The Committee sought submissions on the risks and benefits of a bipartisan agreement on defence policy in Australia, similar to the overseas models outlined in chapter 4.
Submitters expressed a range of views on the concept, in-principle, of some form of bipartisan agreement. The views of submitters varied according to their interpretation of ‘bipartisan’ and of the possible scope of an agreement.
This chapter examines the in-principle benefits and risks of a bipartisan defence agreement to secure stable, long-term defence capability planning and funding.
The Committee heard strong in-principle support for a bipartisan agreement on defence capability and funding from a range of industry and business groups. The Chamber of Commerce and Industry WA (CCIWA) submitted that the defence of Australia ‘should transcend party politics’, highlighting that:
… a bipartisan approach to the planning and funding of our defence capability would ensure Australia's national security has a clear, long-term, bipartisan supported objective.
Defence industry groups highlighted the potential long-term benefits of a bipartisan Defence agreement. The Australian Industry Group (Ai Group) Defence Council, representing the defence industry, applauded the intent of the inquiry to:
… implement the principle that national security is the most important task of government, which should transcend individual political positions of the day and provide budget stability for Defence.
The Committee also heard strong support from the Australian Manufacturing Workers’ Union (AMWU), which represents many workers in the defence industry. The AMWU submitted:
… a strong, bipartisan commitment to long-term strategic and policy stability will have significant benefits to Australia's defence industry. Such a commitment would assist with developing a sovereign capability, encourage investment, improve productivity, lower costs and maintain vital skills.
State and territory governments also welcomed the premise of the inquiry to provide long-term stability for Commonwealth funding of Defence projects around Australia. Air Marshal (ret’d) John Harvey AM from Defence NSW told the Committee that the NSW Government:
… endorses a national and collaborative approach to delivery of defence acquisition, sustainment and operations and looks forward to working with the Commonwealth and the other states and territories to achieve defence objectives, and at the same time growing Australian defence industries.
Budget stability and investment security
The key benefit of a bipartisan defence agreement highlighted by industry groups was in providing budget stability and investment security to allow for the planning and implementation of long-term capability projects. Thales Australia, one of Australia’s largest defence contractors, submitted that:
… one of the critical areas that would benefit from a long-term Bipartisan Agreement is the defence budget. This would allow the ADF to plan acquisitions with certainty, and would similarly allow industry to invest with confidence in support of Australia’s national interest.
The Ai Group Defence Council submitted that long-term budget stability would have many benefits, including ‘providing certainty for sustainment of existing ADF capabilities, upgrade and life-cycle support purposes’ and ‘allowing industry to plan long-term investments to support ADF capability through technology advancements, efficient processes and asset management techniques’.
The Ai Group Defence Council also suggested that long-term stability would encourage investment in Australia’s defence industries. Ms Kate Louis told the Committee:
The question I get asked most … is: 'I'm an overseas parent. I'm looking at all these very attractive things that are happening in defence industry, but will it last?' That is the question they get asked the most, because of the election process. So there's hesitation. There's never going to be perfection. Not everybody would agree totally to every part of the agreement, but if there were something along the lines of those international examples, so that you could say, 'We have brought certainty into this space,' I think it would be very powerful.
State and territory governments also highlighted the need for long-term consistency. Air Marshal (ret’d) Harvey told the Committee:
… what the defence industry needs is consistency: consistency in policy, consistency in planning and consistency in funding so that industry and the states themselves can make the necessary investments in people, training and infrastructure to deliver what Defence and the Australian economy need.
Submitters suggested that the success of current defence funding and capability plans, such as the Integrated Investment Program, would be strengthened by long-term bipartisan support. In relation to the Naval Shipbuilding Plan, the South Australian (SA) Government submitted:
… without bipartisan support, this strategy is vulnerable to future governments reducing funding or failing to implement supporting policies across Defence and other departments. While it is unlikely that a major project, such as the continuous shipbuilding program will be cancelled in the future, other large programs which have not attracted the national attention may be targeted for funding cuts without a commitment by both major parties.
Similarly, the Ai Group Defence Council suggested that a lack of bipartisanship on defence funding in the past has damaged investor confidence:
Historically, the lack of a bipartisan approach has had a profound effect on business and investor confidence, which impacts both delivery of capability and our broader economic interests.
However, other submitters disputed that bipartisanship was required for budget stability. Mr Gerry Wheeler from Raytheon Australia told the Committee:
That's simply not the case. A lack of bipartisanship is hardly a deterrent to business investment. Business looks to government policy and, more importantly, government action, irrespective of whether the major parties agree.
These submitters suggested that there is limited evidence to support arguments that a bipartisan agreement would improve long-term capability planning processes. Professor Richard Tanter from the University of Melbourne submitted that these arguments:
… have rarely progressed beyond generalities about ‘waste’, ‘inefficiencies’, and ‘political interference’ with good planning practice and investment planning horizons, with remarkably little evidence adduced to support these claimed chains of causation.
The Australian Strategic Policy Institute (ASPI) also questioned what problem would be solved by improved funding stability and investment certainty through a bipartisan agreement. ASPI suggested that in the absence of such an agreement, few political decisions have negatively impacted on Australia’s capability development:
Without a formal bipartisan agreement in place, Defence has still managed to launch a 35-year-long future submarine project, and is well down the road to a rolling production model for warships. The F-35 Joint Strike Fighter acquisition has survived two changes of the party in government (so far)—and, we might add, five prime ministers and even more defence ministers. Politics has caused some disruption to defence plans over the past 15 years—not least the decision of the government of the day earlier this decade to reduce Defence’s budget—but it’s hard to point to any change that has affected the ongoing development of capability in an enduring way.
ASPI also questioned the need for improved continuity for Defence planning, suggesting that under the current system Australia’s force structure has remained relatively stable:
… changes in the strategic environment or the domestic political scene don’t seem to have much impact on the development of Australia’s armed forces. The ADF’s force structure of today would seem very familiar to a defence planner from any of the past five decades. And the projects currently approved and underway will lock in a similar structure for the next few decades as well. It’s hard to see how lack of continuity in defence planning represents a problem for the ADF—it continues to happily replicate itself.
Development of sovereign capabilities
In particular, defence industry groups highlighted that budget stability would assist in the investment in and development of Australian sovereign capabilities. Thales Australia submitted:
… given the increasingly uncertain geopolitical environment, protecting and promoting the current investment in sovereign capability is a worthy endeavour. As the defence industry invests in Australian creativity, ingenuity and ability in order to deliver the next generation of sovereign capabilities for the ADF, a Bipartisan Defence Agreement would provide more certainty for these critical long term investments.
Submitters highlighted that investment in sovereign capability and workforce would have broader benefits for the Australian economy. The Ai Group Defence Council suggested that the long-term certainty of bipartisan agreement would maximise:
… Australia's investment in the defence industry through programs such as naval shipbuilding and armoured vehicles for the benefit of Defence, Australia's economy and the broader community.
The Defence Materials Technology Centre (DMTC), which focusses on strengthening Australian industry capacity, emphasised the importance of long term stability for the development of defence technology:
Success in the defence sector, and in innovation and technology development in particular, is widely accepted as a ‘long game’. Technologies can take many years to develop and mature, and this requires discipline and perseverance but also a standardised approach.
In particular, the SA Government argued that the certainty provided by a bipartisan agreement would encourage investment by defence industry and state and territory governments:
The certainty of an agreed bipartisan approach to Defence planning and funding would provide the industry, state and territory governments with surety to invest in research and development, infrastructure and skills and education programs. This investment is critical to build Australian sovereign capability, not just in our ability to manufacture platforms and equipment, but for the longer term sustainment of our sovereign defence industry. Relying on overseas companies to manufacture our platforms and equipment is costly, inefficient and impacts the employment and development of Australian workers.
The SA Government further highlighted that:
Investment in the development of intellectual property to build sovereign capabilities is more attractive if a bipartisan approach to Defence planning and funding is agreed upon. A unified approach will also enable the Defence Science and Technology Group to establish clear priorities, making better use of the government’s limited resources and obtaining the best value for money from the Next Generation Technology Fund and the Innovation Hub. This coordination, with the requisite investment, may result in increased commercialisation of Australian intellectual property and export of new products.
The SA Government suggested that ‘continually changing policy’ on defence planning has ‘damaged Australia’s reputation on the international stage’ to attract investment in defence projects and has driven investment offshore:
This has resulted in international companies choosing not to invest in Australian industrial capability. This results in a significant amount of taxpayer funds being diverted offshore to support the development of foreign workforces and industrial capabilities.
Cost savings and reduce inefficiencies
Another suggested benefit of improved stability was cost savings and reducing inefficiencies caused by short-term changes to priorities, such as mobilising and demobilising workforce requirements. Mr James Baker, Head of Corporate Affairs at Boeing and member of the Ai Group Defence Council told the Committee:
The biggest benefit I see would be in cost savings because, with a longer and more assured schedule of programs and what I might call strategic ballast to policymaking, it allows us to make investments as industry and across industry. When we can have a longer planning cycle, we can get cheaper facilities. We can position human resources where they need to be and get the right people in the right place at the right time. That can translate into cost savings in the long term for Defence, when we have that assurance.
Some submitters suggested that the lack of a long-term, consistent strategy has resulted in significant expense and inefficiencies in the acquisition of defence capabilities. Mr Steve Kuper and Mr Dom Raff suggested:
… construction problems throughout the procurement of the Collins class submarines and the knee jerk purchase of HMAS Choules combined with more recent design and manufacturing issues with both the MRH-90 Taipan and ARH Tiger helicopters and the larger Canberra Class amphibious warfare ship and Hobart class air warfare destroyer projects all serve to highlight the limitations of the nation’s domestic industry to provide and sustain material in response to incoherent, knee jerk policy and doctrine.
Defence industry groups suggested that this long-term stability would lead to cost savings over the course of current long-term capability projects. Thales Australia submitted:
With significant defence projects, like the Future Submarines, Future Frigates and the LAND4000 vehicles in service for decades, patient long-term investment by the defence industry is crucial to ensure the most cost effective delivery and servicing over the life of these projects. Certainty that decisions will not be substantially re-prosecuted or project timings adjusted to suit the political budget cycle by incoming Governments would ensure investment over the life of projects.
Limits of contestability
As discussed in chapter 2, ‘bipartisanship’ is a contested term with no agreed definition of the limits of contestability. Submitters suggested that any bipartisan agreement should focus on the following three key areas.
Submitters suggested that a common understanding of strategic risks, priorities and objectives is integral to underpin any bipartisan agreement. Former Vice Chief of the Defence Force (VCDF), Lieutenant-General (ret’d) Des Mueller AO reminded the Committee of Winston Churchill’s observation that:
The distinction between politics and strategy diminishes as the point of view is raised. At the summit, true politics and strategy are one.
Submitters also acknowledged that there is likely to be significant disagreement on the strategic outlook both within and between political parties. Dr Andrew Davies from the Australian Strategic Policy Institute (ASPI) told the Committee:
I'm not sure that we're ever going to have a consensus on the strategic outlook. You've only got to look at the debate that has been going for at least 10 years on the significance and nature of the rise of China and what that means for Australia and its strategic policy settings vis-a-vis the United States.
The Committee was reminded of the well-known dictum attributed to the former Secretary of Defence, Sir Arthur Tange, that ‘a strategy without dollars is not strategy’. Former VCDF, Lt-Gen Mueller, went further to suggest to the Committee that ‘strategy without dollars is hallucination’.
Submitters emphasised that any bipartisan agreement would need to include a commitment to funding. Raytheon Australia submitted:
… if a bipartisan defence agreement is to mean anything at all it must involve a shared commitment to a strong yet defined level of defence funding.
Defence industry groups strongly supported the increase in defence spending target of two percent of current GDP set out in the 2016 Defence White Paper (White Paper) and suggest this form the basis of any long-term commitments.
Raytheon Australia, which did not support a bipartisan agreement, suggested that the long-term commitment to funding set out in the White Paper, would allow for industry stability, while allowing flexibility for governments in making decisions about operations:
… the virtue of the ten year funding model is that it provides a logical benchmark upon which political parties can align their own funding commitments through to the middle of the next decade. The fact that operational funding is not presented as part of this model is also convenient as it allows parties to reserve their political positions in relation to individual military engagements. This is entirely appropriate as it would not limit parties’ ability to establish their own foreign policies.
Finally, submitters recommended that an agreement should include commitment to the capability plan the funds are intended to acquire. The CCIWA submitted that committing to the Naval Shipbuilding Plan, for example:
… would provide reliability in terms of business investment, while also ensuring Australia's defence industry workforce has confidence in career longevity.
In developing these capability plans, submitters highlighted the importance of also addressing each of the issues below.
States and territories
As discussed in chapter 2, the Committee recognises the risks of destructive competition between states and territories in bidding for defence projects. Air Marshal (ret’d) John Harvey AM, the NSW Defence advocate, told the Committee of the importance of the Commonwealth working with states and territories on any long-term defence planning processes:
States should not be fighting over slices of the pie. Instead, we all should be working together to make the pie bigger for all so that all states and the Commonwealth gain. We need to have states and territories working together so that the maximum amount of defence work can be done in Australia.
Input from state and territory governments highlighted the importance of ensuring that states and territories are involved in any long-term defence planning processes. The South Australian Government submitted that it:
… supports the concept of Bipartisan Australian Defence Agreement as a mechanism to ensure consistency and longevity of defence funding and projects regardless of which party is in power. The State believes that this planning will need to be developed jointly with the states and territories.
Submitters from the defence industry also highlighted the importance of ensuring that industry is involved in the long-term defence planning. The Defence Materials Technology Centre (DMTC) suggested that as well as budget, an agreement should include:
… industry policy, the setting of innovation priorities within the capability life cycle, equipment procurement frameworks and the management of local content obligations.
Defence industry groups expressed their interest in contributing to the development of defence policy. The CCIWA submitted that it would:
… welcome the opportunity to be involved in the development of a Bipartisan Australian Defence Agreement and to be recognised as a global leader in shipbuilding and defence. With the strategic importance of direct access to the Indian Ocean and HMAS Stirling - the Royal Australian Navy's largest base - WA has a critical role in the nation's defence and sovereign capability.
Submitters highlighted that any capability plans must consider the capability of the Australian workforce to undertake significant defence projects. The DMTC suggested that workforce considerations are a ‘critical area that demands a long-term view’.
Submitters highlighted that these plans must ensure research and educational institutions are supported to invest in the long-term training of the defence industry workforce. The SA Government submitted:
Universities and vocational institutions will not invest in developing a defence orientated curriculum unless there is a long term market for the skills and knowledge that students will obtain and importantly, STEM students will not be attracted to a course that does not have an attractive long term career path. Industry will not invest in upskilling their current staff or employ new staff, unless they have confidence in the long term future of the industry.
As discussed in chapter 2, the Committee recognises concerns about bipartisanship operating as a process of uninformed concurrence which limits debate and discussion, rather than agreement reached following informed debate and discussion. It was this form of bipartisanship that was most strongly opposed by submitters.
The Committee heard from a number of submitters who did not support the introduction of a bipartisan defence agreement. These submitters questioned whether an agreement would improve Australia’s defence planning processes. Professor Richard Tanter submitted:
There are quite distinct sets of reasons as to why major problems of defence planning and procurement persist, besides the lack of a BADA [Bipartisan Australian Defence Agreement], and which indicate that a BADA in itself is unlikely to achieve the results proponents suggest.
Dr Andrew Carr from the Australian National University’s (ANU) Strategic and Defence Studies Centre argued that the perceived benefits of bipartisanship, namely that it would ‘contribute to the development of good policy, build national unity and protect those serving in the Australian defence forces’, are in fact undermined by the way bipartisanship currently operates:
… bipartisanship as it currently operates in Australia is not only failing to meet its expectations but actively impeding Australia’s national security.
The Committee also notes the opposition to a bipartisan agreement expressed in the public arena. Canberra Times journalist Nicholas Stuart has argued that such an agreement is ‘actually a very bad idea’ and risks ‘outsourcing of defence strategy to business’.
Like Professor Tanter, Mr Kieran McGuiness and Professor Greg Austin have suggested that there is ‘little evidence that disagreement between the two political parties (the Coalition and the Labor Party) is the main cause of disruptions to major defence strategies, force structure planning and funding’. Rather, they point to a series of reports, including the First Principles Review, that identify Defence itself ‘as one of the main obstacles to effective and efficient force procurement’:
None of these reports suggests that a lack of bipartisanship was to blame for procurement and availability problems. Instead, when things go wrong they often appear to be failures of government, rather than the result of changes of government between one party and the other.
Submitters also questioned whether there is adequate political support for a bipartisan agreement. Mr Gerry Wheeler from Raytheon Australia told the Committee:
… it's apparent there is no political groundswell amongst the community that would encourage a bipartisan defence agreement, nor is there any discernible political will to strike such a bargain. It's both the right and responsibility of political parties to express their own distinct policy positions, and I think it's very important that electors are provided with a clear choice on the issues of national security, just as they would expect to be provided with such a choice on any other important matter of public policy.
The key risks of a bipartisan defence agreement identified by submitters to this inquiry were a lack of scrutiny, flexibility and inconsistency with other policy areas.
Lack of scrutiny and debate
One of the key concerns raised by submitters was that a bipartisan defence agreement would restrict political and public scrutiny and debate on defence policies in Australia. Submitters highlighted the urgent need for more public debate on defence. The Religious Society of Friends submitted that:
As a democratic country and a champion of democratic rights, more provision must be made for open, transparent public debate on foreign policy, national security and defence.
As discussed in chapter 2, a number of submitters expressed concern that the current bipartisan approach to defence policy is already restricting open and contested debate and public scrutiny of defence policy. Dr Carr submitted
… it would be an error to adopt a formal bipartisan structure for defence policy. Instead, it is more politics and contestation of defence policy via our elected representatives which Australia needs to deal with these uncertain times.
Building on Dr Carr’s analysis, Mr Stuart has also argued for more debate, noting that the idea of bipartisanship assumes there is a ‘right’ answer or ‘correct’ strategy for Australian defence policy:
With that comes an appropriate way of allocating money to particular projects or, if you prefer, sharing out the toys. Unfortunately, deciding on the right mix of equipment, forces and strategy isn't simple. Concepts need to be challenged. If it's just left to the military, a bureaucratic formula for divvying up the spoils will emerge.
Similarly, Mr McGuiness and Professor Austin have also argued that:
… the quest for bipartisanship, if implemented, would further erode the low levels of scrutiny of national security policy by Australian voters and deny citizens public contestability of how governments invest billions of taxpayer dollars in local defence skills and jobs. Less partisan debate in the parliament would also mean less media coverage.
Former Vice Chief of the Defence Force (VCDF), Lieutenant General (ret’d) Des Mueller AO told the Committee that formalising a bipartisan defence agreement is ‘probably unnecessary’ and the political benefits are ‘not compelling’ as ‘there is already a significant level, perhaps an excessive level, of de facto bipartisanship where defence policy is concerned’. Lt-Gen Mueller suggested that more bipartisanship risks reducing public debate even further:
The real danger of a bipartisan agreement is that it could become an exit ramp from the more robust, better-informed and ongoing discussion about defence which is what the national interest deserves.
Professor Richard Tanter argued that the limited public scrutiny and debate of defence policy, particularly Australia’s relationship with the United States, would be exacerbated by a bipartisan agreement:
Such capacity for systematic consideration of how Australian strategic interests are to be formulated and fostered should be the foundation of Australian defence debate, both in the security community and in the public sphere at large … Not only does the existing degree of bipartisanship inhibit this capacity developing, but a formal Bipartisan Australian Defence Agreement would create a policy environment even more inimical to democratic accountability of government based on public consideration of the interests of Australian people.
Submitters suggested that seeking a bipartisan agreement, rather than encouraging robust debate, would see policies shaped to meet a ‘lowest common denominator’. Dr Andrew Davies and Dr Mark Thomson from the Australian Strategic Policy Institute (ASPI) argued that:
… the negotiation of a bipartisan agreement would reduce the government’s executive prerogative by forcing it to shape its defence policy to a lowest common denominator. Defence is too important for that. The government should be able to assert its position, and the opposition should be able to test and challenge and contest government policy in defence as it does in other areas. A robust policy debate with substantive points of difference is a strength, not a weakness, of our democratic system.
Similarly, Mr Gerry Wheeler from Raytheon Australia told the Committee that:
… rather than having an agreement on the lowest common denominator, which is invariably what would happen, a contest on the best possible ideas in defence policy is a much better way to go. I think that sort of approach would lead to better policy outcomes.
Mr Wheeler suggested that debates on defence policy should be developed and prosecuted by political parties:
I think the most important thing is a competitive and contestable market for ideas on defence, capability use in particular, and I think that should come from each political party organisation to develop those ideas and push them forward. I wouldn't want to see them constrained by any artificial construct of parliament, for example ... I think encouraging that sort of public discussion within political parties is incredibly important.
Rear Admiral (ret’d) James Goldrick AO CSC, also expressed concern about the low level of community understanding of defence issues. Rear Admiral Goldrick argued that a bipartisan, or more ambitious ‘non-partisan’, agreement on defence would not be possible due to this lack of understanding, and made a series of recommendations to improve public education about defence.
Dr Simon Reay Atkinson and Dr Jean Jonathan Bogais suggested that the grounds for effective bipartisanship ‘may not exist’ in the current Australian Parliament and therefore any agreement on defence:
… might encourage tokenistic group-think, and so play into the normative biases of powerful lobbyists, political advisers, academics, and policy-wonk tankers – more so than Parliamentarians and the country as a whole. It could potentially be very dangerous, exactly by removing the grounds remaining for healthy debate and contest between the major parties – and, or, preventing the major parties from identifying the common values upon which they might negotiate ethically, in Good Faith.
Other submitters that supported a bipartisan agreement agreed on the importance of facilitating and encouraging an open and robust political debate on defence policy. For example, Thales Australia submitted:
Australia’s national interest is best served by a robust and informed policy debate. Without inbuilt protections, a long-term agreement between the major parties could lead to a lack of contestability at this level, which would be contrary to the objectives of this process.
Some submitters suggested that a bipartisan agreement would not necessarily preclude contest and debate on defence policy. Mr Mike Nicolaides from the AMWU told the Committee:
If there was a bipartisan agreement, that would not guarantee that there would not be vigorous debate and contest around particular issues so it won't necessarily provide the stability for workforce, for example, that we would like to see. The advantage we see in a bipartisan approach is that it would foster a longer term view and would concentrate, we would hope, more on public policy than on … short-term electoral advantage. So we are trying to lift defence policy, which we see as requiring long-term thinking, out of maybe a three-year cycle or, in some cases, less. That's not to say that there won't be vigorous debate in a contest of ideas and regular disagreement about where the policy should land.
Others suggested that rather than a ‘lowest common denominator’, a bipartisan agreement could facilitate reaching a more balanced and reasonable position. Mr James Baker from Boeing suggested:
Some of the more hawkish would be brought in by consultation, and some of the more dovish might be brought into a more centrist position. So I don't think it would be the lowest common denominator. I actually think it would get a much more reasonable and sustainable position.
Similarly, Ms Kate Louis from the Ai Group Defence Council noted that international examples of bipartisan agreements ‘don't seem to be the end of the world, the sky falling in or the end of democracy’:
From what I can see, they had some pretty sensible approaches, setting out what the focus of the Army should be, what the strategic requirements are, what the big capabilities should be. It didn't seem to be the least common denominator. It seemed to actually be quite brave and ambitious.
Lack of flexibility
The other key concern raised by submitters was that a long-term bipartisan agreement would limit the ability of Australian Government’s to respond to changing strategic and domestic circumstances. The Medical Association for Prevention of War submitted:
Critical government funding of health, education, housing, renewable energies and many other essentials are regularly reviewed and budgets changed. Decisions that are locked into the longer term do not have the benefit of ongoing review and adjustment in the light of changing circumstances.
Former VCDF, Lt-Gen (ret’d) Des Mueller, told the Committee that governments need flexibility to respond to changes in domestic economic and policy changes:
Bipartisan agreement on future funding might be of benefit in terms of the increased stability it could bring to defence planning, and its implementation, especially for the longer term capital equipment investment program and the maintenance of preparedness levels. However, on reflection it is difficult to see this happening. The need for governments to retain freedom of action in dealing with possible changes in economic circumstances and changes in domestic policy priorities suggest that a bipartisan agreement on defence funding might not be either practical or desirable when viewed from a wider national perspective.
Similarly, ASPI highlighted the need for domestic flexibility:
The underlying forces that are reshaping our geopolitical environment are also reshaping our economic prospects and, indeed, to the socioeconomic fabric of Australian society. The character and severity of, and the possible responses to, these many challenges are only slowly being revealed. Such is the inherent uncertainty of the future. Consequently, governments need to have the freedom to respond with agility and, when necessary, to reallocate resources from one area to another.
In addition to domestic changes, submitters highlighted the need for flexibility to respond to strategic changes in our region. Dr Andrew Davies asked the Committee to consider:
… what might have happened had Britain had defence policy settings in September 1939 that had been agreed upon and locked in in 1934?
ASPI argued that a bipartisan agreement risked ‘[T]aking away the discretionary power of a future government to make different decisions about its strategic priorities’ and would be ‘at odds with Australia’s model of governance’ ASPI suggested that a bipartisan agreement ‘would create, rather than retire, strategic risk’:
Governments must sometimes deal with dramatic changes of circumstance, and there’s no guarantee that the force structures and military hardware and software of today will be the right answer even a decade from now … The amount spent on Australia’s defence, and how that money is spent, should be subject to constant review and analysis. Locking in spending levels and capability priorities would render such analysis pointless.
Similarly, Thales Australia suggested that the agreement would need to ‘balance the Government of the day’s flexibility of decision making, allowing it to respond to major defence and security issues as they arise without any unnecessary delay’.
However, some defence industry groups highlighted that a lack of agreement risked creating further long-term uncertainty. Ms Kate Louis from the Ai Group Defence Council asked the Committee:
… if you don't do that, is the alternative better? The alternative is not to lock ourselves into anything—not to have an agreement, I should say—and then you're subject to the roller-coaster.
Inconsistency with other policy areas
Some submitters questioned why defence policy should be treated differently from other significant areas of government policy, such as the economy, health and education. ASPI submitted:
It’s all very well to lament the frustrations of Defence planners and defence industry executives, but they are no more deserving of pity than the hospital administrators, school teachers and taxpayers who might otherwise have carried a heavier burden.
These submitters questioned why a specific agreement was needed for defence. Dr Carr asked the Committee:
I'm unsure why defence and security issues are seen as that different from other complex areas of policy—why we would need a special mechanism in order to encourage or enable members and senators to understand and engage.
ASPI suggested that defence policy, like other policy areas, should be debated and tested through the electoral cycle:
… our governments are elected by the people of Australia on the basis of the platforms they take to the polls, not appointed by Defence’s planners for their convenience. If the Australian people want a different approach to our defence—whether more, less, or just different—they will have their reasons for doing so. We don’t see why defence planners should have any more protection from changes in public and government priorities than those planning for the nation’s health, education or energy requirements.
Other submitters argued that defence should be treated differently as the defence is one of the key priorities of the national government. Mr James Baker from Boeing suggested:
We have come up with this culture, this belief, that the most important task that a government can take on is the defence of the nation-state—because if you don't defend the nation-state it doesn't exist. Taking that as the most important thing, it may well be the policy area where you want to reach bipartisanship to achieve the effect. If you don't have a nation-state, or it is threatened, you're not going to be able to educate the people, provide health or order or any of those other services.
These submitters suggested that the proposal being put forward for defence could be applied in other policy areas. Mr Baker told the Committee:
… there's actually nothing to stop us having a similar debate in health or defence. That's up to the various approaches to politics … In defence … we just think that it would allow for some longer term planning, and it would bring benefits for the budget that you have to spend. You could do that in health, but it doesn't stop you doing it in defence.
Ms Louis from the Ai Group Defence Council suggested that a bipartisan agreement on defence could in fact serve as a model for policy making in other sectors:
If we were able to say that they did actually get their heads together and were able to go through all these important challenges … you could certainly look at it in other parts as well. In that context, I think this committee is a fantastic way to maybe pave the way for other sectors.
As discussed in chapter 2, the Committee considers that ‘true’ bipartisanship refers to the outcome of a process of debate and discussion between parliamentarians that leads to willingness to commit to a position, not mere agreement to avoid debate. The Committee agrees that robust and open debate is integral to the effective functioning of Australia’s democratic system. The Committee shares the concerns of submitters about the current lack of parliamentary and public scrutiny and debate about defence policy in Australia.
The Committee acknowledges that the inquiry set out to examine the risks and benefits of what was assumed to be a written bipartisan defence agreement; one arrived at after negotiation between the Government and the Opposition, and possibility other political parties represented in the Australian Parliament. However, as discussed in chapter 4, the Committee recognises that the international models of formal bipartisan defence agreements, such as those in Denmark and Sweden, would not be consistent with Australia’s parliamentary system.
The Committee acknowledges that in asking submitters to comment on the benefits and risks of a ‘bipartisan defence agreement’, it did not articulate the specific form of such an agreement. The Committee is grateful for the views of submitters on the broad concept of ‘bipartisan agreement’ on defence. The Committee heard that bipartisan agreement can take different forms in different contexts. The Committee’s conclusion, detailed in chapter 6, is at this point in time that a written bipartisan defence agreement is not the most appropriate approach in the Australian political and constitutional context. Instead, the Committee considers that what is required is a means to achieve bipartisan understanding of the strategic threats to Australia and the available policy and military responses, and necessary military capability. The Committee considers that better informed and more thorough parliamentary engagement in defence and security issues is what is required to achieve this understanding.
Evidence from submitters suggests that ‘bipartisan agreement’, that is, agreement between parliamentarians following debate and discussion, could have significant benefits for Australia’s long-term defence capabilities.
The Committee agrees that one of the key benefits of bipartisan agreement would be long-term budget certainty and investment security. The Committee agrees that budget certainty at the Commonwealth level could encourage further investment by industry and state and territory governments in developing Australia’s defence capability. The Committee recognises that this investment is critical to developing sovereign capability here in Australia and supporting our local defence industry.
The Committee further agrees that long-term stability could assist in reducing costs and inefficiencies in the delivery of long-term projects, such as the Naval Shipbuilding Plan and also provide context and understanding to allow better ongoing scrutiny.
In addition, the Committee considers that bipartisan agreement on long‑term strategic goals and challenges could support greater strategic consistency with regard to force posture, capability planning and Australia’s defence alliances.
The Committee agrees that in seeking bipartisan agreement on defence capability plans, parliamentarians should seek to address the following three areas: strategy, funding and commitment to specific capability plans.
In developing such capability plans, the Committee agrees that there should be stronger mechanisms for states and territories to contribute to the development of long-term capability plans. The Committee considers this would encourage constructive competition between states and territories to ensure Australia can develop the best possible defence capabilities, and address the concerns about destructive competition outlined in chapter 3.
The Committee also agrees industry should be included in the development of long-term capability plans. Greater involvement from industry would be consistent with the commitments to developing sovereign capability set out in the Integrated Investment Program, Defence Industry Policy Statement and Defence Industrial Capability Plan.
The Committee further agrees that the development of an appropriately skilled workforce is integral to the development of sovereign Australian defence capability. The Committee agrees that any long-term capability planning must address measures to train and support those elements of the defence industry considered to be Fundamental Inputs to Capability (FIC).
The Committee recognises concerns raised by submitters about the possible risks of bipartisan agreement. The Committee recognises that these concerns about ‘bipartisanship’ refer to bipartisanship as an alignment driven by political convenience, as outlined in chapter 2.
However, the Committee disagrees that bipartisan agreement would further limit this scrutiny and debate. The Committee does not agree that bipartisan agreement would lead to compromise whereby policy is shaped by the ‘lowest common denominator’.
Rather, the Committee contends that bipartisanship agreement achieved through a process of informed debate would encourage and improve debate through facilitating discussion on key government decisions about defence strategy, capability and budgets.
The Committee notes that this form of bipartisanship is currently demonstrated by the Parliamentary Joint Committee on Intelligence and Security (PJCIS). Members of the PJCIS, have access to classified briefings and information, facilitating well-informed debate and discussion on national security legislation and policy. Following these debates, the PJCIS is able to develop bipartisan advice for the Executive to consider.
The Committee notes that many of the criticisms raised by submitters about the risks of bipartisanship are addressed by the PJCIS model. The Committee acknowledges that the PJCIS encourages well-informed internal debate between government and opposition parties on how to best address Australia’s national security challenges.
The Committee recognises that it would not be appropriate to discuss certain aspects of defence policy in public. The Committee recognises the need, similar to the PJCIS, for a secure forum for parliamentarians to debate and discuss defence policy independent from the Executive or Defence.
The Committee also recognises concerns about the need to allow the Executive the flexibility to update and change its plans according to changing strategic and domestic priorities. The Committee considers that any agreement should be subject to ongoing scrutiny and debate.
Finally, the Committee considers that a mechanism for seeking bipartisan agreement on defence, rather than other policies areas such as welfare, health and education, is warranted for three key reasons:
key information on defence is not readily available and cannot be made available without safeguards;
defence policy, particularly the alignment between strategic need and military response options, is complex and often sensitive; and
the defence portfolio is one of the largest areas of government expenditure where the government has the most discretion in making large investment decisions.
The Committee agrees that a model of bipartisanship that engages parliamentarians in the development of defence policy could serve as a model for other policy areas.
The Committee’s proposed mechanism for seeking bipartisan agreement on long-term defence plans through improving parliamentary engagement is outlined in chapter 6.