 Mar 09 Jun 09 8 3
Preliminary MRH aircraft - Phase 2 Jan 06 Jan 06 Apr 06 3
Design MRH aircraft - Phase 4/6 N/A N/A Jun 08 N/A
MRH Software Support Centre N/A Jun 07 Jun 07 0
Electronic Warfare Self Protection Mar 06 Mar 06 May 06 2
Support System

Part 3. Project Data Summary Sheets

Ground based Mission planning and Jul 06 Apr 07 Jun 07 11 2
Management System
MRH Instrumented System N/A Jun 07 Jul 07 1
Full Flight and Mission Simulators Feb 09 Sep 09 Oct 09 8 3
Critical Design MRH aircraft - Phase 2 May 06 May 06 Jun 06 1
MRH aircraft - Phase 4/6 Aug 08 N/A Oct 08 2
MRH Software Support Centre N/A Oct 07 Sep 07 (1)
Electronic Warfare Self Protection Sep 06 Sep 06 Oct 06 1
Support System
Ground based Mission planning and Nov 06 Nov 07 Jul 08 20 2
Management System
MRH Instrumented System N/A Jun 08 Jun 08 0
Full Flight and Mission Simulators Aug 09 Feb 10 Apr 10 6 3
Notes
1 Delays in the Systems Engineering process have resulted from the more developmental nature of the aircraft system, with
the MRH90 variant being unique in some ways.
2 Ground Mission Management System software delays are directly attributable to aircraft schedule delivery slip.
3 Full Flight Mission Simulators design review delays stem primarily from slow Contractor derivation of requirements into a
suitable System and Subsystem Specification. This was compounded by delays in the prime contractor establishing a vital
subcontract with the aircraft manufacturer.

3.2 Contractor Test and Evaluation Progress

Test and Original Current Achieved Variance
Major System / Platform Variant Notes
Evaluation Planned Planned /Forecast (Months)
System MRH aircraft - Phase 2 Jul 06 Nov 06 Dec 06 5
Integration MRH aircraft - Phase 4/6 N/A N/A N/A N/A 1
MRH Software Support Centre N/A Oct 08 Nov 08 1
Electronic Warfare Self Protection Support N/A N/A Nov 07 N/A
System
Ground based Mission planning and N/A N/A N/A N/A 2
Management System
MRH Instrumented System Nov 08 May 09 Dec 09 13 3
Full Flight and Mission Simulators Jun 11 Sept 11 Sep 11 4 4
Acceptance Type Acceptance Review Special Flight Oct 07 N/A Dec 07 2 5
MRH90 Helicopters

Permit 1
Australian Military Type Certificate Dec 08 Dec 10 Apr 13 52 6
Full Flight and Mission Simulator #1 Jul 12 Aug 13 Aug 13 13 7

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 Full Flight and Mission Simulator #2 Jan 13 Oct 14 Oct 14 21 7
Ground based Mission planning and Feb 09 Sep 09 Dec 09 10 8
Management System Lot 1
Ground Mission planning and Feb 09 Dec 09 Apr 10 14 8
Management System Lot 2
Ground Mission planning and Sep10 Sep10 Mar 13 30 8
Management System Lot 3
MRH Software Support Centre Feb 09 Feb 09 Dec 08 (2)
Electronic Warfare Self Protection Support Dec 07 Dec 07 Dec 07 0
System
MRH Instrumented System Mar 10 Jun 10 Sep 11 18 9
Aircraft MRH aircraft #01 (First aircraft) Dec 07 N/A Dec 07 0
Acceptance MRH aircraft #05 (First Australian built Dec 08 N/A Dec 08 0
aircraft)
MRH aircraft #46 (Most Recent) Jul 14 Jun 17 Jun 17 35 10
MRH aircraft #47 (Next aircraft) Jul 17 Jul 17 Jul 17 0 10
MRH aircraft #47 (Final Aircraft) Jul 17 Jul 17 Jul 17 0
Notes
1 Phases 4/6 were rolled into the MRH Program from aircraft 13 onwards, which increased the number of aircraft from 12 to
Part 3. Project Data Summary Sheets

46.
2 The acceptance and test-readiness of the Ground Mission Management System (GMMS) was broken into six lots post
contract signature. The lots compose of GMMS deliverables that have been aligned to aircraft delivery – location and
baseline. The acceptance of GMMS lots are listed in the acceptance area of this table.
3 The 13 month delay to closure of Test Readiness Review was due to electronic compatibility test design issues not resolved
until November 2009. This delay was mitigated by the development of an interim MRH Instrumentation System capability
used for a test activity in October 2009.
4 Achieved through completion of Test Readiness Review for Contractor In-Plant Test and Evaluation in September 2011.
5 The first Airworthiness Board (for a Special Flight Permit (SFP)) was conducted in November 2007 and a SFP was granted
in December 2007. There have been a number of SFP extensions to allow flight trials of the aircraft as it further develops.
The most recent SFP was granted in December 2012 and expired in April 2013.
6 Achievement of the Australian Military Type Certificate proved problematic due to technical and reliability issues, leading to
insufficient levels of the Rate of Effort. Rate of Effort was required to validate that in-service support arrangements for the
fleet are sufficient to cope with current numbers of aircraft and are growing in maturity to meet fleet requirements. Australian
Military Type Certificate and Service Release was achieved 17 April 2013.
7 Refers to acceptance of Full Flight Mission Simulators in Oakey and Townsville. Delays have been incurred due to the late
delivery of facilities and an underestimation of the time required to implement the design.
8 Lot 1, 2 and 3 have been altered to accommodate the variation in aircraft delivery date and configuration.
9 The MRH instrumented system incurred delays due to technical and supportability issues that resulted in contractual non-
conformances. These non-conformances were rectified by September 2011.
10 The MRH90 program stopped accepting aircraft in November 2010 due to a number of technical and reliability issues. The
Commonwealth recommenced accepting aircraft in November 2011 after negotiating a remediation plan to address a
number of engineering and contractual issues; however acceptance of aircraft was again suspended in February 2012
pending resolution of another technical concern related to the aircraft’s cargo hook. In May 2012 the Commonwealth agreed
to accept a further four aircraft based on Airbus Group AP’s agreement to the commercial terms associated with the
rectification of the cargo hook issue. Scheduled aircraft acceptance recommenced in June 2012 with the most recent aircraft
(#46) accepted in June 2017.

3.3 Progress Toward Materiel Release and Operational Capability Milestones

Original Achieved Variance
Item Notes
Planned /Forecast (Months)
Initial Materiel Release (IMR) Army/Navy Jun 10 May 13 35 1
Initial Operational Capability (IOC) Navy Jul 10 Feb 15 55 2
Army Apr 11 Dec 14 44 3
Final Materiel Release (FMR) Army/Navy Oct 14 Oct 18 48 4,5
MRH90 Helicopters

Final Operational Capability (FOC) Navy Dec 12 - - 5,6

Army Jul 14 Jul 19 60 4,5

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Notes
1 The MRH90 program stopped accepting aircraft in November 2010 due to a number of technical and reliability issues. This
has impacted the achievement of capability milestones. The Commonwealth recommenced accepting aircraft in November
2011 after negotiating a remediation plan to address a number of engineering and reliability issues; however acceptance of
aircraft was again suspended in February 2012 pending resolution of another technical concern related to the aircraft’s cargo
hook. In May 2012 the Commonwealth agreed to accept a further four aircraft based on Airbus Group AP’s agreement to the
commercial terms associated with the rectification of the cargo hook issue. Scheduled aircraft acceptance recommenced in
June 2012 with the most recent aircraft (#46) accepted in June 17.
IMR was declared on 13 May 2013, based on 6 Product Baseline 003 aircraft.
2 Affected by delays to IMR. (Refer to Note 1 above)
3 Affected by delays to IMR. (Refer to Note 1 above)
4 Dates directly impacted by delay to IMR. (Refer to Note 1 above). The remediation of technical deficiencies and issues
through replacement or re-design will draw upon significant engineering, logistic and commercial resources and will therefore
form the critical path toward achieving FMR. The FMR and FOC dates are currently under review and are expected to be
clarified in Quarter 4 2017 with the approval of a revised Materiel Acquisition Agreement.
5 FOC is now only forecast as a single date. The last capability subset is to be realised by Army.
Schedule Status at 30 June 2017

Schedule Plan at
Approval
Government Approval

Part 3. Project Data Summary Sheets

IMR
IMR/FMR introduced in
FY 2010-11
IOC

Schedule Plan at 30 June

2017 FMR
Jun-04

Jun-05

Jun-06

Jun-07

Jun-08

Jun-09

Jun-10

Jun-11

Jun-12

Jun-13

Jun-14

Jun-15

Jun-16

Jun-17

Jun-18

Jun-19

Jun-20
FOC

Note
Forecast dates in Section 3 are excluded from the scope of the review.

Section 4 – Materiel Capability Delivery Performance

4.1 Measures of Materiel Capability Delivery Performance
Pie Chart: Percentage Breakdown of Materiel Capability Delivery Performance
Green:
A number of key capabilities have been delivered and service
released and the aircraft retrofit program is now complete.

Amber:
MRHPO remains focused on the timely delivery of capabilities
to support operational capabilities. There continues to be a
number of capabilities that will need to be progressed and
released including the redesign of Cargo Hook, the Common
Mission Management System, and the improved Fast Roping,
50% Rappelling and Extraction System.
Red:
N/A
MRH90 Helicopters

Note
This Pie Chart does not necessarily represent capability achieved. The capability assessments and forecasts by the project are not
subject to the ANAO’s assurance review.

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 4.2 Constitution of Initial Materiel Release and Final Materiel Release
Item Explanation Achievement
Initial Materiel Release (IMR) 1. Six Product Baseline 003 aircraft with associated Achieved
role equipment to support Initial Operational
Capability milestones;
2. Issue of Australian Military Type Certificate and
Service Release;
3. Completion of all MRH90 facilities at Townsville,
Oakey and Nowra;
4. Establishment of mature planned contractor
support to maintenance and logistics; and
5. Provision and certification of Mission
Management systems necessary for Initial
Operational Capability milestones.
Initial Material Release was achieved in May 2013.
Final Materiel Release (FMR) 1. 47 aircraft configured to the contractual baseline Not yet achieved
including configuration amendments specified in
Deeds 1 and 2 (one aircraft to be used as a
Maintenance Training Device);
2. Role equipment delivered to support aircraft;
3. A mature sustainment organisation capable of
discharging all in-service responsibilities; including
logistic and training requirements;
4. Mature training system with all training devices
Part 3. Project Data Summary Sheets

accepted, supported by an effective, functioning

training organisation; and
5. All facilities and support equipment, required to
support the capabilities accepted.
The project is focused on the timely delivery of
capability to meet future operational milestones. This
includes the delivery of crucial products such as the
replacement Cargo Hook, the Fast Roping and
Rappelling Device and a Common Ground Mission
Management System.

FMR is forecast to be achieved in October 2018

Section 5 – Major Risks and Issues

5.1 Major Project Risks
Identified Risks (risk identified by standard project risk management processes)
Description Remedial Action
There is a risk that the achievement of the FMR will be affected a. Formation of Cabin Integration Working Group.
by delays in the delivery of supplies according to the contracted b. Industry Prototyping.
schedule leading to an impact on cost, schedule and c. Accept incremental improvements.
performance. d. Use of Liquidated Damages as offset.
e. Leverage NATO Helicopters 90 community solutions.
This risk has been amended to reflect the focus of delivering
materiel leading up to FMR.
There is a risk that the MRH Program may not be able to retain 1. Early identification of staff transition and turnover.
sufficient levels of experienced and skilled manpower to achieve 2. Detailed succession planning.
the required rate of Acquisition deliverables leading to an impact 3. Early engagement with Army and Royal Australian Air
on schedule and capability. Force posting Directorates and CASG, to identify
solutions.
4. Identify areas where contracted workforce can supplement
where applicable.
Emergent Risks (risk not previously identified but has emerged during 2016-17)
Description Remedial Action
There is a risk that Industry may not be able to retain 1. Apply provisions of the contract to incentivise delivery
sufficient workforce, prior to Acquisition Project closure, to to the schedule.
sustain the timely delivery of the remaining capability 2. Actively engage Industry and scrutinise performance
elements. against product delivery through the following forums:
a. Critical Item Review
b. Project Executive Meetings
MRH90 Helicopters

c. Project Management Review

d. Weapons Systems Working Group
e. Project Management Stakeholder Group

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5.2 Major Project Issues
Description Remedial Action
The Full Flight Mission Simulator configuration alignment with 1. Evaluate options for consolidating Full Flight Mission
the MRH90 aircraft has been affected by the length of time Simulator technologies to a single manufacturer.
required to upgrade to Sustainment Software Build 1.1. 2. Establish an efficient process of obtaining aircraft
documentation and associated software packages.
3. Integrate engineering change proposals between MRH90
aircraft and the Full Flight Mission Simulator.
The MRH90 Search / Landing Light (SLL) was assessed as not 1. Identify a replacement bulb for SLL capability.
fit for purpose due to beam width and lack of covertness. This 2. Implement solution to meet capability milestones.
reduced the range of illuminations under which the aircraft could A satisfactory replacement SLL solution has been identified,
conduct night flying and limited operational use. hence this Issue has been retired following delivery of the
solution (Novermber 2016).
The Electronic Warfare Self Protection system is not performing 1. Industry to conduct a technical assessment of the issues
to specification during specific aircraft manoeuvres. identified and provide recommendations for remediation.
2. Commonwealth to assess the validity of the
recommendations with system specialists Defence Science
and Technology Group.
3. Verification and validation of the remediation activities by
Industry.
4. Implement solution to meet capability requirements.
The Identification, Friend or Foe Mode 4 fitted to the MRH90 is This issue has been retired due to the achievement of

Part 3. Project Data Summary Sheets

not performing during specific scenarios. service release in July 2016.
The volume of engineering change proposals has impacted the This issue has been downgraded due to the increasing
timing and effective delivery of aircraft. maturity of engineering processes.
The Fast Roping and Rappelling is not suitable which has 1. Interim Fast Roping and Rappelling Device solution has
affected the achievement of operational capability leading to been design accepted and service release has been
an impact on schedule and performance. achieved.
2. Identify design options for enduring solution.
The Enhanced MRH Armament Sub-System (EMAS) is 1. Implement interim capability.
incompatible with an introduced weapon leading to an 2. Identify design options for enduring solution for both
impact on operational performance and delivery schedule. Navy and Army.
3. Implement agreed solution.
The existing Ground Mission Management System (GMMS) 5. Formation of user working group.
is not suitable for integration with the ADF mandated Joint 6. Develop and agree on options to meet capability
Mission Planning System (JMPS) leading to an impact on requirements.
MRH90 operational performance. 7. Implement agreed solution.
The initial AME solution is not suitable for high care or 1. Formation of Aero-Medical Evacuation capability
multiple extractions which will delay the final solution working group.
delivery schedule. 2. Develop and agree on the functional requirements
specification with Commonwealth stakeholders and
Industry.
3. Implement agreed solution.
The current Cargo Hook design is incompatible with 1. Develop Statement of Requirement for new Cargo
Australian Defence Equipment which will delay the final Hook.
solution delivery. 2. Industry to provide proposal for new Cargo Hook.
3. Develop and agree on options enduring solution to
meet capability requirements.
4. Implement agreed solution.

Note
Major risks and issues in Section 5 are excluded from the scope of the review.
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 Section 6 – Project Maturity
6.1 Project Maturity Score and Benchmark
Attributes

Operations and
Understanding
Requirement

Commercial
Maturity Score

Technical

Technical
Schedule

Difficulty

Support

Total
Cost
Project Stage Benchmark 10 8 8 8 9 8 9 60
Initial Materiel Project Status 7 7 9 9 8 7 9 56
Release Explanation • Schedule: The Final Materiel Release and Final Operational Capability dates are
currently under review and are expected to be clarified in late 2017 with the
approval of a revised Materiel Acquisition Agreement.
• Cost: Not all risks have been retired; however the estimate at completion to
mitigate remains within contingency guidance.
• Requirement: The MRH System design and acceptance testing phases are
essentially complete, with activities on-going for outstanding elements such as
cargo hook and mission troop seat. Additionally, the project office, with Navy and
Part 3. Project Data Summary Sheets

Army, is conducting validation trials to demonstrate that the system meets in-
service requirements.
• Technical Understanding: The knowledge necessary to operate and support the
platform is being transferred to the in-service providers.
• Technical Difficulty: Capability is still being tested fully due to the immaturity of
elements of the capability.
• Commercial: Deed 2 settled a number of long outstanding commercial issues
and has implemented sound management arrangements to provide confidence
that industry effort will be focused on capability realisation.

2015-16 MPR Status - - - - 2016-17 MPR Status - - - -

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Section 7 – Lessons Learned
7.1 Key Lessons Learned
Categories of
Project Lesson
Systemic Lessons
Early establishment of the Sustainment organisations. Both Commonwealth and Industry teams need to be Resourcing
set up well in advance of the first of the deliveries. The provision of accepted aircraft to an Operational
Squadron has led to a range of lessons in regard to command and control of assets and people, stakeholder
management and the relationship with Industry.
The impact of attaining limited Intellectual Property rights has been critical to the ongoing development of Contract
the capability and achievement of value for money in further contract negotiations. It has also limited the Management
provision of data for integration with other platforms (such as the Landing Helicopter Dock ships).
The MRH Program was incorrectly viewed as a Military off-the-Shelf (MOTS) acquisition. Lessons Off-the-shelf
associated with intended MOTS procurements include: that it is essential that the maturity of any offered Equipment
product be clearly assessed and understood; and that elements of a chosen off-the-shelf solution may not
meet the user requirement.
Better arrangements should be put in place to ensure appropriate considerations of contractor performance Contract
occur before the Commonwealth enters into similar contracts with the same contractor. Management

Section 8 – Project Line Management

Part 3. Project Data Summary Sheets

8.1 Project Line Management in 2016-17
Position Name
Division Head MAJGEN Andrew Mathewson
BRIG Anthony McWatters (Oct 15 to Apr 17)
Branch Head
BRIG Jeremy King (Apr 17 to current)
COL James Allen (to Jan 17)
Project Director
COL Brad Warren (Jan 17 – current)
Project Manager Mr Hilton Hunter

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Major Projects Sheets
Report
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2016–17 Major Projects Report
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Part 3. Project Data Summary Sheets
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