Richard Marles (Corio, Australian Labor Party, Shadow Minister for Immigration and Border Protection) Share this | Hansard source

Thank you, Minister, for the correction. Let me start by saying that, when it comes to the area of defence industry and indeed defence, what has characterised this government since it came to government in 2013 has been total confusion. Let us start with the number of ministers: we are now onto the third Defence minister. We had Minister Johnson, Minister Andrews and now Minister Payne—although, we will get to this a bit later, it does seem as though we have now got two ministers for Defence; although exactly what the order of seniority in respect of those two appears to be unclear, however, with the Minister for Defence Industry here, he may be able to answer that question.

We have had a number of assistant ministers—Assistant Minister McCormack, Assistant Minister Chester and Assistant Minister Robert—go through the portfolio. We now have Minister Tehan operating in the space. This has been a merry-go-round in terms of who has been representing the government in this space.

The confusion goes beyond that. What characterised again in respect of the question of procurement is a complete failure of a strategy around exactly where this government wanted to take procurement. If you look at the question of submarines—and there are a number of questions that need to be answered here by the government—we had Minister Johnston referring to Australian shipbuilders as unable to build a canoe. We had, in the course of the leadership contest with the former Prime Minister Abbott, the single largest procurement in Australian history being tossed around the government party room as a matter of collecting votes to save Mr Abbott. Out of that came the competitive evaluation process, which was a process unknown to Defence at that point in time and still cannot really be explained as to what it was about.

We indeed saw this procurement ostensibly be a part of the clinching of the Japan free trade agreement as it seemed that the government was destined to put this particular procurement in the hands of the Japanese. Then we ended up where we are now with the design being done by DCNS from France.

We have seen in relation to supply ships—this was going to be the most important procurement in terms of maintaining Australian shipyards so that they could survive the valley of death; however, rather than this being done within Australia, because the government at the time was saying that Australian capability was not such that this could be done within Australia, we see tenderers for this work being exclusively outside of Australia, and now that work is being done in Spain.

The serious point of all of this of course is the loss of jobs—1500 shipbuilding jobs have been lost as a result of these decisions that have been made since the Abbott-Turnbull government came to power. I think the other point to make is that, in the context of a significant increase in procurement, we have been over the last few years something in the order of 10 per cent of US foreign military sales and something like the 7th largest defence importer in the world . That speaks to the significant expenditure which is occurring in this area and yet, despite that, there has been precious little effort on the part of this government to leverage that expenditure to build a domestic defence industry. That would appear to be the reason why the minister was called in to save the day, and we now have two Defence ministers—a Minister for Defence and a Minister for Defence Industry.

There are a number of questions which need to be answered in respect of the procurement space. The number of shipbuilding workers in Australia has gone down to a critical level. The OPVs are scheduled to be steel cut in 2018, the Future Frigates in 2019. I guess the first question that I ask the minister is: has a preferred design partner been chosen for both of the those projects? And, if it has not, when is it intended to be so and can there be certainty that the dates in respect of cutting steel will be met?

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