Christopher Pyne (Sturt, Liberal Party, Leader of the House) Share this | Hansard source

Please do.

ASC s eparation

To that end, in mid-October the government also announced the structural separation of ASC into three entities. These three new companies will support the key capabilities of shipbuilding, submarine sustainment, and infrastructure. The separation of ASC will deliver a more flexible approach to managing the investment required in shipbuilding infrastructure to support the government's historic continuous shipbuilding program. The new submarine sustainment and shipbuilding companies will continue ASC's important role in the sustainment of the Collins class submarines and the finalisation of the air warfare destroyers respectively.

The creation of these three new companies follows a strategic review of the ASC, which was conducted in 2015. Work has already begun on the separation of ASC into the three new companies, with full separation expected to be completed by June 2017.

International visits

In my first international visit as the Minister for Defence Industry, I visited the United States and the United Arab Emirates. I met with key defence officials in Dubai to highlight the capacity and capabilities of our defence companies. In the US I had the pleasure of meeting with the key defence companies operating in Australia as well as Pentagon officials, including the then US Secretary of Defense, Ashton Carter, to sell the merits of Australian defence industry.

The recent US election has seen a President elected who during the campaign committed to a massive expansion of around half a trillion US dollars to their defence budget. This result could bring with it an expansion of opportunities for Australian defence companies.

Joint Strike Fighter maintenance and sustainment hub

Following my visit to the US, I was pleased to announce on 7 November that Australia had been successful in the first round of assignments for work maintaining the componentry of the global fleet of Joint Strike Fighters. Successful companies include HI Fraser, which is located in the member for Mackellar's electorate, and Rockwell Collins Australia, which is located in the member for North Sydney's electorate.

The award of this contract acknowledges that Australia has the skills base and capacity to take on one of the most technically complex and expensive defence projects ever produced, as a maintenance and sustainment hub for the Joint Strike Fighter aircraft operating in the Asia-Pacific. This places Australia as the regional hub for maintenance, repair, overhaul and upgrade for the Joint Strike Fighter fleet, potentially bringing hundreds of millions of dollars and supporting hundreds of Australian jobs for decades to come.

Just this morning I had a phone call from the newly appointed Secretary of Defense, James Mattis. In the call I congratulated Secretary Mattis on his recent appointment and noted his keen interest and personal history working with Australia. I expressed my enthusiasm and strong desire to work closely on our shared defence interests as a key ally of the United States. Secretary Mattis reiterated his strong support for the Joint Strike Fighter program as a key strategic capability for the United States and allies across the globe.

We talked about the fact that the price for the lot 10 of the Joint Strike Fighter has been recently announced and has dropped below $100 million for the first time. For Australia this is hugely significant and represents a 25 per cent reduction from the price of the fighter in 2014, showing the program is on track in terms of delivery and efficiency.

Poseidon a ircraft

On 16 November, I, along with the Prime Minister and the Minister for Immigration and Border Protection, took delivery of the first of 12 P-8A Poseidon aircraft. The Poseidon is at the cutting edge of military technology. These aircraft will support a full range of tasks, including antisurface and antisubmarine warfare; maritime and overland intelligence, surveillance and reconnaissance; electronic support; as well as providing a search and rescue capability. Operated from RAAF base at Edinburgh, this will create more than 35 highly skilled jobs in South Australia.

Centre for Defence Industry Capability (CDIC)

The government is also committed to working with industry to build our innovation potential and ensure Defence maximises its opportunities to develop cutting-edge technologies. In December last year I opened the Centre for Defence Industry Capability, which has been funded at $230 million over the decade, a close collaboration between the private sector, Defence and AusIndustry. It is headquartered in Adelaide. The CDIC is designed to have a national reach to ensure flexible access for industry across Australia.

At the same time I opened the Defence Innovation Hub. The new $640 million innovation hub will bring together Defence, industry, academia and research institutions to collaborate on innovative, creative and cutting-edge technologies that can deliver better Defence outcomes.

We will also invest $730 million over the next decade in the Next Generation Technologies Fund (NGTF). The NGTF will provide opportunities to better position Defence to respond to future strategic challenges and develop the next generation game-changing technologies and capabilities to enhance national security into the future. I will be making more announcements about this new funding in early 2017.

Closing

As you can see, we are getting on with the job. This government has put the defence of our nation and the building of our defence capability at the very centre of our national policy agenda. We are determined to use the Defence dollar—$195 billion over the next decade—in building capability, to assist in transforming our economy, driving and growing local jobs.

In spending this it is critical that we get maximum value for money, that we learn from the mistakes of the past. Projects like the Air Warfare Destroyer, which was taken back from the brink by this government, must not be allowed to happen again. In the future we will use world's best-practice manufacturing and shipbuilding techniques to ensure success.

This will mean that we will not just hope that our processes and systems work, but rather that they are tried and tested. This will be through utilising a range of cutting-edge techniques including 3D planning, building a prototype ship of the Future Frigate and ensuring that the workforce are trained to the highest standards.

The government will do this while meeting the time frames that we have committed to and creating the jobs that we promised to deliver. The Offshore Patrol Vessel project will start in 2018 at Osborne in South Australia before it moves to Henderson, WA when the Future Frigate project starts. It will create more than 400 jobs. We will 'cut steel' on the Future Frigate project in 2020, as we promised, which will create 2,000 jobs at Osborne. The Future Submarine project will start in the early 2020s and will create 2,800 jobs—5,000 jobs at Osborne alone.

After years of Labor's neglect, we recognise that Australian industry is crucial to maintaining and developing the future ADF. Good relationships with industry are fundamental to developing a sovereign defence capability and that is why we are seeking to build closer ties between the military and industry—this will provide innovative solutions and capabilities to the ADF, and it really is happening. The reports from the industry and from Defence show there is a completely new buzz in the defence industry in Australia.

Currently 25,000 Australians are employed in the defence industry, and there are over 3,000 small to medium enterprises all around our country—they provide essential capability, services and support to the ADF. So we recognise the importance of this national endeavour. There is no time to waste in implementing it, there is no opportunity that should be ignored and there is no limit to what the Australian defence industry can achieve with the right business framework and appropriate government advice and support.

This government under the leadership of Prime Minister Turnbull will ensure that the growth of the Australian defence industry as a national enterprise in providing defence capability for the protection of our nation also becomes one of the most important industrial sectors in our national economy.

See this speech in context