Committee raises questions over value of the project

UK contributions to Europe’s Galileo global positioning system are running at £97m so far, and MPs are demanding that no more money be spent without a rigorous cost/benefit analysis.

The House of Commons Transport Committee questioned transport minister Rosie Winterton last week over the value of the 26-satellite programme that will provide Europe with navigation services independent of the US-owned GPS system.

So far only four orbits have been designed and developed and the cost to the EU has hit £1.1bn, way above initial estimates of £750m. The UK is set to contribute 17 per cent of the total cost, which is estimated to reach £5.5bn over two decades.

The UK contribution is equivalent to major domestic transport schemes, said committee chairman Gwyneth Dunwoody.

“Galileo has given us considerable concern,” she said. “How far are we prepared to go before we say Galileo is not having any more money?”

The government is continuing cautious support for the scheme because it offers greater resilience for commercial uses and the possibility of a broader range of applications.

“There are big implications for UK jobs and industry, but we have always said that we do not support Galileo at any price,” Winterton told the committee.

“There must be strong financial discipline, effective risk and project management, and a clear focus on what the commercial applications of the system will be.”

But wrangling over budgets, and the abandonment of the public/private partnership model, are still not fully resolved.

Last month the European Commission suggested meeting the E2.4bn (£1.7bn) funding shortfall by transferring money from agriculture, administration and research budgets.

An EU-wide decision on Galileo will be made before the end of the year.