Warren Snowdon (Lingiari, Australian Labor Party, Minister for Defence Science and Personnel) Share this | Hansard source

Let me first go to the general issues which were raised and the specific questions which were raised by the shadow minister. Obviously the decisions were made in the budget process through the ERC process in a timely fashion prior to the budget. As he rightly pointed out, there is $4.45 million worth of savings across the forward estimates, including a contribution of $971 million in 2012-13.

I do want to make a couple of points just so that we understand the nature of these cuts. The contribution will have no adverse effect on operations in Afghanistan, East Timor or the Solomons, and I think that is commonly understood. It will not have any impact on the provision of defence equipment, defence personnel and operations. They will not be adversely affected, as you would expect. There will be no adverse impact on the number of ADF personnel engaged within the services. What we are doing is looking at the impacts of some of the reform—the strategically reform processes—and making sure that the impacts on entitlements to ADF personnel are being minimised. I understand that would be an issue which you will probably raise. I am happy to talk about that in more detail later.

I think I need to make the observation and the point that there has been no fundamental change to our defence budget from a strategic perspective. That is vitally important if we are to understand where we are going here. In 2009-10, the budget for the government for the first time was over $100 million for defence. That was across the forward estimates. In the 2011-12 portfolio additional estimates, the defence budget across the four-year forward estimates period was $103.4 billion. The budget this year is $103.3 billion. This level of funding will maintain Australia's status in the top 15 nations in the world of defence expenditure. We will continue to be the second on the list of military expenditure per capita, with only the United States spending more. So we need to understand that perspective.

The opposition spokesman has asked me about savings through the Defence Capability Plan since the 2009 white paper. I just want to preface this. I do not necessarily want to have a political dialogue which is about animus, but I do still want to make a couple of observations. This is a $5.4 billion save over the forward estimates. It is for a particular reason which is well known to the parliament and the people of Australia: to get us into surplus. We were asked to make a contribution. We are making a contribution, but the significant question—and this is something which I know the opposition spokesperson will take on board, and I would like to think he could tell us what is happening—is: are the opposition committed to these savings? The real question, apart from the dialogue we will have about the capability development plan, is whether or not the opposition are committed to these sort of savings—or are they going to say they are not going to proceed? If they are going to say that, they have got to tell us where the money is coming from. We already know there is a $70 billion black hole. What they need to be able to tell us now is: if they do not want to support these savings measures, where will the money come from? It is a very simple but very important question which needs to be asked. Let me go to the issue of the Defence Capability Plan.

There were 180 capability projects in the 2009-2019 defence capability plan that underpin the 2009 defence white paper. Fewer than 10 projects have been scrapped as a result of revisions the DCP. The vast majority remain in the program today. (Extension of time granted) Since the 2009 white paper, government has approved over 100 first or second pass and other approvals, including studies, risk reduction activities, capability technology demonstrations and project development funding with a total value of nearly $13.5 billion. This includes the first 14 Joint Strike Fighters, 24 naval combat helicopters, over 900 additional G-wagon trucks, seven CH-47F new Chinook helicopters and two more D model Chinooks, military satellite capabilities, counter IED equipment and systems, new 155 millimetre towed artillery systems, and communication equipment. In 2011 the government made a record 49 approvals of capability projects. The previous record was 37, in 2006. The government has also allocated funding for essential new capabilities not envisaged in the 2009 defence white paper, including the new amphibious heavy lift ship HMAS Choules and the interim humanitarian disaster relief ship MSV Skandie Bergen, two additional C17 heavy lift aircraft for a total of six, and 101 more bushmasters with further orders likely. We remain committed through this budget, and this is apparent in the budget papers, to the core capabilities as outlined in the 2009 defence white paper, including 12 future submarines—I will come to those more specifically in a moment—the joint strike fighter and the replacement for the caribou aircraft.

I will respond to my colleague's questions about the submarines. Earlier this month the Prime Minister, the Minister for Defence, and the Minister for Defence Materiel, Jason Clare, announced that the government would provide $214 million—and I am sure this will be supported by the opposition—for the next stage of the future submarine project. The funding will go towards further detailed studies and analysis to inform the government's decision on the design of Australia's next submarine. The future submarine project is the biggest and most complex defence project Australia has ever embarked upon. It means work for hundreds of Australian companies and thousands of Australian workers, including boilermakers, welders, electricians, naval architects, engineers and many more.

I have a question again for the opposition. Are they committed to this project? Are they committed to having these vessels built in Australia? We know that the shadow treasurer on Channel 7 during the week of the budget said that they want to see what the benefit is in building the submarines here in Australia rather than getting cheaper versions from overseas. I think it is quite important that we understand, through this discussion we are having here, what the government is committed to and what the opposition is committed to. We have announced these savings, which are big, but at the same time we have made our commitment to the future development of Australian defence capability—including submarines—very clear. Clearly we want to see them built here in Australia, and we have maintained our commitment all along. I ask the opposition, if they can, to tell us what their position is.

The member asked me about defence housing. I would like him to tell us where that has come from. Are you talking about Defence Housing Australia, not the housing for single people that we are providing on bases—

See this speech in context