(AAP Image/Tracey Nearmy) NO ARCHIVING
(AAP Image/Tracey Nearmy) NO ARCHIVING

No compensation for $85m dud fighter jet

Australia will receive no compensation after it was forced to shelve an $85 million fighter jet destroyed by a mechanical fault, an estimates committee has been told.

Defence bosses have said the dud aeroplane was purchased through the United States Navy and the contract didn't allow compensation.

Defence official Tony Fraser says the incident over the EA-18G Growler fighter jet had been a "difficult lesson".

But he also warned that a similar contract arrangement hangs over the Joint Strike Fighter jet program, which is also facing performance concerns.

The Growler jet caught fire in the US during a training exercise in 2018 with Defence later scrapping it from service.

Meanwhile, the committee was also told there was "wriggle room" on the projected 5200 jobs to come from the latest fleet-building.

Defence bosses concede a major shipbuilding project may not generate nearly as many jobs as first expected.

They have also confirmed a new fleet of submarines is unlikely to be ready on time, but rejected suggestions the vessels will be obsolete by the time they are finished.

When repeatedly pressed about whether constructing the offshore patrol boats and submarines would deliver 5200 as promised, Navy official Peter Chesworth said the project was dynamic and fluid.

"Speaking as a bureaucrat there's a little bit of wriggle room in there," Mr Chesworth told a Senate committee on Friday.

Defence heads also said there was a high risk the new submarines would not be ready by the early 2030s.

But Defence Industry Minister Linda Reynolds denied the subs would be technologically obsolete by the time they hit the water.

Senator Reynolds said money had been set aside to upgrade the new Collins Class submarines, if and when such works were required.