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### Viewing cable 07THEHAGUE105, NETHERLANDS: HARD DECISIONS ON DEFENSE BUDGET

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Reference ID | Created | Released | Classification | Origin
--- | --- | --- | --- | ---
07THEHAGUE105 | 2007-01-19 16:04 | 2011-01-17 00:12 | CONFIDENTIAL | Embassy The Hague

`

    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

`