More force to Defence

Adelaide Advertiser, 21/05/2011

While we were all celebrating Christmas two years ago a young Australian Private was shot through both legs in a fire fight in Afghanistan. His mates dragged him 600 metres through an irrigation ditch to a waiting Bushmaster vehicle. The Bushmaster got him to a helicopter, and the helicopter got him to the doctors waiting at the base in Tarin Kowt.

When I met him last year it had a big impact on me. He reminded me how important the work is that Defence and the Defence Industry do. He survived because of three things – his mates, the training they received and the equipment we provide them with.


South Australia plays a big part in this. About a quarter of the Australian Defence Industry is here in South Australia – and its future is bright.

Right now 1,000 South Australians are maintaining our submarines. More than 700 are maintaining and upgrading our surveillance aircraft. There are 1000 scientists, researchers and engineers at DSTO in Edinburgh working on the next edge for our troops, and across the road 600 soldiers from 1st Brigade have just relocated from Darwin. One of them is that young private.

South Australia is also the home of Australia’s biggest Defence project – three Air Warfare Destroyers worth nearly $8 billion. There are already more than 800 South Australians working on this project – cutting steel, building hull blocks and the combat system – and this workforce will keep growing as production peaks over the next few years.

In the next 10 years Defence will spend more than $150 billion on the acquisition and maintenance of Defence equipment. The amount we spend in Australia is expected to jump from about $5.5 billion a year to $7.5 billion by the end of the decade. That means more jobs for the Defence industry – and that’s good news for the Defence State.

There has been a bit said about the Defence budget in the last two weeks. A few important points:

1. The budget cuts back on public servants – there is no reduction in our military workforce.

2. Our most important job is to support the troops we have sent into harms way. The budget allocates $1.9 billion to fund our troops in Afghanistan, East Timor and the Solomon Islands next financial year. We have allocated $1.6 billion to provide our troops with more protective equipment like lighter combat body armour, extra protective armour on their vehicles and heavier calibre weapons.

3. There have been some suggestions that plans for a fourth Air Warfare Destroyer have been ‘scuttled’ in the budget. Let me clear this up. Four years ago the former Government announced the construction of three ships – and that is what we are doing.

4. None of the key Defence White Paper projects – including the 12 Future Submarines to be assembled in South Australia – are affected by the budget.

5. Some funding for Defence projects has been pushed back. Most of this is because we have projects running late. Projects like our new early warning and control aircraft, the helicopters that will replace our Blackhawks and the new tankers to refuel fighter planes in the air, are behind schedule. The companies delivering this equipment are paid when they meet certain milestones. Because they are behind schedule they don’t receive these milestone payments and the money is pushed back into the next few years.

This hits on a big issue. One of the biggest challenges Defence faces is delay. Off-the-shelf equipment is usually delivered on time. If we order equipment that has to be modified or customised for the ADF it is delivered, on average, 23 per cent late. If we order equipment that has never been built before it arrives, on average, 66 per cent behind schedule.

On average major defence projects in Australia are delivered 20 per cent late. That’s better than the US and the UK. But that doesn’t mean the current situation is good enough.

There is a lot more we can do to make Defence more efficient and improve the acquisition and maintenance of equipment. The Minister for Defence Stephen Smith and I announced the first stage of this a few weeks ago. This includes requiring Defence to do a cost benefit analysis if they recommend Government does not buy a piece of equipment off-the-shelf. It also includes an early warning system that is triggered if a project starts to fall behind schedule. The earlier we get this information the earlier we can take action to fix the problem.

This is just the start. There is a lot more work to do. Over the next few months we will be rolling out the next stage of our reforms to Defence. The results will be good for taxpayers and, most importantly, good for the young Private who now calls Adelaide home.