AUKUS: Australia pays $830m for replacing non-nuclear French submarines.

The Australian government has agreed to pay A$830 million ($579 million) to Naval Group in restitution for the former Morrison administration's controversial decision to cancel the French attack class submarine project.

On Saturday, Prime Minister Anthony Albanese declared that the confidential settlement will put an end to the scrapped $90 billion projects. Labor provided bipartisan backing for the AUKUS alliance, which succeeded the project and under which the United States and the United Kingdom have committed to assist Australia in acquiring at least eight nuclear-powered submarines and cooperating on other sophisticated technologies.

Read next: Australia to invest $7.4 billion in new pacific base for AUKUS subs

However, Albanese stated on Saturday that the manner the former Morrison administration handled the situation "has caused enormous tension in the relationship between Australia and France."

“This is a fair and an equitable settlement which has been reached. It follows, as well, discussions that I’ve had with President [Emmanuel] Macron and I thank him for those discussions and the cordial way in which we are re-establishing a better relationship between Australia and France,” he said.

The agreement was reached just three weeks after the federal election by the new Labor government. Albanese admitted that the prior government did not strike an agreement before the election.

The entire cost of the failed submarine project for Australian taxpayers is $3.4 billion, which is less than the $5.5 billion claimed by the government as the total approved budget for the project. As previously revealed by the Guardian Australia, officials regarded this to be a maximum "envelope."

Despite the lower cost, Albanese called it "an extraordinary waste from a government that was always big on the announcement but not good on delivery, and from a government that will be remembered as the most wasteful government in Australia's history since federation."

The prime minister announced that Australia would develop its relationship with France, but Macron accused Morrison of lying to him about the deal.

Parts of a message exchange between the two leaders were disclosed to Australian media outlets in an alleged attempt to blunt the idea that France had been completely blindsided by the cancellation. French officials denounced the leaking as “an unprecedented new low”.

Macron, on the other hand, had warmly hailed Albanese's victory last month, extending an offer to the prime minister to visit Paris, which the prime minister stated he had accepted.

“I see a personal meeting between myself and President Macron in France as being absolutely vital to resetting that relationship, which is an important one for Australia’s national interests.”

Virginia-class submarines

On Thursday, opposition leader Peter Dutton claimed that as defense minister before the election, he devised a plan to buy two Virginia-class submarines by 2030 to fill the gap until the nuclear submarines arrive, claiming that he "formed a judgment the Americans would have facilitated exactly that."

Albanese said on Saturday that Dutton had presided over an “all-announcement, no-delivery” regime.

He said he would not make "on the run comments" regarding national security and defense if Australia was negotiating for the submarines Dutton described.

Read next: Australia to invest $7.4 billion in new pacific base for AUKUS subs

Virginia-class submarines

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