Well, I don’t think it was the best decision. But it has a bit of a tradition in the UK, hasn’t it ?
Remember when the sea Harriers had been retired ? From my perspective not the best idea either, to scrap the most capable version of the jet.
I think Distiller is right, the Tornado fleet had been a better idea. The airforce still has the Tiffy, but naval aviation is the loser of this “review”.
Nimrods, the Harriers, the Ark.
For an Island nation as the UK, a strange decision from my perspective. Especially if the UK still tries to be a leader in naval capabilities within Europe. *shrug*

What’s wrong with new build F-16 ? DSI has already been testet, AESA upgrades are available and the latest engines are excellent.
The aircraft is dirt cheap, and adding some of the “stealthy” external weapon containers as planned for the F-18 aren’t really magic.

I think it would add a good amount of weight and reduce the aerodynamic efficiency of the intake if you try to hide the pegasus- not the best thing for an VSTOL aircraft.
Nethertheless I would love a Harrier with DSI, one-piece canopy, diamond wing and V-tail. 😀

And what exactly leads you to believe the Australian order for F-35A helps to guesstimate the costs of the British F-35B ?

Why should Tiffy win ? No AESA, not carrier capable plus Italy and The UK already defected into the JSF camp.

There is a problem with your calculation. Canadians didn’t buy B models. The -B will be by far the most expansive.
One compromise could be to switch to the F-35C and fit cats to the carriers.

I have quite a different view on the topic.

The only two aircraft that really fit the bill are the Rafale and Shornet.

Both can be operated from the next Indian carrier.

Both improve overall fleet efficiency with their jamming capabilities like no other contender.

Both fulfill the self-escorting strikefighter role like no other contender.

Both have armed forces behind them that are actually commited to further development. (Maybe Gripen can compete here)

Who wins in the end depends on tech transfer and the quality of the offered Growler light in my opinion.

Personal choice would be Rafale. Integrated with cheap US PGM’s + French weaponry as alternative choice + commonality with M2K at least weapons wise.

I’m not talking about existing tech. I’m talking about man(brain-)power.
EADS and Saab have a big question mark after Gripen and Typhoon.
EADS even more so, Saab is at least involved in Neuron.
And there are still aircraft to replace. For example, in the timeframe 2020-2025 Germany has to replace 68 Tornados. And there is no domestic programme for a 5th generation ground pounder.
Belgium has yet to decide which aircraft will replace their F-16. Finnland may not be that firm in the JSF camp, either.
There are opportunities for an affordable 5th generation multirole jet.

Europe lacks the interest to develop an own 5th gen. airframe. And those engineers that work now on the Eurocanards will need a job.
Brainpower at fire sale prices.