27 July 2022
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Nicole Brangwin and David Watt
Foreign Affairs, Defence and Security
Parliament’s consideration of defence
The Defence portfolio is extensive, comprising
a range of activities and issues such as military exercises and operations; peacekeeping;
defence planning and funding; force structure and posture; military-to-military
and civil-to-military relationships; strategic policy; international and
military law; international and domestic agreements; capability acquisitions,
sustainment and disposal; bases, facilities and training areas in Australia and
overseas; remediation of contamination at bases, facilities and training areas;
personnel issues such as recruitment and retention, honours and awards, housing,
pay and conditions, physical and mental health and wellbeing support; and
military history, to name a few.
The purpose of this quick guide is to
provide the new Parliament with an overview of some (not all) of the key
activities and issues relating to the Australian
Australian Government funding to the
Department of Defence and the Australian Signals Directorate for the 2022–23
financial year is $48.6 billion. The 2016
Defence white paper set a
10-year funding model for Defence totalling around $447.6 billion, of which
$195 billion would be allocated to defence capabilities (pp. 177–183).
Defence strategic update (DSU) reaffirmed and adjusted the 10-year
funding model to 2029–30 at a total cost of $575 billion, of which $270 billion
would be invested in defence capabilities (pp. 53–56).
In the lead-up to the 2022 federal election, the Australian
Labor Party (ALP) confirmed its support for the funding and
capability strategies outlined in the DSU and promised to ‘ensure that Defence
has the resources it needs to defend Australia and deter potential aggressors’.
An ongoing commitment to maintaining previous government funding on procuring defence
capabilities was reaffirmed
by the Albanese Government in July 2022.
In Budget strategy and outlook: budget paper no. 1 of the 2022–23 Budget, the Morrison Government allocated Defence’s
share of government expenses by function at 6.1% of the total Budget (p. 143).
Defence funding as a percentage
of GDP (gross domestic product) is often used in public debate as a measure of the
adequacy of the defence budget. However, the 2020
Defence strategic update abandoned the use of defence funding as a
proportion of GDP noting:
The Defence Budget has been decoupled from
GDP forecasts to avoid the need for adjusting Defence’s plans in response to
future fluctuations in GDP.
In his analysis
of the 2022–23 Defence Budget, the Australian Strategic Policy Institute’s
(ASPI) Marcus Hellyer commented on Defence funding as a proportion of GDP:
For those interested in spending as a
percentage of GDP, it’s 2.11% based on the government’s GDP predictions. Of
course, using GDP to measure defence spending is a crude tool; 2021–22’s
defence budget started off at 2.09% but is now a hair below 2.0% at 1.98%
because GDP has recovered so strongly, not because the government didn’t
deliver its funding commitment.
With its long-term capital
equipment purchases, Defence needs more certainty about its funding than a
percentage of fluctuating GDP would allow. While government funding to Defence
is far from the largest area of federal funding, Budget
paper no. 1 shows that Defence’s share of net capital investment is the
largest in the Commonwealth (p. 177). Managing such a large capital program
presents Defence with particular challenges and some of these are dealt with
More detailed information can
be found in The
cost of Defence: ASPI Defence budget brief 2022–23 and the ‘Defence
overview’ in the Parliamentary Library’s Budget review 2022–23.
Permanent uniformed personnel
On 10 March 2022 the Morrison Government announced the permanent Australian Defence Force (ADF) workforce would expand
by 30% to almost 80,000 personnel by 2040. This announcement centred on the
premise that significantly more personnel would be needed to operate new
capabilities, platforms and equipment. The ALP in Opposition agreed with the increase, but questioned how it might be achieved given the challenges faced
by Defence in recruiting and retaining personnel. The
ALP pledged, as part of the 2022 election campaign,
to ‘conduct a comprehensive review’ of ADF ‘recruitment and retention
mechanisms’ with the aim of growing the ADF workforce.
The planned workforce allocation outlined in the
Morrison Government’s 2022–23 Defence budget anticipates a steady increase in the authorised strength of the ADF
workforce from 60,330 personnel in 2020–21 to 64,532 personnel by 2025–26. Figure
1 illustrates the trajectory of the ADF’s workforce from 2012 into the forward
estimates based on average funded strength figures.
Figure 1 Permanent
ADF workforce from 2012–13 to forward estimates
Source: Defence annual reports from 2012–13 to 2020–21 and Portfolio budget statements 2022–23:
budget related paper no. 1.3A: Defence portfolio.
Figure 2 shows the breakdown by service of the
permanent ADF workforce from 2012 into the forward estimates based on the
average funded strength. The Royal Australian Air Force (RAAF) is expected to
increase its permanent workforce by more than 9.2% over the next 4 years, the
Royal Australian Navy (RAN) by approximately 7.3% and the Army by 7.3%. There has
been a steady increase of personnel numbers by service over the last 10 years,
which is expected to continue with the anticipated increases into the forward
Figure 2 Permanent
ADF personnel by service from 2012–13 to forward estimates
Defence annual reports from 2012–13 to 2020–21 and Portfolio budget statements 2022–23:
budget related paper no. 1.3A: Defence portfolio.
Initial workforce growth figures in the 2020 Force structure plan indicated the
RAN was expected to grow by 650 personnel by 2024, the Army by a modest 50
personnel and the RAAF by 100. In 2020–21 Defence
was developing a new Defence strategic workforce plan (DSWP) for
consideration by the Government in 2021. The DSWP was expected to be released
in late 2021 and include plans to continue growing the workforce between the
years 2024 and 2040. The Defence budget 2022–23 acknowledged the DSWP had
been developed (p. 17) but not publicly released (possibly being revised in
light of recent capability announcements and now a new government).
Reservists have been called out in greater numbers over the last few years and as such, the Reserve force numbers
might see an increase of around 8% (from an estimated actual of 20,773
personnel in 2021–22 to 22,440 personnel by 2025–26, with the Army to receive
ADF recruitment and separations
Attracting the right people in
sufficient numbers to the ADF has always been a challenge but the ADF has
managed to reach its recruiting targets by around 90%
over the last few years. A greater challenge is retaining skilled personnel,
particularly in critical employment categories. One of the key
employment categories is the RAN’s submarine workforce, which for many years
struggled to recruit and retain personnel. In 2016, as a measure to increase
the submarine workforce, the RAN issued the Submarine Deliberately
Differentiated Package (see the section on the Submarine capability assurance payment in the ADF Pay and Conditions Manual (PACMAN)). The package, which considerably improved the RAN’s submarine workforce, was the
first of its type to be used by the ADF and was expected to provide a model for
future workforce challenges.
While the submarine workforce is expected to continue growing, the
cancellation of the Attack Class submarine program in favour of a (yet to be
determined) nuclear-powered submarine fleet under the AUKUS agreement will
require a very different workforce plan. The skill sets required for operating
a nuclear-powered capability are significantly different to those of the
existing conventional submarine workforce. This will be one of the many
challenges considered by the Nuclear Powered Submarine Taskforce.
Figure 3 provides a broad overview of ADF recruitment
and separations over the last 10 years. The table indicates that, in most
years, the ADF recruited slightly more personnel than it lost.
Figure 3 ADF
permanent force recruitment and separations
Source: Defence annual reports from 2012–13 to 2020–21.
Defence’s civilian workforce
Defence’s civilian workforce has
seen a steady decline over the last decade. In 2012–13 the Department of
Defence employed 21,534 full-time equivalent (FTE) Australian Public Service
(APS) staff. By 2020–21 this number had decreased by 23.6% to 16,454 FTE APS
staff. The Morrison Government’s 10 March 2022 announcement to increase Defence’s workforce implicitly included the APS – ‘Defence’s
total permanent workforce will increase to over 101,000 by 2040’. The 2022–23
Defence budget included a minimal increase of around 5.9% over the forward
estimates (from an estimated actual of 16,001 staff in 2021–22 to 16,946 FTE
APS staff by 2025–26). By 2040 the APS workforce could potentially reach 2012
figures of close to 21,000 FTE staff. Figure 4 highlights the decline in APS
staff since 2012 and the relative levelling out since 2018–19.
Figure 4 Australian
Public Service full-time equivalent workforce totals from 2012 to 2026
Source: Defence annual reports from 2012–13 to 202–21 and Portfolio budget statements
2022-23: budget related paper no. 1.3A: Defence portfolio.
Figure 5 shows the available figures for Defence’s APS
recruitment since 2012 and the (mostly) higher rates of separation.
Figure 5 Department
of Defence APS recruitment and separations
Source: Defence annual reports from 2012–13 to 2020–21.
Prior to the 2022 election the ALP expressed concern
over the ‘high rate of separations from the ADF’ and committed to conducting a comprehensive review of ADF ‘recruitment and retention mechanisms’ such as ‘pay and
conditions, housing and health assistance’. Combined with Defence’s reduced APS
workforce, Defence has seen a greater reliance on its external workforce to
ensure major capabilities are delivered.
Defence categorises its external workforce as consultants, contractors and outsourced service providers, with
the latter making up the largest proportion of workers (p. 28). Typically,
consultants are contracted to Defence for specific expertise and independent
advice to produce a report or product. Contractors tend to be specialists in
fields such as information and communications technology (ICT; excluding
helpdesk, as this function is done by an outsourced service provider), and
project management, working under the general direction of Defence. Outsourced
service providers include garrison health and base support, ADF recruitment
(which is currently contracted to ManpowerGroup) and
submarine maintenance, just to name a few.
Table 1 includes the yearly breakdown of Defence’s
expanding external workforce, based on Defence’s census data. As noted by ASPI’s Marcus
Hellyer in the 2022–23 Cost of Defence publication,
‘contractors alone are equal to nearly 50% of Defence’s APS workforce’
and are considered Defence’s largest ‘service’ given the size of the workforce
Table 1 Department
of Defence external workforce
|| July 2019
|| March 2020
|| March 2021
|| March 2022
|Outsourced service providers
Source: Marcus Hellyer, The cost of Defence: ASPI
Defence budget brief 2022–23, (Canberra: Australian Strategic Policy Institute, June 2022), 50.
The most recent Defence annual report
included a breakdown of costs and contract figures for the external workforce,
which included outsourced service providers (pp. 274–75). In 2020–21 there was
a total of 584 (new and ongoing) consultancy contracts worth around $127.4
million. The top 5 consultancy companies were KPMG, PricewaterhouseCoopers,
GHD, AECOM, and Ernst & Young. In the same period there were a total of
34,719 non-consultancy contracts (new and ongoing) worth more than $27 billion.
The top 5 non-consultancy contractors were Thales, Boeing, BAE Systems, Ventia
Five years ago a large proportion of Australia’s deployed military
forces were stationed in the Middle East as part of multinational efforts to
conduct counter-piracy, counter-terrorism and maritime security operations, such
as Operation Manitou and air combat operations in
Iraq and Syria, as well as special operations and army training in Iraq as part
of Operation Okra. By 2020 the ADF’s focus had shifted to Australia’s
immediate region as Middle East deployments were drawn down to minimal
contributions, and in June 2021 the ADF completely withdrew
the last of its personnel from Afghanistan.
The Morrison Government’s 2020 Defence strategic update emphasised
that this shift was due to the region around Australia becoming ‘more
competitive and contested’ and as a consequence, defence planning needed to
focus on Australia’s ‘immediate region: ranging from the north-eastern Indian
Ocean, through maritime and mainland South East Asia to Papua New Guinea and
the South West Pacific’ (p. 6). The diverse range of the ADF’s capabilities and
the work of its personnel is demonstrated by the varied nature of operational
activities shown below.
There are a number of ongoing ADF operations in the Southwest
Pacific and Pacific regions:
Solania – the ADF’s contribution to multinational activities under the
Quadrilateral Defence Coordinating Group (Australia, France, New Zealand and
the US) arrangements to provide maritime surveillance in the Pacific. Solania
also supports other regional operations under the Pacific Island Forum
Fisheries Agency (FFA) efforts to ‘detect and deter’ illegal, unregulated and
unreported fishing activity using RAN vessels and RAAF maritime surveillance
Render Safe – involves RAN and Army explosive ordnance specialists,
supported by hydrographic and amphibious ships and aircraft, ‘safely disposing
of World War II-vintage explosive remnants of war’ from Pacific Island nations.
Regional Engagement in the Southwest Pacific – involves the ADF increasing
its presence in Pacific Island nations through activities such as combined
operations, training and exercising with Pacific Island military forces and security
In the Indo-Pacific:
Gateway – a joint RAAF and Royal Malaysian Air Force (RMAF) operation
since 1981 that involves maritime surveillance patrols in the North
Indian Ocean and South China Sea conducted out of
Endeavour – an annual RAN-led activity since 2017 (except for 2020 due to
COVID-19 restrictions) that, at times, involved up to 1,200 personnel from all
3 services. Operating from RAN vessels in different locations each year, IPE engages
in bilateral and multilateral training and capacity building with Indo-Pacific nations
and has been described as
The ADF’s presence in Asia involves:
Argos – a maritime surveillance (RAN vessels and RAAF maritime surveillance
aircraft) operation to ensure UN sanctions are
enforced against the Democratic People’s Republic of Korea (DPRK; North Korea).
A small number of ADF personnel are also deployed to the Korean Peninsula under
to assist UN Command with ‘monitoring of Comprehensive Military Agreement
activities within the Demilitarised Zone’.
Augury Global – the operational name for ADF activities countering terrorism
and violent extremism – as was the case in 2017 when the ADF provided
assistance to the Philippine Government fighting Daesh-aligned militants in
1 December 2019 Operation Augury Philippines transitioned to an Enhanced
Defence Cooperation Program. At present, around 40 ADF personnel are stationed
in the Middle East under Operation Augury.
The ADF still operates outside the Indo-Pacific contributing
to ongoing operations such as Manitou and Accordion,
peacekeeping efforts in Africa such as Aslan (South
Sudan) and Mazurka
(Egypt), and peacetime activities in the Antarctic under Operation
On 24 February 2022 the
Russian Federation invaded Ukraine. The invasion was condemned by the international community,
including Australia. The ADF has not deployed any
personnel to the conflict, but, like many allied nations, has sent military
equipment to support the Ukrainian Government’s defence against Russia. To date
around A$285 million in ‘defensive military assistance’ has been provided to the Ukrainian Government, including:
Sections within the Department
of Defence that facilitated this assistance included the Australian Defence
Export Office (ADEO), Defence Export Controls (DEC; which is separate to ADEO),
and the International Policy Division and Capability Acquisition and
Sustainment Group (CASG), which suggests appropriate oversight of arms transfer
requirements and export controls under Australia’s treaty obligations. The ALP
in Opposition supported all measures taken by the Morrison Government in
response to the Ukrainian Government’s requests for assistance.
Prime Minister Albanese visited the Ukrainian capital Kyiv on 3
July 2022 to meet with President Volodymyr Zelenskyy. During the meeting,
the Prime Minister offered further military assistance in the form of:
- A$99.5 million in military assistance, including 14 armoured
personnel carriers, 20 Bushmaster protected mobility vehicles and other
military equipment supplied by Australia’s defence industry, and a contribution
to NATO’s Ukraine Comprehensive Assistance Package Trust Fund. This brings
Australia’s total military assistance to Ukraine to approximately
A$8.7 million (US$6 million) to assist Ukraine’s Border Guard
Service to upgrade border management equipment, improve cyber security and
enhance border operations in the field.
Duty free access for Ukrainian imports to Australia,
complementing similar trade measures taken by our partners, including the UK
and the EU.
Australia will intervene at the International Court of Justice in
support of Ukraine in its case against Russia.
Targeted financial sanctions and travel bans on 16 additional
Russian ministers and oligarchs.
Australia will prohibit imports of Russian gold to reduce
Russia’s ability to fund its war, joining with partners, including Canada,
Japan, the United Kingdom and United States.
This brings Australia’s total
contribution to A$385 million.
The US-led Ukraine Contact Group met for the first
time on 23 May 2022 to discuss continued military aid to Ukraine. The meeting
included military chiefs from 44 nations. It is unclear if Australia was
represented at that meeting, but US Defense Secretary Austin noted Australia’s
contribution of howitzers to Ukraine.
By the time the third
meeting was held on 15 June 2022 the membership had grown to almost 50
nations. The Ukrainian Government continues to receive an increasing amount of sophisticated
weaponry from many of these nations, but without proper training this
high-tech equipment can be a burden. Quoted in a recent New
York Times article, an Armed Forces of Ukraine (AFU) soldier described
the situation: ‘“It’s like being given an iPhone 13 and only being able to make
phone calls”’. The NYT reported that soldiers are using Google Translate to
read instruction manuals and watching online videos to learn how to use some complex
weapons systems. However, since the Russian annexation of Crimea
in 2014 a large proportion of AFU personnel received
combat training from the US and other NATO militaries, which included
instruction on how to use US and NATO weapons systems. In February 2022 this
training moved from Yavoriv, Ukraine to Grafenwoehr, Germany. Small
groups of AFU personnel continue to receive more streamlined training in
Germany and other NATO countries and once proficient in the use of the new
systems, return to Ukraine to train others on the equipment.
The collapse of Afghanistan’s
Following the complete
withdrawal of foreign military forces from Afghanistan (all Australian
military personnel and equipment had withdrawn by June 2021) the Taliban took
control of the Afghan capital Kabul on 16 August 2021 without any resistance
from the Afghan National Defense and Security Forces (ANDSF). Many questions
were raised about the swift collapse of the ANDSF, despite the billions of
dollars spent training and arming ANDSF personnel over the last 20 years. The US
Special Inspector General for Afghanistan Reconstruction (SIGAR) was tasked with
the job of explaining why the ANDSF disbanded so easily.
In May 2022 SIGAR released an
interim report stating:
SIGAR found that the single most important factor in the
ANDSF’s collapse in August 2021 was the U.S. decision to withdraw military
forces and contractors from Afghanistan through signing the U.S.-Taliban
agreement in February 2020 under the Trump administration, followed by President
Biden’s withdrawal announcement in April 2021. Due to the ANDSF’s dependency on
U.S. military forces, these events destroyed ANDSF morale. The ANDSF had long
relied on the U.S. military’s presence to protect against large-scale ANDSF
losses, and Afghan troops saw the United States as a means of holding their
government accountable for paying their salaries. The U.S.-Taliban agreement
made it clear that this was no longer the case, resulting in a sense of
abandonment within the ANDSF and the Afghan population. The agreement set in
motion a series of events crucial to understanding the ANDSF’s collapse (p. i).
SIGAR’s final report is scheduled for release around
Security Council continues to monitor the deteriorating situation in
Afghanistan – human rights for women and girls, the worsening humanitarian and
economic crisis and an increase in terrorist activities – and updates the
mandate for the UN Assistance Mission in
Afghanistan (UNAMA). The Afghan affiliate of Daesh, known as the Islamic
State in Khorasan Province (ISIS-K), continue its attacks in Afghanistan, most
50 people in a Kabul mosque. Skirmishes on the Afghan–Pakistan border have
also caused security concerns, coupled with reports the insurgency against the
Taliban from the National
Resistance Front of Afghanistan is building momentum in the Panjshir
province of northern Afghanistan.
March 2022 the head of US Central Command (US CENTCOM) warned the Senate
Armed Services Committee that without sustained counter-terrorism activities in
Afghanistan, violent extremist organisations (VEO) like ISIS-K ‘could establish
an external attack capability against the United States and our allies in
twelve to eighteen months, but possibly sooner if the group experiences
unanticipated gains in Afghanistan’ (p. 9). The use of the US’s ‘over the
horizon’ counter-terrorism capabilities in Afghanistan ‘remains difficult, but
not impossible’. However, since the US military withdrawal, large gaps exist in
intelligence collection, effectively limiting the US’s ability to target VEOs in
Afghanistan (pp. 9–11).
Similarly, the report
from the US Lead Inspector-General on Operation Enduring Sentinel warned:
Since the withdrawal of U.S. military forces from Afghanistan
in August 2021, the DoD has pivoted to an “over-the-horizon” approach to
counterterrorism in that country. Without access to military bases in
neighboring countries, this new approach relies primarily on unmanned aerial
vehicles operating from U.S. facilities in Doha, Qatar, to provide strike
capabilities. As of the end of the quarter, the DoD had not conducted any
strikes on terrorist targets in Afghanistan since its withdrawal last year (p.
If the US CENTCOM’s predictions prove true, this would be a
devastating outcome after the
mission in Afghanistan to degrade terrorist organisations and diminish the
threat of global terrorism.
In recent years, operational deployments not only involved
missions beyond Australia’s borders, but also increasingly within. The national bushfires of 2019–20 saw an
unprecedented number of ADF personnel and equipment supporting civilian
emergency services under Operation Bushfire Assist 2019–20, which lasted almost 6 months. At its peak, the ADF
tasked around 6,500 personnel, including 3,000 reservists under compulsory call-out orders. This was the first
time the Calling out the Reserves powers were used for a national disaster (Defence Act 1903, Division 3 of Part III,
subsection 28). Operation Bushfire Assist 2019–20 was considered the largest-ever
mobilisation of the ADF in response to a domestic disaster. In addition, around
450 military personnel from Canada, Fiji, Indonesia, Japan, New Zealand, Papua
New Guinea, Singapore and the US provided assistance (Defence annual report 2019–20, pp. 18–19;
The October 2020 report released by the Royal
Commission into National Natural Disaster Arrangements (chaired by
former Chief of the Defence Force Mark Binskin) acknowledged the role of the
ADF during the national bushfire disaster but highlighted the general public
perception ‘that the ADF could assist in every aspect and was always readily
available’. The report asserted that this is not the case and it is not ‘a
reasonable expectation of the ADF’ (p. 187). The report summarised:
The primary role of the Australian Defence Force (ADF) is
defending and protecting Australia. Although not its primary role, the ADF
provides assistance, to the benefit of the nation, through its capabilities and
resources during and after natural disasters. In some cases, ADF assistance is
significant, such as during, and in the aftermath of, the 2019-2020 bushfires.
There appears to be a lack of understanding about the role,
capacity and capability of the ADF in relation to natural disasters. The ADF
does not have the capacity or capability to fight bushfires. It does, however,
have unique capabilities to provide ancillary support. Understanding of ADF
capabilities and processes needs to be improved to ensure that it is used
effectively (p. 186).
The royal commission made 3 recommendations about the role
of the ADF in responding to national natural disasters, including improving
understanding of the ADF’s capabilities, a more consistent approach for ADF
assistance processes in emergency planning guidelines, and ensuring legal
protections for ADF members while conducting disaster response activities.
Immediately following the national bushfire disaster
response the ADF was called on to assist with the COVID-19 pandemic. The ADF has been assisting
federal and state and territory governments since March 2020 under Operation COVID-19 Assist.
Both the bushfire and COVID-19 assistance operations were
conducted under Defence Assistance to the Civil Community (DACC)
arrangements (also see National emergency and disaster response arrangements in
Australia: a quick guide). The Department of Defence updated and
released the DACC Manual in August 2020. According to the Defence annual report 2020–21 the
manual was updated ‘to better align Defence with a proactive, integrated
whole-of-government approach to planning, preparing for, and responding to
natural disasters’ (p. 27).
The ADF continues to contribute around 600 personnel from
all 3 services to Operation Resolute as part of the
whole-of-government border protection efforts. ADF assets from all 3 services,
along with Australian Border Force (ABF), ‘conduct civil maritime security
operations’ in relation to illegal maritime arrivals; maritime terrorism;
piracy; robbery and violence at sea; and biosecurity (ensuring there is no
illegal activity or exploitation of protected areas and natural resources).
The recently identified Operation Dyurra involves the ADF’s space
operations in support of broader military operations. Dyurra has been
integrated with the US-led Operation Olympic Defender, which also involves
Canada, France, Germany, New Zealand and the UK. The US Department of Defense describes the purpose of
Olympic Defender as being ‘to strengthen deterrence against potentially hostile
actors in space and prevent the spread of debris in space’.
The principal method by which the
Australian Government sets out Defence policy to the Australian people is by
the publication of Defence white papers. These
have been published in 1976, 1987, 1994, 2000, 2009 and 2013, but the most recent Defence white paper
was published during 2016 and updated in the 2020 Defence strategic update. The DSU was accompanied by the 2020
Force structure plan, which set out the new and adjusted capability
investments necessary to implement defence planning under the DSU.
The 2020 DSU is therefore the most recent statement
of the Australian Government’s view of Australia’s strategic situation and military
requirements. This statement was delivered with what the Australian Strategic Policy Institute called a ‘new directness’. The DSU is certainly blunt:
Our region is in the midst of the most consequential
strategic realignment since the Second World War, and trends including military
modernisation, technological disruption and the risk of state-on-state conflict
are further complicating our nation’s strategic circumstances (p. 3).
It further states that ‘strategic
competition, primarily between the United States and China, will be the
principal driver of strategic dynamics in our region’ and notes the growth of
great power assertiveness ‘including China’s active pursuit of greater
influence in the Indo-Pacific’ (p. 11). The war in Ukraine, while not in
Australia’s region, has reinforced the sense that the global strategic environment
is destabilising, and that Australia must be prepared for potential conflict.
The DSU articulates a further concern that relates to its
assessment of the strategic situation:
Previous Defence planning has assumed a
ten-year strategic warning time for a major conventional attack against
Australia. This is no longer an appropriate basis for defence planning.
Coercion, competition and grey-zone activities directly or indirectly targeting
Australian interests are occurring now. Growing regional military capabilities,
and the speed at which they can be deployed, mean Australia can no longer rely
on a timely warning ahead of conflict occurring (p. 14).
As International Institute for
Strategic Studies (IISS) Shangri-La Dialogue Senior Fellow Euan Graham wrote when the DSU was
There is a seriousness and urgency to these documents,
underlined by the abandoning of a ten-year ‘strategic warning time’ that
hitherto served as the basis for Australia’s defence planning. The defence
force that emerges as a result of these adjustments may be the one that
Australia has to go to war with.
The DSU emphasised that the changing ‘nature of current and
future threats – including coercion in the region, more capable and active
regional military forces, and expanding anti-access and area denial
capabilities – requires Defence to develop a different set of capabilities’ (p.
27). These capabilities will include longer range strike
weapons and increased cyber capabilities (the 2022–23 Budget included significant additional funding for offensive cyber capabilities) and area-denial systems. The
DSU also stated the need to increase the ADF’s ‘self-reliant ability to deploy
and deliver combat power and reduce its dependencies on partners for critical
capability’. This would be achieved by increasing the type and quantity of
weapons stocks held by the ADF while also investing in other measures such as
‘sovereign manufacturing capabilities for advanced guided weapons and explosive
ordnance and expanding ADF fuel storage capacity’ (p. 40).
As noted above in the section on
operations, the ADF’s operational activities focus on Australia’s ‘immediate
region’. Manifestly, this is a very large region and the DSU stresses
the need for defence planning to expand regional cooperation to help ensure
that Australia’s access to the region is not constrained (p. 26). To assist
with defence planning, the new Albanese Government is expected
to conduct a Defence Force Posture Review designed to:
the Australian Government is considering both long-term strategic posture, and
whether Australian defence units, assets and facilities are prepared for the
military to take action in a timely way amid a deteriorating strategic
The last force posture review was completed
by Allan Hawke and Ric Smith in 2012 in the
lead-up to the Gillard Government’s 2013 Defence white paper. A force
posture review involves a strategic assessment of the geographic
positioning of Australia’s Defence. This is a separate process
to a force structure review, which is undertaken within the Department of
Defence as a force design tool to align strategy, resources and capability with
future force requirements. The outcomes of force structure reviews are usually
not published; however, the 2020 Force structure plan provides an
example of how force design is translated into policy. Other
relevant Turnbull–Morrison Government era defence policy documents include:
While there is
yet to be a public announcement about the commissioning of the Force Posture
Review and who will lead it, the Albanese Government has stated that the
outcome of the review is expected to be delivered in early 2023.
On 16 September 2021 the leaders of
Australia, the UK and the US announced the formation of ‘an enhanced trilateral
security partnership called “AUKUS”’. There are 2 streams of work under AUKUS.
The first is the acquisition of 8 nuclear-powered (not nuclear armed) submarines for the Royal Australian Navy (RAN) – an announcement that effectively
cancelled the Attack Class submarine program with Naval Group (France).
In making the announcement, Prime Minister
Scott Morrison stressed that Australia was not seeking to acquire nuclear
weapons nor establish a civil nuclear industry, and would continue to meet its nuclear non-proliferation obligations. Mr
Morrison also stated that the nuclear-powered submarines are expected to be
built in South Australia ‘within the decade’.
The second stream of work relates to
advanced capabilities, including:
- advanced cyber capabilities
- artificial intelligence and autonomy
- quantum technologies
- undersea capabilities.
In September 2021 the Nuclear Powered Submarine Taskforce (NPST)
was established to identify ‘the optimal pathway’ for Australia’s acquisition
of 8 nuclear-powered submarines over a period of 18 months (March 2023).
The NPST involves specialists from multiple agencies: the Department of Defence;
Department of Foreign Affairs and Trade; Attorney-General’s; the Department of
Education, Skills and Employment; the Australian Nuclear Science and Technology
Organisation (ANSTO) and the Australian Radiation Protection and Nuclear Safety
AUKUS is not a security alliance in the
same vein as ANZUS, nor is it a partnership
like the Quadrilateral Security Dialogue (the
Quad; involving Australia, India, Japan and the US). ASPI’s Michael Shoebridge described it as a ‘trilateral
technology accelerator between the governments of the three nations with a
ruthless focus on increasing the military power of each of our militaries…’ for
the purpose of national security (p. 4).
AUKUS is very much in its earliest stages. On 8 February 2022,
of Naval Nuclear Propulsion Information Agreement (ENNPIA) came into force
allowing trilateral information-sharing on nuclear propulsion. The ENNPIA
allows Australian personnel to receive training from UK and US counterparts
on building, operating and supporting nuclear-powered submarines. The Joint
Standing Committee on Treaties (JSCOT) supported
Australia’s ratification of the ENNPIA and is expected to review subsequent
On 7 March 2022 the Morrison
Government announced that in order to support the nuclear-powered submarines,
a new submarine base would be established on Australia’s east coast (this would
be in addition to the RAN’s existing submarine homeport at HMAS Stirling in WA).
Out of 19 potential sites reviewed by the Department of Defence, 3 were
identified as preferred locations: Brisbane, Newcastle and Port Kembla. These
locations were determined based on ‘access to exercise operating areas,
proximity to industrial infrastructure, and significant population centres to
support personnel and recruitment’. A deadline of the end of 2023 was established
for ‘initial work’ to be completed.
fact sheet released in April 2022, following the AUKUS
leaders-level meeting, noted progress on the implementation of AUKUS and the
inclusion of 4 additional areas in the advanced capabilities stream: hypersonic
and counter-hypersonic capabilities; electronic warfare; innovation; and
information sharing. As the trilateral
partnership matures it is anticipated that ‘allies and close partners’ will
be engaged as appropriate.
Speaking at the Shangri-La Dialogue in Singapore on 11 June
2022, the new Minister for Defence Richard
Marles reaffirmed the Albanese Government’s commitment to AUKUS:
AUKUS – which Labor supported in Opposition
– will be central. It will not only deliver nuclear-powered submarines for
Australia, but also guide accelerated development of advanced defence
capabilities where they have most impact, such as quantum technology,
artificial intelligence, undersea warfare, hypersonics and counter-hypersonics.
Until the work of the NPST is completed it is difficult to
predict the potential costs of the nuclear-powered submarine program. ASPI
has calculated an out-turned cost of between $116 billion and $129 billion for
the ‘most efficient build’ option to between $153 billion and $171 billion for
a drawn-out process that includes ‘a continuous build cycle’. However, ASPI
caveats these figures by emphasising this is ‘assumption-rich territory’ (p.
One other ramification of Australia’s
decision to acquire nuclear-powered submarines will be the need to grow, from a
very low base, a workforce with the necessary nuclear science expertise and
engineering skills to operate and maintain nuclear technology. As a step down
this path the Morrison Government announced in December
2021 the creation of more than 300 Defence Nuclear Science and
Engineering Scholarships over the next 5 years.
The new Government has also promised to
create the Australian Strategic Research Agency (ASRA)
to ‘boost Australia’s involvement in technology sharing and research and
development’ under AUKUS. The proposed ASRA would be modelled on the US’s Defense
Advanced Research Projects Agency (DARPA).
Decisions around Defence capability follow Defence’s capability
policy framework (pp. 1–2). The Defence
Capability Manual describes the One Defence Capability System (formerly
known as the Defence capability life cycle) which involves four phases that
‘connect Government’s priorities through to prepared forces that are available
to be committed to operations. At any point in time, individual capabilities
will be at different stages of maturity across the four phases’ (p. 5).
Figure 6 illustrates the four phases of the One defence
capability system (ODCS).
Figure 6 One defence capability system
Source: Department of
Defence (Defence), Defence capability manual, (Canberra: Defence, 3 December 2021), 6.
Details of all 4 phases and areas of responsibility are
outlined in the Defence
capability manual. Capability proposals are usually subjected to a
rigorous process (including contestability) involving key decision gates by
the Investment Committee and consideration by government, known as passes (pp.
Gate 0 involves consideration of a business case by the
Investment Committee for a proposed capability. If approved, the proposal progresses
to the next gate, or in some cases, is accelerated to gate 2.
Gate 1 develops a more detailed proposal, which is again
considered by the Investment Committee. If approved, the committee recommends the
proposal proceeds to government for consideration. If the proposal is approved
by government (known as First Pass approval) the proposal will progress
to Gate 2. First Pass approval of a Gate 1 proposal does not commit the
government to acquire a specific capability, but allows for further
investigation to progress the proposal to Gate 2, along with any
recommendations from government.
A Gate 2 proposal includes detailed planning and
capability requirements, such as whole-of-life cost and schedule estimates, risk
assessments, workforce planning, and Australian industry participation. The
Investment Committee considers the detailed proposal, which will either be
recommended for government consideration and approval (known as Second Pass
approval) or referred back to the action area for further refinement. Second
Pass approval provides Defence with the approval to commence an acquisition
Some projects that are considered low risk might bypass the
First Pass approval stage and progress directly to Second Pass – commonly referred
to as Combined Pass (p. 41).
Defence project funding is incorporated into Defence’s
Portfolio budget statements for approval
by the Parliament through the appropriations process. The progress of some
of Defence’s most expensive equipment acquisition projects is regularly assessed
by the Australian National Audit Office. Each year since 2007–08 the ANAO has
produced a major project report (MPR) following a performance audit of a select
number of Defence’s major equipment acquisitions. The most
recent MPR was published in December 2021 and included 21 major projects
worth $58 billion in total. The MPRs are reviewed by the Joint
Committee of Public Accounts and Audit (JCPAA). The Senate
Estimates process also provides the Parliament with an opportunity to question
officials about Defence capabilities.
capability acquisition projects
The following projects have been used to highlight some of
Defence’s major capability projects. This is not a comprehensive list as there
are too many projects to include. As at 30 June 2021 the Capability
Acquisition and Sustainment Group (CASG) within Defence was managing 161 government-approved
major acquisition projects worth $121.6 billion and 109 sustainment products (maintaining
and supporting Defence equipment, systems and platforms) at a cost of around
$7.7 billion (2020–21
Defence annual report, p. 38).
projects are generally categorised by battlespace domain:
- Air includes
air defence systems, early warning and control systems, rotary and fixed-wing aircraft,
over-the-horizon radar and remotely piloted aircraft systems.
includes battle command systems, counter improvised explosive device
capability, aviation and field fire trucks, vehicles and trailers, geospatial
support and weapons.
(maritime) includes naval vessels, weapons and missiles systems and rapid
environment assessment capability.
- Information and cyber capabilities are mostly classified
but include offensive cyber capabilities for the Australian Signals Directorate,
such as project REDSPICE, which
stands for resilience, effects, defence, space, intelligence, cyber and
- Space is still a relatively new domain for Australia (Space Command
was stood up in January 2022 as a joint capability within the RAAF) but the last
Defence budget included one space capability project, which is to protect
military satellite communications (p. 111).
Some capabilities are categorised as Joint, such as mine warfare capabilities; aviation fuel vehicles;
communications and surveillance; and amphibious deployment, while others are minor projects.
There are various acquisition methods available to Defence
for major capability purchases. For instance, Foreign Military Sales (FMS), Direct
Commercial Sales (DCS), government-to-government cooperation agreements and
cooperative programs, just to name a few.
Some examples of recent procurement announcements include:
AGM-88E2 anti-radiation missiles (used to detect and target radio
emission sources) and related equipment for use in the RAAF’s EA-18G Growler
fighter aircraft. The estimated cost is US$94 million with no offsets requested.
Once the FMS is approved by Congress, Northrop Grumman Information Systems will
deliver the capability (21
HIMARS (High Mobility Artillery Rocket Systems) Launchers and
related equipment for the Australian Army at an estimated cost of US$385
million. The prime contractors will be Lockheed Martin in the US, Chelton Inc.
in the UK and L3 Harris Corp. in Australia. Offsets were requested by Australia
three prototype Extra Large Autonomous Undersea Vehicles (XLAUV)
will be designed, developed and manufactured under a co-funded program
involving the RAN, the Defence Science and Technology Group and Anduril
Australia within 3 years (5
Raytheon Australia and Lockheed Martin Australia were announced
as strategic partners for the $1 billion sovereign guided weapons and explosive
ordnance enterprise (5
April 2022) – this is one of 8 defence enterprise programs identified in
the 2020 Force structure plan, p. 82.
- ‘Accelerated acquisition’ of $3.5 billion worth of missile strike
capabilities: Joint Air-to-Surface Standoff Missile Extended Range (JASSM-ER)
for the RAAF’s F/A-18F Super Hornet and ‘in future the F-35A Lightning II’ Joint
Strike Fighter aircraft; Kongsberg’s Naval Strike Missile (NSM) capability will
be installed in the RAN’s Anzac Class frigates and Hobart Class destroyers from
2024; and ‘maritime mines to secure Australia’s ports and maritime approaches’
24 uncrewed aerial surveillance (UAS) systems made by Boeing’s
Insitu Pacific in Queensland for the Australian Army (11
Main Battle Tank Upgrade (LAND 907 Phase 2) and Combat
Engineering Vehicle (LAND 8160 Phase 1) projects for the Australian Army worth $3.5
Self-Propelled Howitzers and Armoured Ammunition Resupply
Vehicles for the Australian Army made by Hanwha Defense Australia (Republic of
Korea), based in Geelong. The contract is worth around $1 billion (13
A large proportion of Defence’s major capability
acquisitions require very long lead times – in some cases years, in other cases
decades. Examples of some of Defence’s top 30 capability acquisition projects are:
Lightning II aircraft are in the process of being acquired via a
Cooperative Partnership with the US Government. So far, 48 aircraft are in
service with the RAAF and are now being managed by CASG as a sustainment
product. A further 15 aircraft are expected in Australia by June 2023 (2022–23
PBS, p. 113). Final Operational Capability for the entire F-35A program (known
6000 Phase 2A/2B) is scheduled for December 2023. The current total
approved budget is $17.5 billion (2022–23
PBS, p. 101). For background on the F-35A program, see the Library’s July
2012 publication, The
Joint Strike Fighter: overview and status.
- Four MC-55A Peregrine (AIR 555 Phase 1) long-range electronic
warfare aircraft, ‘including mission, ground and support systems, and
Australian based facilities’ (18
March 2019). This project is mostly a developmental FMS acquisition through
the US Air Force and is worth around $2.6 billion (2022–23 PBS, p. 102).
Poseidon (AIR 7000 Phase 2) crewed maritime surveillance aircraft and 7 MQ-4C
Triton (AIR 7000 Phase 1B) uncrewed aircraft systems are being procured for
the RAAF under a cooperative program with the US Navy. To date the RAAF has 12
P-8A Poseidons in service with the final 2 expected in 2024–25. Three MQ-4C
Tritons have received Second Pass approval – the next tranches of aircraft and
support systems to be subsequently considered by government. The current total
approved budget for the P-8A is around $6.57 billion and almost $2.5
billion for the Triton (2022–23
PBS, p. 102).
211 combat reconnaissance vehicles (CRV) are being acquired for
the Army under LAND
400 Phase 2 with a total approved budget of around $5.7 billion (2022–23
PBS, p. 106). In
September 2019 Rheinmetall (Germany) was awarded the contract to ‘assemble’
its Boxer CRVs in Australia. The first 25 CRVs were assembled in Germany, with the
remaining vehicles to be assembled at Rheinmetall’s Military Vehicle Centre of
Excellence facility in Redbank, Queensland. Delivery of the first Australian-built
Boxer CRV is expected in 2023–24.
Project Overlander (LAND 121 Phase 4) involves the delivery of 1,098
Protected Mobility Vehicles – Light (Hawkei)
and 1,058 companion trailers. Thales
(France) was awarded the contract in October 2015, with the vehicle design
and build to take place in Bendigo, Victoria. The delivery in tranches of Hawkeis
to Defence commenced
in 2016 and was expected to be completed by the end of 2021. In 2018
two Hawkeis deployed to Iraq on operations. Initial Operational Capability
in July 2021 and Final Operational Capability is scheduled for 2023. This
project has a total approved budget of $1.96 billion (2022–23
PBS, p. 107).
12 Offshore Patrol Vessels (OPV) are being built for the RAN in
Australia under prime
contractor Luerssen (Germany) at Australian shipyards in Osborne, South
Australia and Henderson, Western Australia. The first OPV, NUSHIP Arafura,
on 16 December 2021. The project has a total approved budget of around $4.6
PBS, p. 109).
An immediate consequence of the Morrison Government’s decision
to acquire nuclear-powered submarines as part of the AUKUS agreement was the
cancellation of the Attack Class submarine program.
On 11 June 2022, the Albanese
Government announced it had reached an agreement with Naval Group about the
termination of the Attack Class submarine program. The media release stated
that the agreed settlement amount was approximately A$830 million. This is in
addition to the 2022–23
Defence portfolio budget statement’s estimation of expenditure of A$3.2
For further information about the Attack Class program from
its inception in the 2009 Defence White Paper until 2020, see the Parliamentary
Library’s overview, Managing
SEA 1000: Australia’s Attack class submarines.
The Royal Australian Air Force’s Project
AIR 7003 SkyGuardian, which was first
announced in November 2019, would have provided Defence with remotely
operated strike capability. SkyGuardian was described by Defence as:
… an armed Medium Altitude Long Endurance Remotely Piloted
Aircraft System which will provide Defence with a persistent airborne
Intelligence, Surveillance, Reconnaissance, Electronic Warfare and precision
It was revealed in a 2022 Senate
Estimates hearing that this
project has been cancelled. Currently, defence does not operate an armed remotely
piloted system and the decision to cancel a project that would have resulted in
the acquisition of one was criticised
by some commentators. In response to the criticisms, Defence
The Australian Government has made the hard decision to
prioritise resources in response to the complex and challenging strategic environment
While the MQ-9B SkyGuardian provides an excellent capability
system, tough decisions are required to optimise the ADF force structure for
the current strategic environment. Defence continues to progress multiple
strike and intelligence, surveillance and reconnaissance capabilities such as
MQ-4C Triton and MC-55A Peregrine aircraft, Apache helicopters, MQ28-A Ghost
Bat and alternative long-range precision strike options.
Submarine escape and rescue system (SEA 1354 Phase 1)
Integrated investment program anticipated that the acquisition
schedule of project SEA 1354 Phase 1 – Submarine escape rescue and
abandonment systems would take from 2016 to 2024 and cost around $400 million to
$500 million (pp. 77; 90). In
March 2019 Phoenix International was awarded a $255 million contract for
the acquisition phase of this project. However, by June 2020, according to the Capability
acquisition and sustainment: quarterly performance report, SEA 1354
Phase 1 had been declared a project of interest (accessed via FOI, pp. 18; 25
In January 2021, the Department of Defence cancelled the
contract with Phoenix International Australia for the supply of a deployable
submarine rescue system. During a March 2021 Senate
Estimates hearing, Greg Sammut (General Manager, Submarines) from the
Department of Defence stated that a review of the project had led to the
decision to terminate the project:
It was to terminate by mutual agreement. I would summarise
the outcomes of the review as: a material difference was identified in the
interpretation and expectations between Defence and Phoenix
that were compromising the execution of the project and contributing to the
ongoing delays. That material difference was seen as also getting us to a position
where it was preferable to terminate by mutual agreement rather than
endeavouring to try to deliver the project (p. 135).
stated that, as at 31 January 2022, the total program expenditure for SEA 1354
Phase 1 was $108 million and that $86 million of this had been paid to
Phoenix International against the contract.
With the cancellation of this project, concerns
were raised about the RAN’s existing submarine escape and rescue
capabilities, which are provided by James Fisher
Defence (JFD) using the
LR5 system. In addressing concerns about submariner safety, the then Navy
Chief, Michael Noonan, asserted
that the existing submarine escape and rescue contract provides ‘services for
all likely scenarios and operational areas under which submarine rescue would
be performed’. Vice Admiral Noonan also pointed out that Australia is a member of ISMERLO (International Submarine
Escape and Rescue Liaison Office), which facilitates submarine rescue support
November 2014, JFD was awarded a 5-year contract for the
provision of submarine rescue services to the RAN, with the option to extend
until 2024. In
February 2020 this contract was extended to December 2023 ‘with an option
to further extend to November 2024’.
Tiger and MRH-90 helicopter programs
During December 2021 the
Government announced that it was scoping the acquisition of
40 UH-60 Black Hawk helicopters to replace the Australian Army’s 40 MRH-90
Taipan helicopters. The Taipan multi-role helicopter was acquired to replace
the RAN’s Sea King helicopters and the Army’s Black Hawk helicopters and was
expected to remain in service until 2037. However, persistent technical
difficulties, rising costs and delays resulted in the aircraft being deemed ‘inefficient,
expensive and unreliable’ by the Government.
The Parliamentary Library publication, MRH-90
Taipan helicopter: a quick guide, covers this topic in greater
The Tiger Armed Reconnaissance
Helicopter (ARH) had also experienced problems with availability and the 2016
Defence white paper stated that the Government would ‘replace the 22
Tiger Armed Reconnaissance helicopters with a new armed reconnaissance
capability from the mid-2020s’. The accompanying Integrated
investment program expanded on this:
The Tiger has had a troubled history – essential upgrades are
programmed to maintain the capability’s effectiveness. Defence will invest in a
future armed reconnaissance capability to replace the Tiger, which could
include manned or unmanned systems or a combination of both, to be introduced
from the mid-2020s (p. 14).
During January 2021 the Minister
for Defence announced that the Boeing Apache Guardian would replace the
Tiger ARH from 2025:
By pursuing a proven and low-risk system offered by the
Apache, Defence will avoid the ongoing cost and schedule risk typically
associated with developmental platforms.” Lessons learnt from issues with the
ARH Tiger and other rotary wing projects had informed the strategy to seek a
proven, mature ARH replacement capability.
Hunter Class frigates (SEA 5000)
The Hunter Class
frigate project has experienced delays that have put construction of the vessels
18 months behind schedule and the launch of the first ship back to 2031. In
turn, this will probably mean that Initial Operational Capability (IOC) will
not occur until 2033. The project has also seen significant cost increases.
The 2009 Defence white paper stated the Government’s intention to
acquire 8 new ‘future frigates’ to replace the current Anzac class vessels (p.
71). The Future Frigates would have a strong focus on submarine detection and
be able to embark both combat helicopters and unmanned aerial vehicles. During
April 2016 the Prime Minister and the Minister for Defence announced:
approval for the Future Frigates. Three designers - BAE Systems with the Type
26 Frigate; Fincantieri with the FREMM Frigate, and Navantia with a redesigned
F100 - have been short-listed to refine their designs.
also stated that the 3 shortlisted companies would provide designs for
consideration by the Government and that second pass approval would take place
during 2018, with construction to begin in 2020.
On 29 June 2018
the Australian Government announced that BAE Systems was the winner of the
tender process to design and build the Future Frigate, which would be known as
the Hunter Class.
The delays have
led to calls for alternatives to be considered as either interim measures or outright replacements.
LAND 400 phase 3
LAND 400 Phase 3 involves the acquisition of 450 infantry fighting vehicles
to replace the Army’s ageing M113
Armoured Personnel Carriers. The project’s
initial cost range was between $18.1 billion and $27.1 billion.
The Turnbull Government provided First Pass approval for the
March 2018. Defence then issued a request
for tender in August 2018, which closed in March 2019. In September
2019 2 companies, Hanwha (Republic of Korea) and Rheinmetall (Germany),
were shortlisted for the next evaluation phase. Both companies have established
subsidiaries in Australia: Hanwha in Geelong,
Victoria and Rheinmetall
in Redbank, Queensland.
companies participated in a 2-year Risk Mitigation Activity that concluded
in October 2021. A decision from government on the successful contractor for
this project was rumoured
for announcement during March 2022, but to date no such
announcement has been made. A
June 2022 media report suggested both contenders had been approached by
Defence prior to the May 2022 election to resubmit their bids for fewer
vehicles. Further delays are expected as the Albanese Government considers the
options in line with budget pressures.
class submarine maintenance
Defence’s largest and most expensive sustainment product is
the ongoing maintenance and upgrade of the RAN’s Collins class
submarine fleet. Commonwealth-owned ASC
is contracted to provide in-service support for the Collins class
submarines (CCSM) at 2 locations: Osborne North, South Australia and Henderson,
Western Australia. The most
complex submarine maintenance activity is full-cycle docking (FCD) which takes
around 2 years to complete and involves the complete refurbishment of the
submarine and selected critical equipment. The CCSM’s planned life-of-type-extension
(LOTE) work, approved by the
Gillard Government in 2012, is expected to occur during each individual
boat’s FCD, starting with HMAS Farncomb in 2026.
Over the last
few years, questions arose
about whether the ASC’s FCD capability, along with the LOTE work, would
move from Osborne North to Henderson. When AUKUS was announced
in September 2021 the Morrison Government confirmed the FCD capability would
remain in South Australia. The overall cost of FCD and LOTE work is expected to
reach $6.4 billion. The 2022–23
Portfolio budget statements included the LOTE in the top 30
sustainment products, with an estimated budget of $104 million for 2022–23
For the first time there are
publicly available metrics on Australia’s defence industry, courtesy of a
collaboration between the Australian Bureau of Statistics and the Department of
Defence. This collaboration produced the Australian Defence Industry Account (ADIA). The ADIA aims to measure the ‘direct economic contribution
of Defence expenditure to the Australian economy in terms of Gross Value Added
(GVA) and employment’. The results of the ADIA feasibility study were released
in December 2021. The study showed that from financial years 2015–16 to 2019–20
the GVA increased from $6.42 billion to $9.72 billion and the estimated
employment from Defence expenditure increased from 57,000 to 80,000 employees.
Of note, these figures do not include ‘high value contracts based on imports’
and only measure contracts directly between Defence and a given business
entity. The comprehensive ADIA is expected to be launched in the second half of
The Albanese Government
plans to develop a Defence industry development strategy and under its proposed Buy Australian Plan, would also seek
to ‘strengthen defence industries and capability’.
consideration of defence issues
The structure of the Australian Parliament provides several
avenues for scrutiny of Defence activities (in addition to the Bills process), including:
These figures are based on full-time equivalent positions. In July 2019,
Defence began an internal process of tracking the size of its external
workforce via a biannual census. Defence officials noted at the Senate
Committee hearing on 25 June 2021 that the census timetable would change to
an annual census. The census results from July 2019 and March 2020 were
released under freedom
of information in September 2020 and the March 2021 figures were provided in
June 2021 testimony during the Senate Estimates hearings for Defence. The
results from September 2020 (not included in this table) and March 2022 were provided to the
Australian Strategic Policy Institute along with revised figures from those
originally provided in the FOI response for March 2020.
The ANAO explains out-turning: ‘When considering and approving budgets, the
Government takes into account the estimated impact of inflation over the life
of a project which is known as ‘out-turning’. At the time of project approval,
project managers estimate the impact of indices tendered (or estimated) for the
life of the project. These estimates are built into the project budget as part
of the out-turning process, which are revised as part of each budget review and
update process’. Australian National Audit Office (ANAO), Major
Projects Report 2017–18: Department of Defence, Audit report, 20,
2018–19, (Canberra: ANAO, 2018), 71.
The Investment Committee is one of 11
enterprise committees within the Department of Defence. It is chaired by
the Vice Chief of the Defence Force and is responsible for the implementation
and delivery of the Integrated
Investment Program (linked is the public version. The classified version is
based on a rolling program that is updated biannually then reviewed by government
in line with the budget cycle).
For copyright reasons some linked items are only available to members of Parliament.
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