U.S. lawmakers urge tanker contract for Boeing now

WASHINGTON (Reuters) - Some members of the U.S. Congress on Wednesday called on Defense Secretary Robert Gates to immediately award a controversial $35 billion (17.8 billion pounds) Air Force tanker refuelling contract to Boeing BA.N.

“I think the Air Force could accept the Boeing proposal at this time,” said Sen. Sam Brownback, Kansas Republican. Noting the firings of two top Air Force officials earlier this month, Brownback and other lawmakers said Gates is now in charge of overseeing the contract to build new aerial tankers.

Brownback called for the action after the Government Accountability Office urged the Air Force to reconsider its February 29 award of the contract to Northrop Grumman NOC.N and European partner EADS EAD.PA, the parent of Airbus.

The Air Force has 60 days to respond to the GAO recommendation.

Lawmakers from Washington state and Kansas, where Boeing has large plants employing thousands of workers, said the GAO decision confirmed their view that Boeing should have won the contract.

Los Angeles-based Northrop, meanwhile, has been championed by lawmakers from Alabama, where the company planned to modify Airbus A330s into the KC-45 tanker for the Air Force. Northrop had argued that its tanker plan would create about 48,000 U.S. jobs, 4,000 more than Boeing backers say will be supported by Boeing’s plan.

Congressional supporters of Northrop said they were disappointed by the GAO decision.

“I am confident the merits of the Northrop Grumman/EADS tanker will be acknowledged,” said Republican Sen. Jeff Sessions of Alabama. “It is important to note that this was a decision based on errors in process, not on the relative merits of the aircraft.”

Some pro-Boeing lawmakers speaking at a news conference acknowledged that the Air Force might decide to rebid the contract instead of immediately granting it to Boeing as they had hoped, and said they were preparing legislation to ensure the Pentagon makes the “right decision.”

Sen. Pat Roberts, a Kansas Republican, said nonbinding resolutions will be introduced in the Senate and House of Representatives on Wednesday urging the Air Force to act quickly. “It is time for the Air Force to rebid the contract on merits,” Roberts said.

The pro-Boeing lawmakers also left open the possibility that they could block Northrop from getting the contract through amendments to bills authorizing Defense Department programs and funding Pentagon operations next year.

“If the Air Force doesn’t get it right, I’m going to reserve all my options as a member of the (House) Appropriations Committee to offer amendments and do anything I can to stop this thing from going forward,” said Rep. Norman Dicks, a Washington Democrat.

The same lawmakers also complained that the Pentagon did not appear to take into consideration Airbus’ foreign government subsidies, higher fuel costs of its tanker, and U.S. national security issues in granting the contract to a foreign firm.

They said Congress should consider revamping defence procurement laws to take such factors into consideration.

Reporting by Richard Cowan, editing by Richard Chang