Chapter 1Performance of the Department of Defence in supporting the capability and capacity of Australia's defence industry
1.1On 21 June 2023, the Senate Foreign Affairs, Defence and Trade Legislation Committee (the Committee) established an inquiry, for report by the final sitting day of March 2024, into the performance of the Department of Defence (Defence) in supporting the capability and capacity of Australia’s defence industry. On 28 February 2024, the committee resolved to extend the reporting date to 28 November 2024.
Terms of reference
1.2The inquiry’s terms of reference are as follows:
Pursuant to Standing Order 25(2)(a)(v), the Committee resolved to inquire into the performance of Defence in supporting the capability and capacity of Australia’s defence industry, with particular reference to the department’s:
(a)support to Australia’s defence industry in meeting the current and future needs of the Australian Defence Force (ADF);
(b)role providing and supporting opportunities for adjacent industries to contribute to the sustainability and viability of Australia’s defence industrial capability;
(c)work to address the reliance of Australia’s defence industry on inputs, be they tangible or intangible, from abroad and key capabilities that could form the basis of targeted exports;
(d)assessment and response to the risks that interruptions to supply chains may present to the ready access to such inputs and the benefits of producing defence industry outputs in Australia;
(e)role in enhancing Australia’s defence industrial base by pursuing greater advanced scientific, technological and industrial cooperation through AUKUS and other defence partnerships;
(f)design and implementation of programmes and initiatives that seek to improve the Australian defence industry’s capability and capacity; and
(g)any other related matters.
Conduct of the inquiry
1.3Details of the inquiry were made available on the Committee’s website. The Committee also contacted a number of organisations and individuals inviting written submissions by 14 July 2023. The Committee reopened the inquiry for submissions following the tabling of its interim report.
1.4The Committee published 47 submissions, as listed at Appendix 1. The Committee also received a number of form letters outlining a consistent theme, an example of which has been published on the Committee’s webpage.
1.5The Committee did not hold any public hearings.
Acknowledgements
1.6The Committee would like to thank individuals and organisations for their interest and engagement with the inquiry, including those that made submissions.
Interim report
1.7The Committee tabled a substantive interim report on 19 October 2023. The interim report outlined a number of matters for further examination in its recommendation, including:
how sovereign capability should be defined in Australia and which priority areas Australia ought to maintain and develop in order to strengthen its sovereign industrial defence base;
deficiencies in Australia’s defence procurement processes and how they can be alleviated;
how Australian defence industry’s existing sovereign capacity could be better measured and monitored;
how innovation pipelines can be improved and supported; and
any other related matters.
Committee view
1.8The Committee did not receive any further submissions after tabling its interim report in October 2023. The Committee however notes that work is in progress around recommendations made in its interim report. The 2024 Defence Industry Development Strategy is of particular note and goes a considerable way towards addressing the issues identified by this inquiry.
1.9Given the short time that has elapsed since the publication of the new Defence Industry Development Strategy, the Committee considers that it is too early to meaningfully assess its impact. The Committee encourages stakeholders to continue their engagement in this space and urges the Australian Parliament to continue to monitor the development of Australia’s sovereign defence capability and procurement processes.
Senator Raff Ciccone
Chair
Labor Senator for Victoria