5.1
This chapter considers challenges and opportunities impacting Defence workforce, specifically:
Contractors, consultants and labour hire
5.2
The Defence Annual Report 2019-20 states that a range of new initiatives, combined with enhancements to previous programs, have been implemented to attract, recruit and build the required workforce, and support Australian Defence Force (ADF) members and their families:
The Total Workforce System (formerly the Total Workforce Model) continues to mature. The application of an integrated workforce, drawing on the diverse skills and strengths in both the permanent and Reserve elements, was demonstrated during Defence’s contribution to the national responses to the bushfire emergency and the COVID-19 pandemic.
The ADF Cyber Professional Framework was developed to support a common workforce taxonomy and foundational job requirements for cyberspace operator roles. A Cyber Professional Development Blueprint and roadmap outlines key activities to continue the professionalisation of the cyber workforce.
By bringing intelligence capabilities from across the enterprise together into a new Defence Intelligence Group, there will be improved coordination of Defence intelligence to support ADF operations and Defence activities and take advantage of emerging capabilities. Implementation was phased over 2020, with initial Defence Intelligence Group capability operating from 1 September 2020 and full establishment by 1 January 2021.
The Defence Science, Technology, Engineering and Mathematics (STEM) Council is leading a collaborative approach across Defence and other agencies to develop the talent pipeline for careers in science, technology, engineering and mathematics in the national security sector.
The Defence Enterprise Learning Strategy 2035 was launched to provide strategic guidance across Defence’s education and training domain, which will improve access to learning and further develop Defence’s intellectual edge.
Targeted ADF recruitment activities in relation to engineering, health, naval, and intelligence related roles were undertaken. This included a successful competition to encourage potential candidates to consider a career as a submariner.
Defence continued to use Specialist Recruiting Teams for Women, comprising current serving Defence women, to assist with the promotion of Defence careers for women and provide mentoring support through the recruiting process.
Information sessions focused on women, mentoring programs, and experience camps are ongoing, intended to address some of the perceived barriers to entry.
Pathway programs to support Indigenous Australians progressing to a career in the ADF were conducted in Cairns, Darwin, Kapooka and Wagga Wagga. In addition, the Defence Work Experience Program hosted 437 Indigenous students across Australia.
In delivering on the Naval Shipbuilding Plan, demand and supply strategies have been developed. This includes a dedicated Maritime Engineering and Naval Construction APS graduate stream, supported by a mentoring program to best develop the technical and professional skills of this foundation workforce. Recruitment is currently underway for the fifth intake of graduates.
Services to support ADF families continued to expand, including through the Defence Childcare Program Individual Case Management Service, which assisted 86 families in 2019–20 to source appropriate childcare arrangements when a Defence childcare centre was not available.
To raise awareness of family and domestic violence, the ADF provided a targeted training and education program for supervisors and commanders.
A range of mental health initiatives were progressed, including the Periodic Mental Health Screen in all garrison health centres, to provide early identification and intervention for members with mental health concerns.
Partnerships with industry, other government agencies and the education sector were strengthened to build skills that will yield better results for Defence capability. Key to this was the launch of the Defence Industry Skilling and STEM Strategy.
Recruitment
5.3
The Defence Annual Report 2019-20 states that:
In 2019–20 Defence recruited more than 7,500 personnel to permanent and Reserve roles in the ADF, resulting in 93 percent of permanent force targets being filled. Defence recruited 526 Indigenous Australians, representing 72 per cent of the target for Indigenous recruitment. Challenges remain in recruiting Army Reserves, officer entry submariners and women in STEM roles. In the fourth quarter of the year, the implementation of online testing and the enhancement of telephony systems broadened our ability to identify the right talent and progress candidates more quickly through the recruitment process.
5.4
Recruiting for all three services is currently at approximately 88 per cent achievement of the overall target of approximately 7000 people per year. Defence recruits across the service spectrum: into the reserves, predominantly for Army, but also into permanent forces. Defence considers this recruitment outcome a particular success given that it was achieved during the COVID-19 pandemic. A number of Five Eyes partners have had less success in recruitment as a result of the pandemic.
5.5
As a result of the cancellation of over 2,000 recruiting events in 2020, Defence was unable to engage with the Australian population via usual face-to-face means, so it had to pivot quickly to digital platforms and digital recruiting events. This change was critical to achieving the 88 per cent of recruitment targets during the pandemic.
5.6
Defence faces competition for talent in a number of areas:
They are the same areas that all of Australia is concerned about. In terms of the skills, the science, technology, engineering and maths related skills that all of Australia would like are absolutely those that the Australian Defence Force want. Our market competition is predominantly in that field.
5.7
Defence also submitted that it is still working to increase female participation:
We would like more women to join the Australian Defence Force, and we have specific measures around joining to mentor and support young women, and we are recruiting for that. Those numbers are down on where we would like them to be. Around 19.7 per cent of personnel in the Australian Defence Force at the moment are women. Navy and Air Force are up at the almost 25 per cent—Air Force are at 25 per cent. Army, with greater numbers of women…relative to the size of the ADF—are sitting at over 15 per cent.
Indigenous recruitment
5.8
Defence has specific initiatives in place to improve Aboriginal and/or Torres Strait Islander participation in the ADF. Defence’s Public Service workforce currently has a 2.2 per cent Aboriginal and/or Torres Strait Islander participation rate, and the Australian Defence Forces stand at 3.3 per cent.
5.9
Defence sees its Indigenous Australian recruitment pathways as benefitting not only Indigenous individuals but also Indigenous communities:
We see [indigenous recruitment pathways] as…great community development programs. The success of the program isn’t so much joining the Australian Defence Force; it’s what the individuals gain from the programs in education, finance, health, fitness and that whole-of-person experience in those programs. Some actually then do choose to come and join the Australian Defence Force, which is fantastic. We have mentoring programs for our Indigenous people in Defence. We have Indigenous elders who not only guide us on how we celebrate our Indigenous heritage but also how we should work to retain our Indigenous people…We are very conscious of what our fantastic Indigenous heritage gives us and then how we can benefit with that.
5.10
Defence is taking a supply-side approach to recruitment where it needs to engage the broader spectrum of ethnicities, gender, socioeconomic status and other demographic considerations. This places the focus on what the talent market can provide as opposed to simply applying strict military entrance criteria. This approach has been effective in improving Indigenous participation.
5.11
Successful increases to participation of Indigenous females in the ADF is also attributable to Defence’s community engagement programs. Of its current Indigenous community enlistments into the ADF, 23.8 per cent are women and in the APS that figure is 80 per cent.
Retention
5.12
The Defence Annual Report 2019-20 states that:
Retention of our workforce and their skills and experience is critical to the effective delivery of Defence capability. The Pathway to Change strategy, evolving a workforce culture, embedding the right Defence leadership behaviours and developing a safety culture are critical to our operational effectiveness and to both attraction and retention of a potent Defence workforce.
5.13
The ADF is currently less than one per cent — approximately 500 people — under its funded strength which is considered appropriate. Defence, however, has identified some workforce planning risks in its middle ranks, such as Sergeant, Warrant Officer, Captain or Major. This is due to the time required to develop the required capabilities at these ranks, and because of the depth or training and experience that is required.
5.14
Defence submitted that separation rates are currently low across all three services and that Navy, in particular, has improved substantially since the publication of the 2019-20 report. The Navy separation rate is around six per cent. Army achieved minor growth in accordance with the Force Structure Plan and is currently only slightly under its approved and funded strength. Air Force continues to maintain a low separation rate, and is on a growth path in accordance with the Force Structure Plan.
5.15
Defence has a number of retention strategies available, including:
Where it’s about competition in the market, we are able to have deliberately differentiated packages to secure more remuneration for some of our key trades. The submariner trade at the moment is one of those areas where we know we’re growing and we have a deliberately differentiated package for our submariners…That’s a combination of remuneration, professional development and different career management and posting options to support the growth of that trade. So it’s not just remuneration; it’s the package.
5.16
Recent changes to leave policy have also been implemented as retention measures. Previous long service leave rules were restrictive in that they required members to take leave in large blocks. The new policy allows members to take long service leave in a minimum of seven-day periods, allowing them to effectively supplement their normal annual recreation leave, including cases where a member’s annual leave balance may be depleted due to family circumstances.
ADF strength
5.17
The ADF is relatively very small compared to other militaries active in our region. As at February 2021, according to the International Institute for Strategic Studies, the number of active service personnel in various relevant militaries is as follows:
5.18
The Inspector-General of the Australian Defence Force Afghanistan Inquiry Report (the Brereton report) observed that Australia’s extensive use and reliance on Special Forces to conduct largely conventional roles in Afghanistan contributed to some of the issues that arose out of the report:
Australia requires a more surgical and refined national Special Forces capability than that required for the more or less conventional operations into which SOTG operations in Afghanistan evolved. The sustained use of Special Forces to conduct what were in truth largely conventional operations meant that the limited pool of Special Forces personnel were required to deploy on multiple rotations, with little respite between deployments. It also denied conventional forces an opportunity to deploy and learn from the experience of operations for which they were trained and suited. While Government may have had an understandable preference for using Special Forces, because of their proved success in the past and the lower risk profile, it was the ADF’s responsibility not simply to accede to that preference, but to provide fearless and firm advice that the protracted use of Special Forces to conduct what were not in truth ‘special operations’, but missions that could have been conducted by appropriately trained and enabled conventional forces, was imprudent, unwise, and potentially jeopardising the welfare of Special Forces personnel.
5.19
Among 191 findings and 143 recommendations, , the Brereton report made the following:
The Inquiry recommends that Special Forces should not be treated as the default ‘force of first choice’ for expeditionary deployments, except for irregular and unconventional operations. While in conventional operations Special Forces will sometimes appropriately provide, or significantly contribute to, early rotations, the ‘handing off’ of responsibility to conventional forces, and the drawdown of Special Forces, should be a prime consideration.
5.20
The Brereton report suggests that the bulk of any future major combat operations conducted by the ADF should be conducted primarily by appropriately trained and experienced conventional forces and capabilities, as opposed to an unsustainable over-reliance on high-impact, low-risk Special Forces.
Family support
5.21
The Defence Annual Report 2019-20 states:
In 2019–20 Defence continued reform of its transition programs to provide tailored support to transitioning members and their families using a needs-based approach, including targeted support for at-risk members to achieve civilian employment or meaningful engagement.
5.22
In the case of serious illness in a Defence member’s family, there is leave available to support them—carer’s leave in the first instance and other longer-term leave options after that. Flexible working arrangements are also available, including working from home or working remotely, that can be used to support families. In operational units, for example on a ship, Defence employs social workers to assess family circumstances and can arrange compassionate postings out of operational areas into office-based roles.
5.23
The Defence Community Organisation (DCO) is also central to supporting Defence families. Some of the functions it provides include critical incident support and support to commanders dealing with compassionate postings. In the 2019-20 financial year, DCO received over 23,000 calls and 23,000 emails to the Defence Family Help Line. It also operates 25 on-base and 11 off-base community centres through which families can connect, network and support each other. DCO also partners with a contractor to run 16 long daycare centres and has 256 school transition mentors across schools where there are high proportions of children of service members.
Contractors, consultants and outsourced service providers
5.24
Defence’s uniformed workforce requires external supplementation to allow it to be available for operations and contingencies:
We have…aspects of our organisation that might be surging really hard, and we’ve got a number of our people deployed and trained to deploy, so we might need to leverage an external workforce to help us deliver capability.
5.25
Defence tracks its external workforce in three categories: consultants, contractors and all outsourced service providers. Outsourced service providers are the largest component of the external workforce. The last Defence census in March 2020 reported an external workforce of 32,487 full-time equivalent (FTE) staff within Defence. The Committee noted an increase in the external workforce and sought further information from Defence on why this was required.
Consultants
5.26
Defence engages consultants where it lacks specialist expertise or when independent research and assessment is required. The process for selecting consultants is consistent with Defence procurement policies and the Commonwealth Procurement Rules.
5.27
According to its March census, Defence had 314 FTE consultants. Consultants are engaged as specialists in the traditional sense. They are generally employed to work independently in very specific circumstances to apply their industry or specialist knowledge to provide reports or other specific outcomes. Consultants make up the smallest component of the external workforce.
Contractors
5.28
There were 6,810 contractors reported in the March 2020 census. The largest component within that figure work within Capability, Acquisition and Sustainment Group (CASG) in areas including information, communications technology (ICT) and project management. Contractors usually work under the direction of the organisation, under either a public servant or an ADF member. Some contractors are employed for short periods to cover workforce gaps or for particular short-duration activities. Others, particularly those with specialist skills in, for example, project management within CASG, can sometimes be employed on multi-year projects.
5.29
The contractor workforce provides flexibility when it is needed. It also provides access in the marketplace to technical skills and resources that Defence otherwise may be unable to provide internally.
5.30
The evidence received in this inquiry overlaps with previous examinations of Defence workforce including the 2012 Senate Foreign Affairs, Defence and Trade (FADT) Report on Defence Procurement Procedures and the 2014 First Principles Review. Both noted the critical importance of having people with the right combination of qualifications and relevant experience for Defence to be a ‘smart customer’ and manager of modern complex systems. The Senate Report noted the extremely high cost (in both dollars and capability terms) when Defence attempted to use process to compensate for a lack of competence in staff managing risk in the procurement and operation of defence materiel. They also noted the failed attempts to develop and sustain an ADF/APS workforce that has the scope and depth of requisite competence. In concluding that Defence has a legitimate requirement to engage external expertise, the report states:
The Committee notes Defence’s use of professional service providers as a means to obtain support for projects where there are no available APS or uniformed members qualified and experienced to fulfil the role. The Committee supports this approach and is concerned that due to financial considerations, Defence appears to be under pressure to replace such expert contracted support with APS staff regardless of their suitability for the role.
Outsourced service providers
5.31
Seventy-eight per cent, or approximately 25,000, of Defence’s external workforce are outsourced service providers. These are generally large, broad-spectrum companies engaged in large projects such as (for example) base development or submarine maintenance. The Defence ICT Help Desk is an example of a substantial outsourced service in which Defence has chosen to leverage industry to fill an important niche capability:
We’ve made a conscious decision that we want that whole function [ICT] done through an outsourced service provider.
Committee Comment
5.32
The Committee notes that the Australian Defence Organisation’s workforce is complex, specialised, and competes with a number of other sectors and industries in attracting and retaining the talent it needs to provide the capabilities required of it. This makes the recruitment, training and retention of the Defence workforce a key input to national security.
5.33
The Committee supports the conclusions of the Senate FADT 2012 Report and the First Principles Review which emphasises the value for money and capability imperative of employing people who are competent for the role. The Committee recognises that competence for the task should be the primary consideration for Defence together with relevant oversight by the Parliament. Where an ADF or APS member has the requisite competence for a given role they should be employed accordingly. The committee is concerned at pressure being applied on Defence to reduce externally engaged professionals without due consideration of the costs of developing and sustaining an ADF/APS workforce across all required domains or the impacts to capability of failed projects due to unqualified staff seeking to manage complex projects/capabilities on the basis of adherence to process alone.
5.34
The Committee is encouraged to learn that as military capabilities expand, particularly in space and cyber, the recruitment and retention models used by Defence will also expand in order to ensure that Australia can not only keep-pace in those domains, but to ideally be a world-leader. As a medium power with an advanced economy and world-class STEM and information and communications technologies (ICT) —in both education and industry sectors—the Government should seek to increasingly evolve its recruitment and retention strategies to maximise its strategic advantage in the region and across the globe.
Strategic approach
5.35
It is the Committee’s view that Australia’s changing geostrategic environment, coupled with the rise of ‘grey-zone’ tactics and the return of major-power political warfare necessitates a change in the Australian Defence Organisation’s focus and philosophical approach to a range of strategic challenges, including the nature of its workforce.
5.36
Australia is limited by population and GDP in comparison to other powers in its region but is advantaged geographically by its size and ocean-bound position, as well as its world-class STEM and ICT base. These, and other factors, put Australia in a strong position to become a world-leader in asymmetric approaches to national security across all of its aspects—not just the focus areas of this inquiry. In 2009, Australian Army Officer, then Colonel Chris Field (now Major General and Deputy Commanding General, Operations, U.S. Army Central) wrote a prescient paper on the topic of Australian national asymmetric advantage in which he asserts:
For the ADF to fight and win in twenty-first century conflicts, we must recognise that asymmetry is not the sole province of our enemies. We must take the fight to the enemy, and use our own national asymmetric advantages to greatest effect.
5.37
Twelve years on, David Kilcullen (Professor of International and Political Studies at the Australian Defence Force Academy), echoes Field’s sentiments in his recent ASPI article writing that Australian strategists must accept the challenge that Field posed in 2009:
[We] need to get out of the defensive crouch we have been in since the turn of the century, thinking of ourselves as conventional actors defending against an array of lurking unconventional threats…Instead of perpetually playing goalkeeper, we need a mindset shift to start seeing ourselves as the asymmetric threat.
5.38
The Committee believes that as the ADF adapts to its developing capabilities in the less conventional domains, including cyber and space, it should also adapt its workforce and its strategic approach to gain maximum operational leverage from these capabilities. This may require a shift in strategic thinking, within both Government and the ADF, towards resourcing and shaping the ADF not only as a highly capable conventional force, but also as a disproportionately potent force in grey-zone and asymmetric capabilities.
ADF size
5.39
In an increasingly contested Indo-Pacific, the Committee is concerned that as Australia’s main area of geostrategic interest has moved back to our region, the conventional forces of the ADF may not be suitable in size or capabilities to face potential emerging security situations. The Brereton report makes it clear that the bulk of any future major combat operations conducted by Australian forces should be conducted primarily by conventional forces. With a full-time force of only 58,600 (and a much smaller number of front-line combat personnel) the Committee is concerned that the ADF is too small to credibly field sufficient rotational combat forces for protracted high-end combat operations, either as a lead or contributing nation.
5.40
To be able to answer the question as to the adequacy of the size of the ADF, the question must be addressed as to what conflict the ADF is preparing for? Unless the ADF and the Government is able to answer that question, it cannot reasonably determine whether the current size of the ADF is appropriate and to what extent (if any) its numbers should be increased, given the current geostrategic environment.
5.41
The Committee recommends that the Government reviews the size of the ADF in order to ensure a more sustainable and credible conventional force is available for future military operations, particularly sustained operations.
5.42
The Committee recommends that the Government makes a shift in strategic thinking, within both Government and the ADF, towards resourcing and shaping the ADF not only as a highly capable conventional force, but also as a disproportionately potent force in grey-zone and asymmetric capabilities.