Zoe Daniel (Goldstein, Independent) Share this | Hansard source

I want to preface what I'm about to say on the Defence Amendment (Safeguarding Australia's Military Secrets) Bill 2023 and the related bill by stating that I don't begin this speech with an ideological mindset against AUKUS. I well understand the arguments for it, particularly in the world in which we live today. On that basis I welcome the opportunity to speak on these bills, because I think that, as a nation, we need to have this conversation. I will say this: for a project with the eye-watering price tag of $368 billion, we are asked to accept an awful lot about AUKUS as an act of faith: that Pillar II of AUKUS, the subject of this legislation, in effect, will provide the benefits to Australian research and industry predicted by the government; that the US can reboot its industrial base sufficiently to build the submarines promised to Australia; that the US Congress will agree to the sale of two or three of its own subs to Australia as the US struggles to build new subs at a rate to match its own strategic priorities; that Australia has not implicitly undermined national sovereignty in signing up for AUKUS; that the US Congress will agree to sell Australia the first two or three subs without an express commitment to join Washington in conflict with China over Taiwan; that Australia can develop the workforce with the expertise required to develop a nuclear submarine from scratch in the short time frame required; that a small force of nuclear submarines could do what a larger and cheaper force of conventional submarines could not; and that a handful of expensive nuclear subs will prove to be a deterrent, protecting Australia's vital shipping lanes.

Former prime minister Scott Morrison is also a former marketing man. In keeping with that, the big question about AUKUS has always been whether there's less to this megaproject than meets the eye; that it's more about marketing than delivery. And that goes for Pillar II, as well as for the subs themselves. I've met officials, for example, from an Australian defence technology company whose cutting-edge technology has been sought by a major US defence contractor, but the Australian company can't get its foot in the door because of current American restrictions. In theory, one of these bills at least is designed to address that constraint, but there are concerns that it could make it worse by creating a rigid two-way market which the US has outsized power over, while preventing such companies from doing their business with other countries. In short, to get a piece of AUKUS Pillar II, Australian companies will have to sign up to incredibly rigid restrictions and then hope the Americans give them the contracts.

There are also fears in industry that the history of our own defence department is such that even with these new provisions in place, in general it's more content to buy stuff from overseas, and the US in particular, than in encouraging the development of a sovereign Australian defence capability. A cynic might say that the surprise AUKUS announcement at 7 am on 15 September 2021 was more about wedging Labor and escaping the increasingly embarrassing questions about the viability of the troubled French submarine project than about the long-term consequences in terms of cost and strategic effectiveness. Greg Sheridan is no China dove, quite the opposite in fact, but in the Australian late last year he wrote this:

For the government, the AUKUS subs are a magic pudding, so far away you don't have to spend any more money on them, and so impressive sounding they convince people you are doing something on defence when you are doing nothing. And if a few lefties complain, all the better, but it still produces no defence capability over the next 10 years and quite possibly nothing after that either.

Sheridan is not alone. Michael Shoebridge is the former director of ASPI's Defence, Strategy and National Security program. Last November he wrote this:

In a different world, where Defence was meeting its core obligations to provide cogent, well-founded advice to support government decision making, we would expect that there had been a proper analysis of alternative ways of increasing Australia's deterrent capabilities and long range strike against the backdrop of a dangerous region centred on an aggressive China.

But it is almost certain that this did not happen in the lead up to the AUKUS announcement.

No wonder doubts persist, not just about the financial wisdom but also the strategic wisdom to the AUKUS initiative.

Hugh White has never been a fan of the hawks who believe that Australia's security depends on the United States maintaining its strategic predominance in the western Pacific. Indeed, he has argued and continues to argue that AUKUS may fail to materialise, and even if it does, it may leave Australia more strategically vulnerable than less. He also has some cogent points to make about Pillar II, again, the subject of at least one part of this legislation. The minister, in his second reading speech, declared that the measures in the bill are expected to provide a net benefit to the Australian economy of $614 million over a 10-year period. In a recent article in Australian Foreign Affairs, White was far from convinced, declaring:

It is naive to expect that the easing of some legislative constraints on Australian participation in US defence procurement will send a flood of work our way… In the highly politicised world of defence contracting, our AUKUS partners will always bend over backwards to keep this work at home… Defence industry integration is more likely to mean that work on Australian projects will flow to America and to Britain than the other way around.

And White does have some bona fides in this area. He was high up in the defence department under both Labor and coalition governments, and one of the authors of the 2000 Defence white paper which first raised official concerns about China as a long-term security threat. In his recent essay, he also notes the historical fact that more expensive new tech does not necessarily win wars. More low-end equipment is arguably more effective.

Anyway, not for the first time, we are being asked in this House to vote on legislation drafted before a parliamentary inquiry—on this occasion by the Senate Foreign Affairs, Defence and Trade Legislation Committee—is complete. The committee offered several recommendations in line with concerns expressed both by Australian industry and the research community. The committee recommended that the definition of 'fundamental research' at the heart of the legislation be placed in the bill itself. Also, it was recommended that there be further consideration given to the exact definition of the term 'Australian persons', which would determine whether a researcher, for example, would be acceptable under the terms of the Defence Trade Controls Amendment Bill 2023. In particular, the committee recommended that the definition is consistent with defence trade controls in the US that provide for exemptions of foreign citizens of states subject to Washington's sanction, regardless of their American residency status. As former Chief Scientist Ian Chubb noted in evidence to the committee:

While the proposed new legislation does result in some lightening of the red tape regarding science conducted with colleagues in the US and the UK, potentially, it also raises the bar for the rest of the world, including long-term collaborators in Europe, Southeast Asia, Oceania and the Americas.

And that's at a time when Australia can't get all the STEM expertise we need from the AUKUS nations alone.

We run the risk of passing a piece of legislation that, while it looks beneficial on the surface, makes matters worse because it could exclude expertise from non-AUKUS sources while making us even more dependent on the US defence sector, which is notoriously inward looking and subject to the parochial demands of individual members of Congress. It's not necessarily a criticism of the Americans; it's simply reality.

I now understand that the government has been consulting with stakeholders in the research community about these provisions and plans to alter the legislation with the intention of addressing these issues. I look forward to seeing what the government proposes and whether any changes fully address concerns. I will otherwise move a series of amendments later to address these issues.

In recent days we've seen the Pentagon playing into concerns about whether AUKUS can ever deliver what Scott Morrison promised and that the current Prime Minister rushed to accept for fear of being wedged in the lead-up to the last election. This rare bipartisanship, ironically, is less than ideal in this case, I believe, because—as I alluded to at the start of this speech—it has meant that there's been very limited tolerance for debate and discussion about the finer points of this deal. As part of its game of fiscal chicken with Congress, the Pentagon has proposed a budget that would see just one nuclear submarine off the production line next year, compared with the figure of 2.3 that the US Navy says would be needed to ensure that enough subs are produced to meet Washington's AUKUS commitments as well as its own requirements.

The question is whether the US Navy had been blinded by reality, given that the official Congressional Research Service reported in December:

… the submarine construction industrial base is currently able to build them at a rate of about 1.2 to 1.3 boats per year, resulting in a growing backlog of SSN—

that is, nuclear submarine—

construction work.

The report goes on to say:

If the Navy is not able to achieve an SSN construction rate of 2.33 boats per year, then replacement boats … could enter service with the US Navy later than indicated … or perhaps not be built at all.

The question then becomes this: if that is the reality, what actual chance is there of Australia getting the subs that it's been pledged in the time frame promised, protracted as it is, or, indeed, ever? What does that mean for AUKUS Pillar II, which is at the centre of this legislation? Those questions exist without even considering the prospect of what would happen should Donald Trump return to the White House with a declared and inward-looking agenda of America first.

See this speech in context