LONDON/WASHINGTON, May 17 (Reuters) – Britain’s BAE Systems Plc (BAES.L: Quote, Profile, Research, Stock Buzz) agreed to pay up to $79 million in U.S. government fines for more than 2,500 alleged breaches of rules governing military exports, the State Department said on Tuesday.

The civil settlement is the biggest in the department’s history. It ends long-running corruption investigations into the company, Europe’s biggest arms maker by sales, on both sides of the Atlantic.

The department cleared BAE’s fast-growing U.S. unit and its subsidiaries of all charges against the parent company, based in Farnborough, outside London.

But it said a lack of full cooperation from the parent had left it “unable to assess fully the potential harm to U.S. national security” from the unauthorized resale of U.S. weapons and technology know-how to more than a dozen countries.

The U.S. subsidiary, BAE Systems Inc, accounts for about 52 percent of the company’s worldwide sales and is among the Pentagon’s top 10 suppliers. It operates a separate export compliance program under a special security pact that governs its dealings inside and outside the United States.

The State Department said it found a total of 2,591 BAE arms-control breaches after the parent company’s criminal conviction last year for violations of the U.S. Arms Export Control Act and International Traffic in Arms Regulations, which frame U.S. arms-control laws.

For instance, the department said, BAE failed to get a required U.S. nod to engage in “brokering activities” involving U.S. systems or sub-systems incorporated on the EF-2000 Eurofighter Typhoon. Since 1998, BAE has marketed or exported the fighter to Australia, Czech Republic, Greece, Netherlands, Norway, Poland, Saudi Arabia, Singapore, South Korea, Austria, Denmark, Japan and Switzerland, the department said.

WASHINGTON, May 13 (Reuters) – U.S. Air Force’s F-35 fighter, due to form the bulk of future U.S. tactical air power and to be bought by allies, may be able to fly only 85 percent as far as originally projected, a Pentagon document shows.

The radar-evading aircraft’s “A” model is currently estimated to have a combat mission radius of 584 nautical miles, just short of the required 590 nautical miles, a Dec. 31-dated report to Congress said.

Program officials originally estimated that the F-35A would be able to hit targets 690 nautical miles away, unrefueled, or 15 percent more than now, the Department of Defense’s “Selected Acquisition Report” showed.

The current combat radius prediction is based on estimates of the amount of compressed air diverted from the engine to run onboard systems as well on aircraft performance and fuel capacity that are not yet fully known, the report said.

“Current estimates have built-in margin that may not be realized,” it said, adding that aircraft modifications were possible to add fuel capacity that would boost the range.

The F-35 family of fighters is the Pentagon’s costliest arms purchase, projected to total some $382 billion over the coming two decades for 2,443 aircraft. Three models are being built for the U.S. Air Force, Navy, Marine Corps and allied countries by Lockheed Martin Corp (LMT.N: Quote, Profile, Research, Stock Buzz).

The Pentagon report appeared first on the Dew Line, an aerospace blog.

WASHINGTON, May 13 (Reuters) – Britain’s BAE Systems Plc (BAES.L: Quote, Profile, Research, Stock Buzz) said on Friday it had won an initial 10-year, $850 million contract to run the U.S. Army’s Radford ammunition plant in Virginia, the only domestic producer of a key material used in explosives and propellants.

BAE bested incumbent Alliant Techsystems Inc (ATK.N: Quote, Profile, Research, Stock Buzz) for the deal that includes three 5-year options that could stretch through 2036 and add significant new revenue, the company said.

Radford Army Ammunition Plant is a 6,900-acre government-owned, contractor-operated facility established in 1941 that produces rocket and gun propellants. It is the sole U.S. producer of nitrocellulose, the feedstock for ammunition used by the military, police officers, hunters and other recreational shooters.

Alliant Techsystems, also known as ATK, had operated the plant since 1995, when it completed the acquisition of Hercules Powder Co, which built the plant to meet World War Two military ammunition requirements.

ATK looks forward to “a debriefing from our government partners on this outcome,” said Bryce Hallowell, a company spokesman. The handover is due to take place after a six-month transition period.

J.P. Morgan North America Equity Research cut its earnings per share estimate for ATK by about 15 cents on an annualized basis after the announcement. Radford was contributing about 5 percent of company-wide sales, or about $240 million, it said.

The Radford loss also “heightened concerns” about ATK’s ability to hang on to a far larger contract to manage the Army ammunition plant at Lake City, Missouri, which is up for grabs in 2013, a note to investors said.

WASHINGTON (Reuters) – U.S. Defense Secretary Robert Gates said on Thursday his main goal before stepping down next month is to focus attention on strategic choices facing the nation as it flattens military spending to help curb the growing national debt.

He spoke hours after the House of Representatives Armed Services Committee authorized $690 billion for the U.S. military complex in fiscal 2012, including $119 billion to fund the war in Afghanistan and transition in Iraq.

The sum cleared by the committee for the year starting October 1 represented a small increase from the current fiscal year. It is projected to be a high-water mark as the wars wind down along with a post-September 11 military spending surge.

Gates told Marines at Camp Lejeune, North Carolina, that the issue involved tradeoffs between acceptable risks and defense capabilities that could be sacrificed.

“I am determined that we will not repeat what we did in the 1970s and 1990s, which is across-the-board cuts that end up hollowing out the force,” he said.

Gates is to step down on June 30. While he did not offer specific recommendations on the military’s future structure, he said he hoped to throw light on the choices at hand for President Barack Obama and other decision-makers, including his nominated successor as defense secretary, CIA director Leon Panetta.

“If you want to change the size of the budget in a dramatic way, what risk are you prepared to take in terms of future threats to the country?” Gates asked.

WASHINGTON, May 12 (Reuters) – U.S. Defense Secretary Robert Gates said on Thursday his main goal before stepping down next month is to focus attention on strategic choices facing the nation as it flattens military spending to help curb the growing national debt.

He spoke hours after the House of Representatives Armed Services Committee authorized $690 billion for the U.S. military complex in fiscal 2012, including $119 billion to fund the war in Afghanistan and transition in Iraq.

The sum cleared by the committee for the year starting Oct. 1 represented a small increase from the current fiscal year. It is projected to be a high-water mark as the wars wind down along with a post-Sept. 11 military spending surge.

Gates told Marines at Camp Lejeune, North Carolina, that the issue involved tradeoffs between acceptable risks and defense capabilities that could be sacrificed.

“I am determined that we will not repeat what we did in the 1970s and 1990s, which is across-the-board cuts that end up hollowing out the force,” he said.

Gates is to step down on June 30. While he did not offer specific recommendations on the military’s future structure, he said he hoped to throw light on the choices at hand for President Barack Obama and other decision-makers, including his nominated successor as defense secretary, CIA director Leon Panetta.

“If you want to change the size of the budget in a dramatic way, what risk are you prepared to take in terms of future threats to the country?” Gates asked.

WASHINGTON, May 12 (Reuters) – A bill that would provide $690 billion for the U.S. military complex in fiscal 2012, including operations in Iraq and Afghanistan, has been approved by the U.S. House of Representatives’ Armed Services Committee.

The legislation would authorize $553 billion for the Defense Department’s base budget, the same amount sought by President Barack Obama in the request he sent to Congress in February.

The bill also includes $119 billion for “overseas contingency operations” such as Iraq and Afghanistan plus $18 billion for the Energy Department’s military-related nuclear activities, Chairman Howard McKeon said in a statement on Thursday.

The Senate Armed Services Committee is expected to take up its version of the National Defense Authorization Act next month. The two versions must be passed by the full House and Senate and any differences must be ironed out before being sent to Obama for his signature into law.

Congress provided $668.6 billion for the U.S. military complex in fiscal 2011, which ends on Sept. 30, down from the $709 billion requested by Obama.

The House bill for 2012 added $425 million aimed at continuing the production line for the Army’s M1 Abrams tanks, a General Dynamics Corp (GD.N: Quote, Profile, Research, Stock Buzz) program, and M2 Bradley fighting vehicles, made by BAE Systems Plc (BAES.L: Quote, Profile, Research, Stock Buzz).

The plan currently advocated by the Army would result in the first break in tank production since 1941, lasting one to three years.

WASHINGTON, May 11 (Reuters) – A controversial second engine for the multinational F-35 fighter jet received a boost Wednesday from a U.S. House of Representatives committee preparing its version of a fiscal 2012 defense spending bill.

The House Armed Services Committee voted 54 to 5 to make sure that General Electric Co (GE.N: Quote, Profile, Research, Stock Buzz) and Rolls-Royce Group Plc (RR.L: Quote, Profile, Research, Stock Buzz) could go on working on their alternate engine using their own funds, despite the Pentagon’s formal cancellation of a competitive engine program last month.

The engine powering early production models of the F-35 is built by Pratt & Whitney, a unit of United Technologies Corp (UTX.N: Quote, Profile, Research, Stock Buzz). At stake is a business that GE and Rolls say will be worth more than $100 billion in coming decades and that Pratt reckons at about $50 billion.

The panel acted on an amendment to the defense authorization bill put forward by Rep. Robert Andrews, a New Jersey Democrat who has spearheaded a House effort to wring waste from the more than $100 billion the Pentagon spends on arms each year.

The legislation would require that the secretary of defense, at no cost to the federal government, allow for the continued development and testing of the alternate engine if this is self-funded, as GE and Rolls have proposed to do at least through the end of fiscal 2012.

The Defense Department cut off the contractors’ access to the hardware after Congress omitted funding for it in a long-delayed budget deal last month to cover U.S. spending for the rest of fiscal 2011, which ends Sept. 30.

GE and Rolls have offered to spend more than $100 million of their own to go on working on the alternate engine, a move hailed by the House panel’s chairman, Howard McKeon, as a potential watershed for how the Pentagon finances arms development.

WASHINGTON, May 11 (Reuters) – A controversial second engine for the multinational F-35 fighter jet received a boost Wednesday from a U.S. House of Representatives committee preparing its version of a fiscal 2012 defense spending bill.

The House Armed Services Committee voted 54 to 5 to make sure that General Electric Co (GE.N: Quote, Profile, Research, Stock Buzz) and Rolls-Royce Group Plc (RR.L: Quote, Profile, Research, Stock Buzz) could go on working on their alternate engine using their own funds, despite the Pentagon’s formal cancellation of a competitive engine program last month.

The engine powering early production models of the F-35 is built by Pratt & Whitney, a unit of United Technologies Corp (UTX.N: Quote, Profile, Research, Stock Buzz). At stake is a business that GE and Rolls say will be worth more than $100 billion in coming decades and that Pratt reckons at about $50 billion.

The panel acted on an amendment to the defense authorization bill put forward by Rep. Robert Andrews, a New Jersey Democrat who has spearheaded a House effort to wring waste from the more than $100 billion the Pentagon spends on arms each year.

The legislation would require that the secretary of defense, at no cost to the federal government, allow for the continued development and testing of the alternate engine if this is self-funded, as GE and Rolls have proposed to do at least through the end of fiscal 2012.

The Defense Department cut off the contractors’ access to the hardware after Congress omitted funding for it in a long-delayed budget deal last month to cover U.S. spending for the rest of fiscal 2011, which ends Sept. 30.

GE and Rolls have offered to spend more than $100 million of their own to go on working on the alternate engine, a move hailed by the House panel’s chairman, Howard McKeon, as a potential watershed for how the Pentagon finances arms development.

WASHINGTON, May 5 (Reuters) – General Electric Co (GE.N: Quote, Profile, Research, Stock Buzz) and Rolls Royce Group Plc (RR.L: Quote, Profile, Research, Stock Buzz) asked the Pentagon on Thursday to let them resume development, at their own expense, of a controversial alternate engine for the multinational F-35 fighter jet.

At stake is potential business that General Electric and others put at more than $100 billion in coming decades. It is also a challenge to President Barack Obama and Defense Secretary Robert Gates, who have dismissed the interchangeable engine project as unaffordable and a waste.

The Defense Department killed the competitive engine program last month in a boost for United Technologies Corp (UTX.N: Quote, Profile, Research, Stock Buzz), whose Pratt & Whitney subsidiary builds the engine powering early production F-35s.

The Defense Department’s stance on the program “has not changed,” said Cheryl Irwin, a Pentagon spokeswoman, in response to the GE-led team’s renewed push to keep its engine alive.

The radar-evading F-35, built by Lockheed Martin Corp (LMT.N: Quote, Profile, Research, Stock Buzz), is the Pentagon’s costliest arms purchase at some $382 billion for what are now due to be 2,443 planes.

GE and Rolls are prepared to spend more than $100 million of their own money to fund the second engine’s development through the end of fiscal 2012, GE spokesman Rick Kennedy said in an email.

“GE and Rolls Royce are simply asking that they are provided — at no cost to the government — access to the engines, components, and testing facilities to continue their development work,” he said.

WASHINGTON, April 30 (Reuters) – President Barack Obama told jokes at the expense of U.S. real estate mogul Donald Trump on Saturday night, mocking his possible presidential ambitions in remarks at the annual White House Correspondents’ Association dinner.

With Trump and some other potential 2012 presidential election rivals in the audience of celebrities, politicians and journalists, Obama suggested that the weightiest decisions Trump makes are firing people on his reality television show “Celebrity Apprentice.”

“I think we all know about your credentials and breadth of experience,” he said of Trump, drawing laughs.

Obama singled out a recent episode of “Celebrity Apprentice,” in which Trump fired a contender in one of his trademark televised business challenges.

“These are the kinds of issues that would keep me up at night,” Obama deadpanned. “Well handled, sir, well handled.”

“Say what you want about Mr. Trump,” the president added. “He certainly would bring change to the White House.”

Big video screens then showed an image of what was labeled “Trump, The White House.” The mock-up showed bikini-clad girls frolicking in a fountain on the White House front lawn.