Phillip Thompson (Herbert, Liberal National Party, Shadow Assistant Minister for Defence) Share this | Hansard source

I move:

That this House:

(1) notes:

(a) Australia is facing the most complex set of strategic challenges since the end of the Second World War;

(b) the importance of a strong and capable sovereign defence industrial base to ensure we can respond to these strategic challenges without overreliance on international partners; and

(c) the failure of this Government to take meaningful action over the past two years to grow Australia's sovereign defence industrial base;

(2) acknowledges industry research which shows;

(a) only one in four (25 per cent) of defence businesses are 'extremely' or 'very' confident that their existing or upcoming contracts will continue as planned over the next 12 months; and

(b) 47 per cent of defence businesses believe it is 'difficult' or 'extremely difficult' to operate in Australia's defence sector, including 64 per cent of small businesses and 48 per cent of medium enterprises; and

(3) calls on the Government to urgently implement a policy framework and industry support to build our industrial self-reliance with Australian defence industry primes and successful small and medium enterprises.

It's now a number of years in this place that we've been talking about our nation's strategic challenges. It's widely accepted that Australia is facing the most complex of strategic challenges since the end of the Second World War. It was a finding in the Defence Strategic Review and one which the coalition supports. That is why I brought this motion before parliament today. If we are really at risk of facing a conflict within the next decade, if the 10-year window of warning has really passed then the Albanese Labor government has a lot of work to do when it comes to growing our sovereign industrial base.

A robust sovereign defence industrial base in this country is absolutely critical to our national security. We need the guardrails in place to ensure that if the worst were to happen that we are not over reliant on our international partners. We know how difficult it can be when supply chains are affected by unexpected interruptions. We saw this during the pandemic with masks and vaccines and we are seeing it in the Red Sea right now. We know how difficult it can be if we don't have enough of a skilled workforce to deliver the labour we need across a range of industries.

Defence is not immune to these factors; in fact, it can be argued that it is even more exposed. That has only become even more of a concern due to last two years of inaction by the weak leadership of the Albanese Labor government. Let's have a look at what the government has done thus far. Well, they commissioned a review and produced a report called the Defence Industry Development Strategy. This report has sought to provide a new definition for our sovereign industrial base, one which needs to move beyond the narrow lens of solar-using Australian owned businesses.

I know not everything can be produced by Australian-owned companies but what is the new definition of Australian sovereign defence industrial base according to this report? It is businesses with an Australian based industrial capability with an Australian business number. That's basically it. If you have an ABN, you are sovereign. Deputy Speaker Georganas, do you know who has an ABN? Huawei, Hikvision, companies we have banned from providing certain products to the government because of security concerns. As Michael Shoebridge said, it means Northrop Grumman is as sovereign as Bega cheese and Vegemite. Northrop Grumman is an American company. How do we think this looks to a 100 per cent Australian-owned sovereign company that exists to provide capability to the Department of Defence?

The former coalition government made it a priority to invest in companies which were taking this seriously with the sovereign industrial capability priority grants. This was for small-to-medium enterprises to assist them to invest in projects to build our sovereign capability. The program was axed by the Albanese Labor government, and we're still waiting on details of a replacement program. So that's a gap in time and an opportunity missed.

But, in the meantime, the government could be doing so much more to make it easier for SMEs to work with the Department of Defence. The motion before the chamber mentions agile market intelligence research commissioned by Defence Connect, which doesn't paint a good picture. There's a lack of confidence and a lack of clarity when it comes to Australian businesses working for Defence. Only one in four defence businesses are confident their existing or upcoming contracts would continue as planned over the next 12 months. Sixty-four per cent of small businesses believe it is extremely difficult to operate in Australia's defence sector. Forty-eight per cent of medium enterprises also believe the sector is difficult or extremely difficult to operate in. I'm disappointed to say that it's something I've heard echoed in Townsville, Australia's largest garrison city. I've got a veteran owned and operated sovereign business that have supplied amazing capabilities to Defence that have pulled out. They're sick of roadblocks, they're sick of the red tape and they're sick of indecision. It sounds a lot like this Labor government's approach to defence in general.

With a threat imminent, we must be doing better. We need to see Australian companies with their headquarters and operations here and a government that implements policy to build our industrial self-reliance, because what we're seeing now is that this is not occurring. We should have business confidence within our defence industry sector. They don't have it. We don't have a defence industry minister who speaks to the defence industry, and he doesn't show up to Land Forces—doesn't show up when he needs to be counted. I commend this motion to the House.

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