Michael Danby (Melbourne Ports, Australian Labor Party) Share this | Link to this | Hansard source

I am a bit taken aback. Mr Deputy Speaker, I am unused to seeing you there. I welcome you in your new capacity.

Tony Windsor (New England, Independent) Share this | Link to this | Hansard source

This is my first occupation of this chair.

Michael Danby (Melbourne Ports, Australian Labor Party) Share this | Link to this | Hansard source

Very elevated it is too, and I am sure you will fill it out very well. This report, Review of the Defence annual report 2009-10, looked at issues of the strategic reform program personnel, including the people in defence strategy; ADF pay remediation and mental health reforms; and justice and security, including military justice, security of our vital national assets in north-west Australia, Border Protection Command, ADF security, the Defence Materiel Organisation and others.

I am reticent to steal some of Dr Jensen's thunder on this because he is doing the official report as the deputy chair of the Defence Subcommittee but, as chairman of the overall Joint Standing Committee on Foreign Affairs, Defence and Trade, I want to share some of the concerns I know he will express about some of the evidence from defence department officials. I got the feeling from the people on the subcommittee that perhaps they could have been better prepared and more articulate. They seemed poorly briefed on a couple of occasions and their lack of preparedness was compounded by the delay in the provision of answers to questions taken on notice. We have very many active members of that subcommittee—Senator Furner in another place and Dr Jensen, who often do have very detailed questions. I am concerned that the strategic reform program seems to be a nice title for a reconsideration of some of the department's ways of looking at things, but I am afraid it is going to need deeper cultural reform. We have some very big procurements coming up, such as the joint strike fighter and particularly the submarine program. I am very concerned that the parliament, all members of political parties from both sides, as well as the department and whichever government is in office—because the plans of the defence department will take place over a very long period of time—are involved in making some of the big decisions that need to be made. There has been a great deal of public criticism of previous decisions, including the purchase of the Collins class submarine and some of the problems that have taken place because of, as the defence minister has said, insufficient planning beforehand. But we now have a projected $30 billion program, particularly with the submarine program, that I am most concerned about.

I want to use the occasion of this general review of the defence annual report to signal those concerns. We are sending a group from the defence committee together with the senate committee to the United States, Germany, the United Kingdom and Spain soon. I expect Dr Jensen and a number of other members—led by Senator Furner, Senator Bishop, Senator Stephens and Senator Johnston from the opposition—to make serious inquiries into the projected purchases of equipment, submarines, the joint strike fighter and many other military pieces of kit that the defence department is seeking to acquire.

I am particularly concerned about the submarine program in the light of the report ASPI made just recently. The Australian Strategic Policy Institute has indicated that there are other ways of approaching the necessity for protecting Australia's northern approaches other than the very expensive program that will come at the cost of other expenditures that the Australia government can make and other defence expenditures that it might make. Therefore, I am very pleased that this group is going overseas. It is a very serious investigation. I see the parliament as having a particularly important role in ensuring that these defence purchases, and the defence reports, are considered very seriously, as this one has been considered.

Dennis Jensen (Tangney, Liberal Party) Share this | Link to this | Hansard source

On behalf of the Joint Standing Committee on Foreign Affairs, Defence and Trade, I have pleasure in presenting the committee's document entitled, Review of the Defence annual report 2009-10. The review of the Defence annual report is an important task and an opportunity for the Defence Subcommittee of the Joint Standing Committee on Foreign Affairs, Defence and Trade to inquire into a broad range of defence issues as part of the process of accountability of government agencies to parliament. The subcommittee takes this responsibility very seriously.

The subcommittee took evidence from senior Department of Defence officials at a public hearing held in Canberra on 25 March 2011. The subcommittee selected a broad range of issues for examination at the public hearing. In broad terms, the focus area was the strategic reform program; personnel, including the people in defence strategy; ADF pay remediation and ADF mental health reforms; justice and security, including military justice; security of vital national assets in the north-west of Australia; border protection command and ADF base security; and the Defence Materiel Organisation, including reform and procurement projects of concern and specific projects. Due to the size and complexity of the defence department, the committee secretariat offered to assist Defence in its preparation for the public hearings on 25 March last year. Unfortunately, other than the secretary, the Chief of the Defence Force and those officers representing DMO, Defence officials seemed poorly briefed and ill-prepared for the hearing. This lack of preparedness was compounded by the delay in the provision of answers to questions taken on notice. Answers to questions on notice were provided some five months after the hearing. The committee therefore recommends that the Department of Defence review its practices and procedures to ensure that answers to the committee's questions on notice are provided in a more timely manner.

Documentation and hard evidence on the outcomes of the Strategic Reform Program were hard for the committee to find. There is a difficulty in an organisation as big as Defence of tracking savings. The committee therefore spent much of its time questioning Defence on its idea of a cost-conscious culture. The committee acknowledges the difficulty in any organisation creating cultural change. However, the committee is concerned that Defence will not be able to institute the cost-conscious culture necessary not only for the SRP but for the Defence organisation long past 2030. The SRP relies more on cultural change than rigorously costed savings plans. Creativity and innovation should be the norm in any department. Labelling this as some kind of new and special program is illusory.

The committee looked into base security and is concerned that at the time of its public hearing some 20 months after the threats to Holsworthy barracks, the defence department is only very slowly moving towards decreasing the threat level of its bases.

In relation to the Defence Materiel Organisation, whilst heartened by the establishment of the independent project performance office, the committee is concerned that this must not become another level of bureaucracy that hinders rather than helps the performance of DMO.

Lastly, I want to make comment on the joint strike fighter. At the time of writing, the committee had three main concerns regarding the JSF: cost, schedule and capability. Additionally, I am highly concerned as to the capability or lack thereof of the JSF and am concerned that there has never been a process of conducting an analysis comparing contenders, nor has there been an open capability requirement in evidence which the new air combat capability should fulfil. Indeed, Defence is comfortable with the idea of simply reducing the number of airframes to fit within a specified budget. If reducing the number of airframes is possible while meeting whatever the capability requirement is, why bother with the additional number of airframes in the first place? This highlights what in my view is one of Defence's inadequacies.

These are some of the issues that the committee will be pursuing in its review of the Defence annual report 2010-11, an inquiry that is currently underway. I commend the report to the House.

Debate adjourned.