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

Potential threat nations are objectively testing the evidence and have come to a very different conclusion compared to us about fundamentals of air combat. Noted defence commentator and presidential candidate Senator John McCain believes the Joint Strike Fighter is a 'great national scandal' and 'worse than a disgrace'. I echo the venerable senator's words.

Some of the current European fighters better meet the definition for fifth generation than Joint Strike Fighter, which lacks two of the critical measures. It is very interesting to note that, when the F22 first came out, Lockheed Martin defined 'fifth generation' as having the following characteristics: stealth, sensor fusion, supercruise or the ability to cruise at supersonic speed without using afterburner, and supermanoeuvrability. Unfortunately, the Joint Strike Fighter lacks two of these fundamental capabilities—supercruise and supermanoeuvrability. So, when a few years ago, in 2012, I asked Lockheed Martin at Fort Worth, 'How do you define fifth generation now?' they came up with a ridiculous definition of 'networks and survivability in contested airspace'. What the hell does that mean?

The unfortunate reality for Lockheed Martin is that Lockheed Martin does not define a generation; the generation is defined by the market. When you have a look at what the market says, when you have a look at the Russians, with their PAK FA aircraft, and when you have a look at the Chinese, with their J20 and J31, the simple fact is that those aircraft meet Lockheed Martin's original definition of fifth generation. In other words, they view supercruise and supermanoeuvrability as important. Problematically for the Joint Strike Fighter, in an era when, for the first time since the 1960s, tactical speeds in air combat are going up, because aircraft will more routinely be cruising at supersonic speed because of the ability of supercruise, the JSF needs to use afterburners to get to that speed, which lights up the sky in infrared and burns fuel at an incredible rate. But here is a further problem: the Joint Strike Fighter cannot open its weapons bay doors at supersonic speed. So, to shoot its missiles, it would have to decelerate to subsonic speed, then open the bay doors—and note that when the weapons bay doors are open the thing is not stealthy—and then fire its missiles. That is a great tactical disadvantage. The simple fact is these missing capabilities cannot be put into the design by modifications or upgrades; they are absent forever.

The term 'strike fighter' is little understood. In globally accepted terminology, the JSF would be a light bomber with some self-defence capability, which is why it was originally designed only carrying two AMRAAMs. Indeed, that was its design brief. For Australia there has been no defined strategic requirement for the Joint Strike Fighter, no identified capability gap, just a wish by the aficionados. This is no way to ensure that Australia's defence requirements are met and offer the best value for the taxpayer's dollar.

The correct way to come up with the best Defence Force structure is first to define your strategic requirements, or what you expect the Defence Force to be able to achieve against known capabilities of strategic competitors or potential adversaries. Then the focus must be on the capability you require, not platforms. So, once the capability requirements have been drafted, there should be consultation with industry. More particularly, there should be detailed analysis conducted to compare various options to fill the capability gap which compare various capabilities and contenders to fill that gap.

Fast forward 50 years, and we find the lessons of Vietnam have been forgotten. We now have a fighter similar to the original F4 Phantom which has excellent radar and all sorts of other sensors. It also carries four longish range air-to-air missiles internally, but no short-range missiles are carried internally. We are again being assured that dogfights are history and that the missiles will do the manoeuvring.

What has recently been found is that the JSF was comprehensively outperformed by the F16, designed 40 years ago. Indeed, the JSF was holding no weapons whatsoever; the F16 was carrying some external weapons and an external fuel tank. What happens when the JSF comes up against peer threats, and the missiles and stealth do not perform as advertised? They will not even have heat-seeking missiles, as they are carried externally; either they will carry those heat-seeking missiles, which will significantly degrade the JSF's stealth, or they can carry those missiles externally and not significantly decrease the stealth, then the stealth of the JSF is not what it is cracked up to be.

Sun Tzu, in The Art of War, stated that 'war is deception'—the idea is to deceive the enemy. Self-deception, almost by definition, aids and abets an enemy. Given Defence's capability gap on the issue of energy manoeuvrability of the JSF—and in this, they are either complicit or ignorant, and I am not sure which is worse—how do we believe them in terms of the 'secret' capabilities the JSF has? After all, anyone with even a small amount of technical ability in analysis would have been able to see that the JSF would not cut it in terms of energy manoeuvrability.

I welcome the recommendations of the First Principles Review to 'establish a strong strategic centre to strengthen accountability and top-level decision making' in Defence. I also welcome the fact that the committee responsible for the First Principles Review has committed to oversee the implementation of the First Principles Review.

Ann Sudmalis (Gilmore, Liberal Party) Share this | Link to this | Hansard source

The Defence Legislation Amendment (First Principles) Bill of 2015 is seen by many as an essential step to achieving stable Defence capability and a confirmed chain of command and responsibility. In speaking today, I would like to acknowledge the work of the research team in the Parliamentary Library. Primarily the purpose of this legislation is, quite naturally, to amend the Defence Act established in 1903, which now has sections that are both cumbersome and redundant. A brief overview includes a recognition of the Australian Defence Force as a single entity, a formal articulation of the authority of the Chief of Defence Force, and the role of the Vice Chief of the Defence Force as Chief of Defence's deputy. There is a removal of the statutory authority of the service chiefs in order to clarify the command and authority of the Chief of Defence.

We need to clarify of the status of our Defence cadets and we need to recognise the role of Defence Force Reserves. Over the past two years I have had the honour to meet members of our cadet units, including the Airforce Cadets—No.330 Squadron Shoalhaven, TS Jervis Bay and TS Albatross, our two local Navy cadet units. The young men and women in these groups are absolutely fantastic. These voluntary youth organisations are owned and sponsored by the Australian Defence Force. They participate in activities around the Shoalhaven, learning the skills and discipline associated with being part of such a group. TS Shoalhaven is now a unit of some 70 such wonderful young people. There are some amazing adults who mentor these young people, and I take this opportunity to thank the leaders John and Toni Huisman, Bill and Danielle Carter, Sharon and Andy Muzzell, just to mention a few. Many of these great cadets go on to join our Defence Force units, and we are all the better because of them.

This bill aims to implement the recommendations from the First Principles Review of Defence Force. It was the fulfilment of a commitment made by the coalition during the lead up to the 2013 federal election to 'undertake a first principle review of the departmental structure and its major processes'. The Minister for Defence announced the composition of the panel appointed to carry out the review in 2014 and, while doing so stated that the review would 'make recommendations designed to ensure Defence's business structures support the Australian Defence Force strategic plan to 2030'. The focus of the review was to make sure that the Australian Defence Force was fit for purpose, able to respond to future challenges and to deliver against its outputs with the minimum resources necessary. As such, the review team was given very broad terms of reference which, in addition to the structure of the Department of Defence and the Defence Force itself, also included the adequacy of materiel acquisition and sustainment practice to improve the efficiency and effectiveness of Defence overall. The government released the First Principles Review on 1 April 2015 and it agreed, or agreed in principle, to 75 of the 76 recommendations made in the report.

The review found there was a proliferation of structures, processes and systems with unclear accountabilities, which in turn caused institutionalised waste, delayed decisions, flawed execution and duplication, over-escalation of issues for decision and low-engagement levels amongst employees in parts of the organisation. The review proposed substantial change across Defence to ensure it can deliver on the future requirements that will be outlined in the government's forthcoming Defence White Paper. In the process of review, through extensive discussion and analysis, the effectiveness or otherwise of the current structure within Defence and the way it manages its core business were evaluated. The majority of the recommendations relate to matters of internal structure and practice, and implementation of most of them—including the re-integration of the Defence Materiel Organisation, commonly known as the DMO, back into the department as a part of the new Capability Acquisition and Sustainment Group—does not require legislative change. As a consequence, the majority of the recommendations do not need to be covered by the bill; they can be readily implemented. However those areas which require legislative change relate particularly to a key recommendation of the review, and that was to 'establish a strong strategic centre to strengthen accountability and top-level decision making' in Defence.

Another recommendation was to improve the flexible work arrangements in line with a number of recommendations contained in the Australian Human Rights Commission's review into the treatment of women in the Australian Defence Force. This recommendation was seen as a very relevant tool to increase the retention rate of women in our Defence Force. Last week we launched the White Ribbon campaign, where many Australians wear a white ribbon to signify our respect for women and our self-challenge to reduce domestic violence. Considering the needs of women in Defence is particularly significant. On the Wednesday ambassadors from Australian Defence—including Vice Admiral Ray Griggs AO CSC RAN , Vice Chief of the Defence Force; Vice Admiral Tim Barrett AO, CSC RAN, Chief of Navy; Air Chief Marshal Mark Binskin, AC, Chief of the Defence Force; and Lieutenant General Angus Campbell, DSC, AM, Chief of Army—joined many politicians to witness a flyover of Parliament House. The flyover consisted of two Army Black Hawks, a Navy Bell 429 helicopter, a C17A Globemaster 111 and a C130J Hercules marked with the white ribbon to raise awareness of family violence and encourage commitment to making a change in culture to non-acceptance of such behaviour.

In all spheres, but especially in Defence, there has been an outstanding effort in this regard, so it is equally important that this aspect of workplace flexibility is addressed formally in the first principles review and part of the legislation before the House. While the capacity to provide flexible working arrangements is not new to Defence, this is yet another positive step of change. In addition, the release of the review itself has generally been well received, with a number of commentators expressing the view that implementing the review would improve the operation of the department and the ADF. The Australian Strategic Policy Institute's published analysis of the review was positive, describing it as a 'sensible, serious and purposeful' document.

Item 7 of the bill repeals and replaces parts II and III of the Defence Act. As part of the focus, the review highlighted the need to update legislation to formally acknowledge the key role played by the Chief of the Defence Force and the Vice Chief of Defence in the modern Australian Defence Force. In sections 8 and 9 of the Defence Act, there is a clarification that the minister has general control and administration of our Defence Force and that the command structure of the ADF is confirmed to reflect how it actually works.

It will give full command of the Australian Defence Force to the CDF by removing legislative limitations that were established back in 1903. It will recognise the Vice Chief as the deputy of the Chief of Defence and provide for the service chiefs—Chief of Army, Chief of Navy and Chief of Air Force—to be subject to the direction of the CDF.

Strengthening these key military leadership roles will enable improved coherence and effectiveness in Defence command and decision-making. Currently the Defence Act provides that, subject to the powers of the minister, the Chief of Defence commands the ADF, and the service chief of an arm of the ADF 'shall, under the CDF, command the arm of the ADF of which he or she is Service Chief', which creates a potential ambiguity, a lack of clarity that has been confirmed by legal advice. It is even hard to read. The Chief of Defence's powers may be interpreted as being subject to—and potentially constrained by—the authority of the Service Chiefs to command their respective services. This uncertainty is compounded by other provisions of the act.

Within the new part Ill—'The Australian Defence Force'—proposed section 23 more fully incorporates the Royal Australian Navy and Royal Australian Air Force within the Defence Act's definition of the ADF, including specific reference to their respective chiefs and permanent and reserve elements. The service and training of reserves in the Navy, Army and Air Force are set out in proposed sections 24 to 26. New 3ivision 3 of part III of the Defence Act specifically provides for calling out of ADF Reserves elements.

Proposed sections of the Defence Act provide that the Chief of the Defence Force is to direct and administer the cadets—including the wonderful cadets in my local area—and in doing so the Chief of the Defence Force must comply with any directions of the minister. Importantly, this reaffirms the understanding that neither cadets nor anyone involved in the cadet program is inherently a member of the ADF by virtue of that involvement. Consistent with this distinction, the bill provides that the Chief of the Defence Force may make determinations by legislative instrument for the payment of allowances and benefits to cadets and their families. This is different from the existing arrangement where such payments are made by ministerial determination.

So to clarify: the Chief of the Defence Force will have full command of the ADF with the removal of the legislative limitations on the CDF's command power. The Vice Chief of the Defence Force is to be recognised explicitly as the deputy of the CDF and has both command and administrative responsibilities to the ADF as directed by the CDF. The service chiefs will be explicitly subject to the direction of the Chief of the Defence Force.

Proposed section 27 incorporates into the Defence Act provisions previously in the Defence (Personnel) Regulations 2002, which state that an ADF member's service does not create a civil contract with the Crown or the Commonwealth. Essentially, members of the Defence Force are not employees. Rather, their military service once entered into is an obligation to the Crown. This has been the case for hundreds of years and it means that the status of members of the Defence Force is subject to defence law, not civil law.

As mentioned earlier, the ADF has previously advocated for more flexible working arrangements for its personnel through the Project SUAKIN reforms. This aims to support ADF personnel in maintaining their required continuous service through allowing approved part-time service for full-time personnel. The Defence Legislation Amendment (Superannuation and ADF Cover) Act 2015 provides for flexible service arrangements within the Defence Act 1903, the Air Force Act 1923 and the Naval Defence Act 1910, with effect from 1July 2016. However, with the repeal of the Air Force Act and the Naval Defence Act, this bill makes sure these flexible service arrangements apply across all three service areas.

New division 3 of part III of the Defence Act, 'Calling out the Reserves', is in effect the same as the current division 4 of part III, resulting in no changes to the call-out provisions.

The review was critical of the fact that Defence has a number of geospatial intelligence functions. It noted the administrative inefficiency of this and that a more coordinated and better resourced facility would better improve support to the ADF. To this end, the bill amends the Navigation Act 2012, to position the Australian Hydrographic Service within the Department of Defence, as opposed to the Australian Navy. It is entirely sensible to make these changes in line with the way the defence forces functions in modern Australia. It is effectively a partial catch up with current process yet also it formalises a number of aspects that bring the Australian Defence Force in line with the recommendations of the first principles review.

Currently, the Defence Act does not recognise the ADF as a single entity in its own right; rather it encourages the view that the ADF is no more than a federation of the three services. The bill provides the foundation for a more unified and integrated Australian Defence Force. It streamlines the statutory treatment of the components of the ADF in the defence legislation incorporating the substantive provisions of the Navy and Air Force in the Defence Act. These provisions include the recognition of the Regular Army and Air Force, and the Permanent Navy, together with the reserve components of each of the services, and the ability of the Governor-General to call out the ADF Reserves under certain circumstances.

The bill consolidates the statutory treatment of Defence Force cadets, making provision for the Australian Navy, Army and Air Force cadets in a new part of the Defence Act, while retaining the existing provisions in current legislation regulating the relationship between Defence Force cadets and the ADF.

In substance the bill updates the Defence Act to clarify the control and administration of Defence in line with the first principles review's first principle, which is that Defence should have 'clear authorities and accountabilities that align with resources.' In doing so it seeks to ensure that the Defence Act is brought up to date with the way that Defence is controlled and administered at present. This legislation establishes the structure to achieve stability of defence capability and with bipartisan support positions the Australian Defence Force to plan, in conjunction with the proposals in the defence white paper for sustained planning and ultimately the safety of Australia and our people.

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

I acknowledge the member for Gilmore's excellent speech. In fact, as she was speaking, it made me recall my time living in her electorate as the commanding officer of the Parachute Training School in Nowra from 2000 to 2001. I echo her comments about cadets, because at that time we looked after the 222nd regional cadet unit from Ulladulla and they were a great bunch of young people, many of whom, after having experienced a taste of the Army with my unit, went on to join the Army.

I am also pleased to speak about the Defence Legislation Amendment (First Principles) Bill 2015, which amends the Defence Act 1903. The thinking that underpins the changes in this bill was undertaken during the first principles review of Defence. Members may recall that, prior to the last election, the coalition committed to a first principles review as a way of ensuring that Defence is appropriately structured and organised to support the Defence Force into the 21st century.

There were five people named to head up this review: the former managing director of Rio Tinto, David Peever, who was assisted by Jim McDowell, a former BAE Systems executive, Robert Hill, a defence minister in the Howard government, Lindsay Tanner, a finance minister in the Rudd government, and former Army chief Peter Leahy. Their report was titled Creating one Defence. It was released in April this year and is set to reshape the Defence enterprise over the next few years. The review praised Defence's record of operational service, which has certainly grown in the last 15 years.

The review makes me reflect on the fact that, when I first joined the Army, as a young 17-year-old soldier in 1978, there was a fairly narrow focus at that time on the defence of Australia. I can recall doing a lot of exercises focused on that sovereign protection role. In addition to working out how to repel the mythical Musorian enemy—they were called the 'Musorian Armed Forces'—we fought a fair few bushfires in support of civil authorities around Australia. We undertook a variety of humanitarian assistance and disaster relief tasking, and trained for the possibility of assisting the protected evacuation of Australians and other approved nationals in our region. I can even recall in 1983, as a nuclear, biological and chemical Defence instructor, being part of a response team ready to respond to Kosmos 1402—a nuclear powered, disabled Soviet satellite—which at that time had the potential to scatter radioactive fragments across Australia. But I must admit that those moments of excitement and high tempo were pretty few and far between.

How things have changed as concepts of security have broadened during the last 35 years, as have the things that we routinely expect of our troops. The Australian Defence Force still helps our civil authorities to fight bushfires and deploy to places like Pakistan and Banda Aceh, Japan and Papua New Guinea in support of our humanitarian assistance and disaster relief objectives. Our troops have also assisted the people of East Timor during troubled times. They have furthered the cause of good governance in the Solomon Islands, conducted border protection activities close to home and counter-piracy operations in the north Arabian gulf and off the Horn of Africa. Perhaps most notably, they have fought and died while conducting high-intensity war fighting in places like Afghanistan and Iraq.

In responding to those broadened concepts of security and our community's increasing expectations of our troops, the first principles review found that Defence has implemented significant changes since the 1990s. Despite that outstanding record of operational service, the first principles review also called for more effort and improvement in the area of organisational effectiveness. One of the report's key recommendations said, quite rightly, that we had to 'establish a strong, strategic centre' to strengthen governance, accountability and top-level decision-making. The report highlights the need for more work to be done in aligning the government's strategic aspirations with the tasks we ask our troops to perform on behalf of the Australian people, and we need to make sure that we give the Defence Force the appropriate resources to undertake those tasks.

It is fair to say that the first principles review is only one component of this important work. As Australians will know, the Defence white paper and the force structure review will also contribute to that restoration. But the first principles review highlighted some key shortcomings that must be urgently addressed—in particular, the need for some re-engineering of Defence structures, processes and systems. Governance and accountabilities need to be more clearly defined; institutional waste and suboptimal decision making must be addressed. Getting the most out of the white paper relies on these enhancements to structure, system and process. To achieve this, Defence must move from a current inefficient federated approach into a single, integrated organisation that delivers an enhanced joint capacity.

As I said earlier the title of the report, Creating one Defence, sums up the proposal behind it. The key purpose of this bill, therefore, is to enshrine the properly constituted command arrangements at the very top of Defence which will support unity of purpose. The government has agreed, or agreed in principle, to 75 of the 76 recommendations. The review outlines a two-year implementation plan with key milestones which provides high-level direction for Defence. The implementation of these recommendations will be led by the secretary of the department and by the Chief of the Defence Force, and will commence immediately, with the majority of the recommendations made in the report to be implemented within two years. The commitment of this government and that of the Defence senior leadership is steadfast in delivering on these recommendations.

Leadership is of course central to an effective modern defence force, as is unity of purpose between the three services. The first principles review has charted a course towards an integrated organisation that delivers enhanced joint capability. Perhaps the key recommendation of the review was that Defence:

Establish a strong, strategic centre to strengthen accountability and top level decision-making

This requires the updating of legislation to formally codify the roles played by the Chief of the Defence Force and the Vice Chief of the Defence Force in particular. A key effect of this bill is the amendment of the Defence Act so that the authority of the CDF and VCDF is formally recognised. The review recommends in its report:

During most of Sir Angus Houston's time as Chief of the Defence Force, I served as a member of his Strategic Command Group in Russell offices building R1. That experience re-confirmed for me that, when it comes to command and control, we must rely on properly constituted and legislated arrangements, rather than on goodwill, between the CDF and the service chiefs. This bill strengthens key military leadership roles, enabling improved coherence and effectiveness in Defence command and decision-making.

In addition to strengthening the command responsibilities of the Chief and the Vice Chief of the Defence Force, the bill streamlines the statutory treatment of the components of the Australian Defence Force in defence legislation, repealing the Naval Defence Act 1910 and the Air Force Act 1923 and incorporating the substantive provisions of these acts in the Defence Act 1903. These provisions include the recognition of the Regular Army, the Permanent Air Force and the Permanent Navy, together with the reserve components of each of the services, and the ability of the Governor-General to call out Australian Defence Force Reserves under certain circumstances. These include wartime, peacekeeping operations, support to community activities of national or international significance, and humanitarian assistance and disaster relief.

Let me touch briefly on the legislative coverage of the Defence Reserves, which are being brought together into a single Defence act, helping to further integrate our reserves into the total force concepts articulated in Plan Suakin and Plan Beersheba. When I spoke earlier about broadened concepts of security, it has often been the reserves that have filled the breach, so to speak, in assuming the responsibilities of our regular forces to free them up for high-intensity activities at the upper end of the conflict spectrum that I mentioned earlier. The reserves have filled rotations for our Rifle Company Butterworth deployment in Malaysia. Outstanding reservists, including from my home state of Tasmania, have also deployed to places like Solomon Islands and Timor.

In essence, this bill traverses the broadened concepts of security I highlighted earlier, ensuring that the ever-increasing range of tasks we expect our troops to do, from humanitarian assistance at one end of the spectrum to high-intensity war fighting at the other, are appropriately recognised, commanded and resourced.

Importantly, the measures in this bill ensure that, for the first time, all three services of the ADF are under one act—the Defence Act. The services retain their individual identity and service chiefs but are nested under the Defence Act as part of the Australian Defence Force. It is not exaggerating the point to say that this is historic because, prior to this, each service was separately recognised in legislation.

The powers of the service chiefs as a result of this change are subordinate to the overall direction of the Chief of the Defence Force. That said, the service chiefs' vital roles in raising, training and sustaining capable force elements within their services remains, and they will continue to command their respective services subject to the sole command direction of the Chief of the Defence Force. For the vast majority of our troops, their local command-and-control arrangements will remain unchanged. Of equal importance is the fact that none of the identities, traditions or history of our service units will be lost.

As I mentioned earlier, I note the bill also consolidates the statutory treatment of Defence Force Cadets, making provision for the Australian Navy, Army and Air Force cadets in a new part of the Defence Act. That is why I am pleased that this bill modernises the existing provisions to ensure the relationship between Defence Force Cadets and the Defence community is interlinked. But the bill also makes it clear that Defence cadets are volunteers—a community-based youth development organisation. The day-to-day activities of cadet units and their organisational structure into Navy, Army and Air Force cadet units remain unchanged. Again I reflect on the excellent generosity of spirit of the people who are involved with our cadets, giving them a taste of and an interest in service life in the Army, Navy and Air Force and, as I said, translating that interest into their joining our services and going on to serve our country.

I note that this bill enjoys bipartisan support in the parliament and I thank members opposite for lending their support to the sensible, uncontentious provisions that this legislation encompasses. I join my parliamentary colleagues in welcoming this bill that implements two key recommendations of the first principles review. It results in a stronger, whole-of-organisation command framework in Defence, and I have no hesitation in commending this bill to the House.

Bob Baldwin (Paterson, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Defence Legislation Amendment (First Principles) Bill 2015. The government commissioned the first principles review of Defence in 2014, the focus of which was to ensure that Defence is fit for purpose and is able to respond to future challenges and deliver against its output with the minimum resources necessary.

The government released the First principles review on 1 April 2015 and agreed to or agreed to in principle 75 of the 76 recommendations. The review found there were a proliferation of structures, processes and systems with unclear accountabilities, which, in some cases, caused institutionalised waste, delayed decisions, flawed execution, duplication, overescalation of issues for decision making and low engagement levels amongst employees in parts of the organisation. This is critical to the future of our Defence Force, the protectors of our nation.

One of the key recommendations of the review was to establish a strong strategic centre to strengthen accountability in top level decision making in Defence—I want to come back to that a bit later. The Chief of the Defence Force and the Vice Chief of the Defence Force will have ultimate power over the Defence Force. This bill formally recognises their authority. It gives full command of the Defence Force to the Chief of the Defence Force by removing any legislative limitations contained in the Defence Act 1903. It recognises the Vice Chief of the Defence Force as the deputy of the CDF and provides for service chiefs of the Army, Navy and Air Force to be subject to the direction of the CDF. This is all about strengthening the Defence structure in this nation to deliver greater capability.

There are also other subsequent matters to be repealed, but I want to particularly focus on a couple of issues in my local area. Since 1996, when I entered this parliament, whenever I have not been a member of the executive of the government, I have been a member of the Joint Standing Committee on Foreign Affairs, Defence and Trade. In particular, I take an active interest in the defence subcommittee. I am a strong advocate and a very strong supporter of Defence and defence industries in my electorate and, in fact, in the whole Hunter. In the neighbouring electorate, there is the home of Singleton Army base. In the neighbouring electorate of Newcastle, there is the Williamtown RAAF base, which was once in the electorate of Paterson. At the Williamtown RAAF base, we have the FA18 and the Hawk lead-in fighter, which was actually assembled at Williamtown. It is also the home of the advanced early warning aircraft, and it is soon to be home of the F35 Joint Strike Fighter. Currently, there is a base redevelopment to the value of around $1 billion to accommodate the Joint Strike Fighter, and that flows on to our local economy through increased jobs.

Defence industry is a critical employer in my area, and it is reflected in the economic contribution to our Hunter region. But there is an underlying need to reduce tendering costs, to speed up approvals and to avoid scope creep, in particular, for small to medium enterprises. That is why, when I spoke about the requirement for accountability to the CDF, we now have a one-stop shop for all of the problems. There can be no more passing the buck. Last week, I raised these issues on Defence contracting in the defence subcommittee of the parliament with Mr Kim Gillis, the new deputy secretary of the Capability Acquisition and Sustainment Group, CASG, which has replaced the old DMO.

I welcomed the news last week that Forgacs's engineering, shipbuilding and defence divisions are to be acquired by Civmec. This will spread Civmec's footprint and give greater certainty and more opportunities to the future of shipbuilding and Defence contracting across our region. I well remember working with the late founder of Forgacs, Steven Forgacs, and his acquisition of the Tomago shipyard from the Australian Submarine Corporation in 1996 to ensure a shipbuilding future for the region. I worked with him and the then former head of DMO, Stephen Gumley, to ensure that air warfare destroyer modules would come to our region. That is but one of many companies in the Hunter. Varley Engineering at Tomago is another outstanding local, private company that is headed by Jeff Phillips and engaged in Defence projects—in particular, the delivery of the Joint Strike Fighter ground support equipment components and the development and design of unique specialty engineering solutions for military vehicles and integrated military shelters. Their work on LAND 121 with Mercedes and Rheinmetall is delivering jobs to our region.

Bohemia Interactive Simulations at Nelson Bay is headed by Ryan Stephenson. This is a global software company leading the world on military simulation training solutions for tactical military training. These unique and highly accredited war game strategy programs have been adopted by militaries across the world. Bob Cowan's Cowan Manufacturing in the southern part of the region at Warners Bay has developed an international reputation with navies across the world for his high-tech specialised recompression chambers, which not only have won Australian design awards but also are accredited by the Australian and US navies. C-E Solutions, headed by Boris Novak, is also located at Nelson Bay. It is a systems engineering surveilling and control specialist team that has delivered defence solutions, not only for Australia but across the world, with mobile surveillance platforms and weapon impact scoring systems. Partech Systems at RAAF Williamtown is a leader in the development of test program sets for military avionics equipment, working on platforms such as the FA18 Hornets, Seahawks and the Joint Strike Fighter program. At Cardiff, there is Puzzle Precision, a specialist, Defence-accredited, high-tech electronics assembly firm working on unique and specialised circuit boards. Around the corner from my home at Thornton, the team at ATSA Defence Services develop, test and maintain remote operated vehicles, an underwater system critical in mine warfare. Then of course there are BAE, Lockheed Martin and Boeing facilities at Williamtown RAAF base. This is to name but a few innovative Defence contractors and support specialists that have expanded and utilised the specialist skills in the region to establish the Hunter as one of the leaders in their field, not just nationally but internationally. I also commend Ian Dick and the team at Hunter Defence in promoting the skills and the opportunities our region can provide to a growing Defence presence in the Hunter. As I said earlier, there is an expansion of Williamtown RAAF base to accommodate the Joint Strike Fighter program—an investment of over $1 billion.

As the CDF now has absolute power over the Defence Force, and absolute responsibility, the next issue I want to raise lies with him as the person at the top. I know he is showing a great interest in it.

The biggest issue I have to deal with is the PFOS contamination, the firefighting foam contamination, which is leaking from Williamtown RAAF base. I have raised this issue here in the parliament before, and I acknowledge the presence in the chamber of Assistant Minister for Defence, Darren Chester. Last Friday, I met with Professor Ravi Naidu, Chair of Global Innovation and Director of the Global Centre for Environmental Remediation based at Newcastle University. He is a world leader in dealing with cleaning up contaminated messes like that of PFOS at Williamtown. Professor Naidu is also CEO and Managing Director of the Cooperative Research Centre on environmental remediation. Professor Naidu is already undertaking remediation works at other defence facilities, so I ask the question—and it is pertinent that the assistant minister is here: why hasn't he been contracted to start work at Williamtown? This is one of a number of possible solutions to the problem to be explored. After my meeting on Friday, I referred Professor Naidu to Air Vice Marshal Greg Evans—Defence's lead person for this issue in the region. I will also be raising it at a meeting that I am hoping to procure later today or tomorrow with my colleague Darren Chester, to follow-up on our discussions last week. I will not let this issue go. We require action—urgent action.

It is important, first of all, to make sure that we have safe, potable water for my constituents to drink and to give to their animals. I know that Defence are filling tanks and providing water bottles to people. But I have also put forward the suggestion to the assistant defence minister that perhaps we need to engage Hunter Water, who have been vocal about this issue, to provide town water mains through that region. The main pipeline goes right past these affected properties. There are some in the community who are saying, 'We don't want town water,' but a lot of my constituents are raising with me that they do want it, because they want safe, potable water. The other thing that needs to occur is the stopping of the contamination—and it needs to be stopped very quickly. There are many ways to do this, and some of them are discounted by experts in Defence but they need to think outside the square. There needs to be a levee built around Lake Cochrane. The water in it needs to be drained and cleaned and the contaminated soils contained in Lake Cochrane excavated and stockpiled. There is an opportunity to deal with this waste with the Hunter being home to some of the largest open cut mines in Australia. Some of these pits are hundreds of metres deep. There is no reason that contaminated soil and water could not be buried deep in that area rather than them going through an expensive treatment process. The soil would be buried under millions of tonnes of dirt. It would never reach the surface and there are no aquifers through these coalmines. We need to clean up not just Lake Cochrane but also the Dawsons and Moors drains. That can be done in part by excavating the soil around the sites and removing it from the sites. This will not eliminate but it will reduce the immediate flow-on effect of the PFOS continuing down the drain.

We need to provide support—total support—to my community. We need to look after their health. There has been a call for blood testing. As I have said publicly, there is no reason that New South Wales department of health cannot organise blood collection where people require it—whether that is the Tomago hospital, the Maitland Hospital or the John Hunter Hospital—and then have these blood tests analysed by the National Measurement Institute. This will give people peace of mind. The community is calling for it. They are not responsible for this contamination but they have been the recipients of it.

There is also the issue of the prawn and fishing trawlers who have had a ban placed on them since 3 September. That ban goes through to June 2016. I acknowledge that the government has provided income relief through a fortnightly payment of $523. The government has also provided a $5,000 one-off grant to affected businesses, as well as $20,000 over five instalments to help meet the ongoing costs of maintaining the survival of these businesses. These people have lost a lot more than that. I think the government needs to rethink the package and provide greater support. There are not only the prawn trawlers. There are also the egg producers and the beef producers whose products are restricted from going to market. There is also the stigma or the perception surrounding any product that comes from that region. We need to do what we can and as quickly as we possibly can to restore the lifestyles and the security of property to those affected constituents in my electorate.

The most pressing issue—and I have taken a number of calls on this recently—is the mental anguish that people are going through. For those whose bore or water supply tests positive with PFOS—and I do note that, of the 45 tests that have been conducted by Defence, only seven have proved positive—their mental anguish is supreme. Not knowing what you do not know is a major part of the problem. The New South Wales department of health put out one set of fact sheets in relation to this issue and then the Chief Scientist, Mary O'Kane, put out contradicting evidence. There needs to be a single, clear line of communication, an explanation of the facts and a plan and a program put forward about what can be done, what will be done and in what time frame it will be done.

This bill gives ultimate power to the Chief of the Defence Force. As he was once based at Williamtown, he knows the issues there very, very well. I ask for his personal intervention, along with that of the assistant minister, to make sure that we provide a solution to this problem in quick time, not long time. I commend this bill to the House.

Darren Chester (Gippsland, National Party, Assistant Minister for Defence) Share this | Link to this | Hansard source

I welcome the opportunity to speak in relation to the Defence Legislation Amendment (First Principles) Bill 2015. Of course, following the honourable member for Paterson, it would be timely for me to reassure him and other members affected by the Williamtown contamination that the government and the Australian Defence Force are taking their responsibilities very seriously.

The concern raised by the honourable member and other members in this place have been the subject of a great deal of investigation by the government. It is a legacy issue that this government is dealing with here, dating back many decades. It is one that will take a considerable amount of effort not just in the Defence space but also in the civilian space as we start looking at the use of aqueous film-forming foam as it has been used throughout Australian history. I can assure the member that it is something the minister, Marise Payne, and I are taking very seriously, and we are working with him and his constituents to achieve the best possible outcome.

Specifically in relation to the legislation before the House, it is important to note that the legislation follows the recommendations from the First principles review—creating one Defence, which was commissioned by this government in 2014 and released in April 2015. The review found there was a proliferation of structures, processes and systems, with unclear accountabilities which, in turn, caused institutionalised waste, delayed decisions, flawed execution, duplication, overescalation of issues for decision and low engagement levels amongst employees in parts of the organisation. The review proposed substantial change across Defence to ensure it can deliver on the future requirements which will be outlined in the government's upcoming Defence white paper.

As part of the first principles review and the legislation before the House today, the passage of this bill will ensure that, for the first time, all three services of the ADF will be incorporated under one act, the Defence Act. That is historic because until now each service was recognised separately in legislation in recognition of their different histories. So, in speaking to the legislation before the House, I want to draw attention to one aspect of the first principles review: the support required to meet Defence's future capability needs through the Defence estate.

The Defence estate—as you would be aware, Mr Deputy Speaker Mitchell, in your own electorate—is a complex beast and it has been the subject of significant discussion and debate in recent times. The former government commissioned the Future Defence Estate report in 2012. This government is committed to ensuring we provide for significant savings for Australian taxpayers through a smaller and less dispersed Defence estate while still, obviously, meeting the capability needs of a modern Australian Defence Force. The key factor in terms of what has changed in recent times regarding the Defence estate, from a government perspective, was a decision to ensure that any proceeds from consolidation of the Defence estate would be reinvested in defence itself. So this should not be seen through the prism of a budget saving or a finance measure. It is all about making sure our Defence estate is efficient and needs the future needs of the ADF. One of the other things I want to do in the context of my contribution today is reassure affected communities that, when we are talking about the consolidation of the estate, this should not be seen as a threat. In many cases it is a repurposing of an existing asset in a way that will allow it to make a far more significant contribution to a local community into the future.

My objectives in negotiations with local councils, state government and local communities when we are talking about the consolidation of the estate provide three broad parameters. My first objective is, quite naturally, to obtain a good return for Australian taxpayers and give them a fair return from a parcel of land that they obviously own. The second objective is to make sure that in doing the negotiations we maintain and enhance, wherever possible, the reputation of the Australian Defence Force, keeping in context that the ADF has been in many of these places for decades and has had a very good working relationship with the host community. We want to enhance that reputation into the future. Finally, I want to make sure we work in partnership with the local members of parliament. Whether they be from the coalition side, from the Labor benches or from the Independents, I want to make sure we work in partnership with them as much as possible—and with their local councils and their state MPs—to deliver the best possible result for their local community.

I would like to take the opportunity, in the context of the legislation before the House, to reflect on some current progress in relation to the Defence estate consolidation. The government has taken the view, in support of the first principles review team, to assess the consolidation effort on a case-by-case basis rather than trying to put forward whole blocks of property for disposal. We have worked in a coordinated and cohesive way to put forward individual parcels of Defence estate for consolidation. I will take this opportunity to update the House on a couple of the more significant parcels throughout Australia.

One is the Bulimba Barracks site on the Brisbane River, which I have worked on with the member for Griffith in recent times. On 20 March this year the government announced that Defence will dispose of the majority of the Bulimba Barracks in Queensland. However, a portion of this land will be retained for use by the naval cadets who are on site. It is in the order of a 20-hectare site, and Defence has been working very closely with state and local government throughout the year, including through the preparation of a master plan for the Bulimba site. We continue to have very productive negotiations with the state government and local council in that regard, and we are confident and hopeful that within months we will be able to progress a sale for this site for the benefit of the local community.

Across the other side of Australia, another very substantial site—again, in a waterfront location—is the Leeuwin Barracks at Fremantle. I have worked with the member for Fremantle and had several discussions with her in this place about the future of Leeuwin Barracks. Defence has indicated that Leeuwin Barracks is surplus to Defence requirements in the future and will be sold. We have not progressed as far with this negotiation or discussion with the local community as we have with Bulimba, but Defence is now working to ensure that ADF personnel and public servants associated with Leeuwin Barracks are aware that it will be sold. The nearby Irwin Barracks will be the subject of significant redevelopment to accommodate the staff required into the future. Leeuwin Barracks is on a 14-hectare site. It is on the southern banks of the Swan River in East Fremantle, about 16 kilometres from the Perth CBD, so obviously it is a very sought after site. We are working to make sure not only that the state government is involved but also that the local council, the East Fremantle local government area, is aware of our ambitions to sell the site. We are seeking opportunities to make sure that the precinct is developed well and sensibly and in such a way that the local community gets maximum enjoyment and benefit from it in the future, keeping in mind that we will be making every effort to retain the significant Defence heritage on that site, most notably a memorial to the young naval cadets who were the subject of some serious abuse in the past. So the need is there not only to be sensitive to the previous use of the site but also to look at ways we can work with the community to ensure that the Leeuwin Barracks site is well managed and well used into the future.

A smaller site is the Pontville Small Arms Range Complex in Tasmania, which is an approximately 517-hectare site. A lot of it is open grassland. It will be sold in two stages. It is a 2.8-hectare area on the western side of the Midland Highway which is currently on the market. Expressions of interest for stage 1 closed earlier this month and bids are now being considered for that that particular site. I would like to acknowledge that the member for Lyons has worked very closely with his local community, the state government, the local council, community groups and various interest groups and has advocated very strongly on behalf of his community to try to find a suitable buyer that will maximise the use of this site in the future.

The Pontville site is listed on the Commonwealth Heritage List as one of the sites used for training of the 1st AIF in August 1914. The heritage listing also includes natural heritage values on the site with remnant grassland and grassy woodland communities. I think the negotiations on that site will take some time. As I said, there have been several organisations that have expressed an interest and we will be proceeding to an open sale of that site within months as well.

Another site which is of significant interest is the Inverbrackie site. Defence determined, and the government agreed, that Inverbrackie in the Adelaide Hills is no longer required to meet the future capability requirements of the ADF. Defence is currently undertaking due diligence before this site, which is about 22 hectares, is sold. This site is about 37 kilometres from the Adelaide CBD. I have had some discussion with the local member, the member for Mayo, about this. Again, he is keen to work with his community to achieve the best possible outcome as we repurpose a site which has served the community well in the past and will continue to serve the community well into the future.

Another Brisbane site which I omitted to mention previously is the Witton Barracks location in Brisbane where the member for Ryan and the Brisbane City Council have been keen to reach a resolution which is mutually beneficial for Defence and the local community. There is an off-market bid for that site which is being progressed through the usual channels within the government at the moment. I would like to commend the member for Ryan in particular for her diligence in pursuing an outcome on this particular site. It is one that I think will meet the needs of the Brisbane community and meet the infrastructure requirements for the local community in the future whilst also preserving the heritage of that important site from the ADF's perspective.

On a smaller scale, in the last 12 months through my office the consolidation has included one site in my own electorate—that being the old Darriman naval transmission station site or Omega Tower, as it is known locally. It was actually the scene of a tragic death in January 2014. A decision was made at that time that the tower was surplus to Defence's needs. There was no ongoing requirement for the tower. It was the subject of a demolition earlier this year and that site has been sold. I think it will primarily be used for local grazing in the future.

Another site which I would like to congratulate the member for Page on and which we worked very closely on is the Casino Drill Hall. It has been returned for community purposes after a successful negotiation between the local council and Defence on an off-market sale, with the support of the Minister for Finance.

So the activity in relation to Defence's estate disposals is continuing. It is on a case-by-case basis. There will be other examples of property which are identified as being surplus to Defence's needs that will go through that process of negotiation—first of all, seeking opportunities for off-market sales with local governments or state governments, as is appropriate, and, if they are not required for those purposes, we will proceed to private sales.

I would like to thank the Defence department officials who have worked very closely with me on these issues. Lorraine Holcroft and her team and Steve Grzeskowiak have been very diligent in pursuing these individual property disposals. It has been a good example of how when we work in partnership with local communities and local members and put all the politics aside we can achieve good outcomes for the Australian people.

One other point I would like to make in relation to the legislation before the House is that it makes provision for the Australian Navy, Army and Air Force cadets in a new part of the Defence Act whilst still retaining the existing provisions with regard to the relationship between the ADF and Defence Force cadets. Defence Force cadets and their instructors are not members of the ADF, although they do enjoy the support of ADF members. The Australian Defence Force cadets number in the order of 25,000. Army obviously have the greatest proportion with about 15,000 or 16,000 cadets. It is the key youth development priority for the Australian government, as indicated by our expenditure in that regard. The Australian government—both this government and the previous government—strongly support the youth development initiative driven by the Australian Army, Navy and Air Force cadets. I am very keen to see the program expand in the future.

Early this year I had the opportunity to travel to Weipa to open a new Air Force cadets unit. It was great to see the young Aboriginal kids in particular having their first opportunity to access all the benefits that the cadet program offers to them. It was terrific to see young people from, in many cases, low socioeconomic backgrounds getting the chance to put on the uniform, go on parade, learn about teamwork, learn about leadership and learn new skills that I am sure will help them in their future careers.

I stand here as a very strong supporter of the Australian Navy, Army and Air Force cadets, and I encourage local members from across Australia to take the opportunity the Christmas break presents to them to visit their local cadet units and get involved and have the chance to see exactly what they do in their communities. We obviously see them most prominently every Anzac Day, but throughout the year the cadets are very active in their communities. I encourage local members to support them whenever they can.

We all recognise that investing in our young people and helping them achieve their full potential is critical to the future of our great nation. I pay tribute to the cadets themselves, to their instructors and to their families and friends who support the cadet units for the work they are doing in support of young people throughout Australia. With those comments, I thank the House for the opportunity to speak and I commend the bill to the House.

Teresa Gambaro (Brisbane, Liberal Party) Share this | Link to this | Hansard source

I also rise to speak to the Defence Legislation Amendment (First Principles) Bill 2015. I thank the previous speaker for his contribution. I want to acknowledge the fine work that he is doing as Assistant Minister for Defence and the diligence with which he carries out his role. My interactions with him regarding the military base in my electorate have been very, very favourable.

This particular legislation strives for a better balance between the effective use of resources and effective operational capabilities. They are simply common-sense changes to ensure that we have one of the best militaries in the world and that it remains that way. The amendments come out of the government-commissioned First principles review—creating one Defencein 2014. The review followed a broad consultation process, taking the best facets of community and business best practice and incorporating them into the management of our Defence Force. The focus of the review was on making sure that Defence is fit for purpose, able to respond to future challenges and deliver against outputs with the minimum resources necessary. As the review found, the operation of the Defence Force in the past proved to be very costly and cumbersome and some new processes needed to be put in place to take us forward.

The government released the First principles review—creating one Defenceon 1 April 2015. I want to commend the fine work that was done. The review team, which was expertly chaired by David Peever, comprised Professor Robert Hill, Professor Peter Leahy, Mr Jim McDowell and the former finance minister in the previous Labor government, the Hon. Lindsay Tanner. The government agreed, or agreed in principle, to 75 of the 76 recommendations made in the report. As previously mentioned, we are absolutely committed to having a world-class military to defend our country both at home and abroad.

The review found that there were a proliferation of structures, processes and systems that had layer upon layer of unclear level of accountability. This caused a lot of institutional waste and delayed decisions. There were flawed execution, duplication and overescalation of issues, and low engagement levels amongst employees in many parts of the organisation. The review proposed substantial change across Defence to ensure that it can deliver on future requirements that will be outlined in the government's forthcoming Defence white paper. A key recommendation of the review was to 'establish a strong, strategic centre to strengthen accountability and top level decision making' in the Defence Force.

As part of the focus on the joint force, the review highlighted the need to update legislation to formally acknowledge the key roles played by the Chief of the Defence Force and the Vice Chief of the Defence Force—the VCDF—in the modern Australian Defence Force. The key purpose of the bill is to formalise the authority of the CDF and the VCDF. It will give full command of the Australian Defence Force to the CDF by removing legislative limitations in the Defence Act 1903, recognising the VCDF as the deputy of the CDF and providing for the service chiefs—Chief of Army, Chief of Navy and Chief of Air Force—to be subject to the direction of the CDF. It also looks at strengthening and streamlining the key military leadership roles of the CDF and the VCDF, which will enable improved cohesiveness and much more effectiveness in the Defence command and decision-making aspects of Defence. As the chamber would know, the key to an effectively run organisation as big as our Defence Force is strong communication channels. This is absolutely integral to the bill.

Another recommendation found that, as part of the performance management system, Defence should take steps to create a culture where leadership, professionalism and corporate behaviour are valued and rewarded. This is absolutely vital in our Defence forces. It is absolutely vital that these values remain at the apex of our military, that the best and brightest are elevated to senior positions. I want to thank members of the Defence Force for their contribution to the complex project management course that was started at QUT in the electorate of Brisbane. This course was much anticipated and very well received. It will also ensure that we have some of those brightest graduates going back into Defence and working with that industry group in a very positive way in the future. I want to thank the founders of that particular course, who are a mixture of academic and military people, and place on the record my congratulations to Professor Little at QUT and to Kim Gillis.

Another issue this bill seeks to rectify is the uncertainty in the chain of command, which presents a potential problem of ambiguity and lack of clarity—this has been confirmed by legal advice. The CDF's powers may be interpreted as being subject to the authority of the service chiefs to command their respective services. This uncertainty is compounded by other provisions of the act.

The review also recommended the management of staff resources to deliver the optimal use of funds and maximise efficiency, including abolishing the use of antiquated measures such as the teeth-to-tail ratio and the one-third budget split. This will be a very welcome recommendation.

The bill also facilitates the implementation of an enterprise approach to the delivery of corporate- and military-enabling services to maximise their effectiveness and efficiency. This will be manifested through Defence disposing of all unnecessary estate holdings. The assistant minister spoke earlier about what an enormous task that is. Defence has some of the largest Defence holdings in the country, many of which are surplus to use. It is a very involved process. It is important, when many of those Defence estates come onto the market to be disposed of, that the relevant environmental planning and community consultations take place and that former Defence estates are disposed of in the most efficient way possible in order to return that revenue back to the government. I want to again acknowledge that this is a huge part of the Defence budget. It certainly has changed over the years. This particular review focussed on that and said that there are better ways that we can move along to make this process much more efficient and a lot speedier than occurred in the past. Whatever occurs, it is the best possible outcomes for Defence that are at stake here.

Another recommendation was to examine the System Program Office to determine the most appropriate procurement model and achieve value for money. Again, Defence has many SMEs that contract to it in the procurement and supply chains. It was very interesting to the see the first principles review focusing on many of these procurement practices and recommending the way forward. I am sure many of Defence's SME suppliers will welcome such a recommendation. They are a very valuable and important part of our whole defence industry. I pay tribute to many of these SMEs that work in this area. They are some of the most innovative and dynamic companies in Australia, and we thank them so much for all that they do and for their input into the defence industry aspect of defence.

Clearly, the amendments are embracing best practice management, which is indicative of the government's legislation presented in the House. As the government, the Public Service and indeed the economy continue to adapt and innovate, it is absolutely imperative that Defence comes along with them, as part of this adaptation. Defence has some of the brightest and most innovative people, but in a lot cases it is being let down by the processes. So I acknowledge again the wonderful work that was done by the first principles review. I know that they will continue taking an active role in this area, and that they will be working with the secretary of the department and with Defence in an overview role to ensure that many of these processes will be implemented over the next two years. That has been welcomed by all in Defence. I congratulate the Peever committee. These are fine recommendations. The bill will ensure that the chequered past of the Defence Force's management will now longer be an issue in the future. I commend the bill to the House.

Matt Williams (Hindmarsh, Liberal Party) Share this | Link to this | Hansard source

Defence, as we know, is one of the most important priorities of the federal government. It is expensive, but it is worth investing in. This government is committed to increasing the level of defence spending by up to two per cent of GDP, and it is important that that money that is spent wisely. That is why this legislation is important. As we have heard from my colleagues, this bill will strengthen accountability and improve our decision making, ensuring that those on the front line get what they need to serve and protect our nation.

Other than attending many community events, it would be fair to say that, as the member for Hindmarsh, I have spent most of my time on Defence related matters—more than on any other issue. I know the member for Makin, who is sitting in the chamber today, is well aware of the considerable attention and engagement that I have had with the defence industry across Australia but also in our state of South Australia, regularly talking with the key defence companies and key industry bodies to make sure that we get the best outcome for our nation from the investment that we make in defence. That includes the numerous meetings with defence ministers and prime ministers that I have had, pushing for sustainable shipbuilding based at the facilities at Osborne in South Australia. The announcement earlier this year that the frigates and the offshore patrol vessels would be brought forward, fast-tracking those projects, is great news to all involved in the defence industry in Australia. I know that the member for Makin is very supportive of the announcement and of the jobs that it will bring our state, South Australia—around 2,500 on the Future Frigate program. I look forward to the member for Makin's positive contribution to this debate and acknowledgement of that important announcement and the fast-tracking of those projects, as time goes on. I also look forward to the contributions of many other members of parliament from both sides, and also from the industry, including bodies like the Defence Teaming Centre, on how important the Future Frigate program is to our state, as well as other Defence projects. Obviously the Future Submarines program is another massive project. I have spent countless hours meeting with the submarine builders and meeting with the various stakeholders on the importance of that project to our country and the maximisation of Australian industry involvement, importantly.

The air warfare destroyers and the future frigates will be significant projects. We all know that they are on the right track with what they are doing with the air warfare destroyers. I was down there a few weeks ago, and the improvements that they have made in the productivity and performance of their work are commendable. I want to congratulate all the workers at ASC and those involved in the project for the improvements that they have made, especially in boat 2 and boat 3. It is often the case that the first one is the most challenging, but, as time goes on, things have become better in terms of the construction of those important warships. This demonstrates how, if we have the right people involved and the right focus, we can improve in terms of the work that we do.

It is a wonderful facility at Techport. The former United States Secretary of State and current US presidential candidate, Hillary Clinton, said only three years ago on her visit to Techport in Adelaide that:

Adelaide is, from our perspective, one of the great critical industrial centres in the world and part of Australia's defence manufacturing and a city where American and Australian companies work together in close partnership every day.

I know through the Air Warfare Destroyer program that Raytheon is one of the alliance partners. Lockheed Martin, BAE Systems and other companies—whether they be from the US or the United Kingdom like BAE Systems and Babcock—do significant work down there. Highly skilled engineers, software systems programmers and other specialists in the defence sector do some great work down there. I was recently at Pacific Marine Batteries, who make the batteries for the submarines. They are world-class in what they do, and they are doing some interesting work in research and development that could be quite valuable in years to come.

Returning to the Defence Legislation Amendment (First Principles) Bill 2015, the focus of the review was on ensuring that Defence is fit for purpose, is able to respond to future challenges and deliver against its outputs with the minimum resources necessary. The government released the review in April this year and agreed or agreed in principle to 75 of the 76 recommendations in the report. The review found there was a proliferation of structures, processes and systems with unclear accountabilities, which in turn caused: institutionalised waste, delayed decisions, flawed execution, duplication, over-escalation of issues for decision and low engagement levels amongst employees in parts of the organisation. We, as a prudent and responsible government, review government agencies, departments and our operations and try and improve things and get better efficiency and better accountability. The review proposes substantial changes across Defence to ensure it can deliver on the future requirements that will be outlined in the government's forthcoming Defence white paper. A key recommendation of the review was to establish a strong strategic centre to strengthen accountability and top-level decision making in Defence.

I will not go through some of the more administrative elements of the review, because we have heard about those from my colleagues, but, in summary, this is important work of the government. It is important that we continue to look at all ways to improve the productivity of all departments, and I welcome the appointment of a board that will ensure that these improvements are implemented. The board is made up of the authors of the first principles review—David Peever, Robert Hill, Lindsay Tanner, Peter Leahy and Jim McDowell—with the addition of Erica Smyth. I know Robert Hill personally. Being a fellow South Australian and a former defence minister, he brings a lot of expertise not only from the Defence portfolio but from other experience in politics in general. Jim McDowell, from BAE Systems, is a fine man with fine credibility for the role. I support the work that they do and wish them all the best. I commend this bill to the House.

Dan Tehan (Wannon, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Defence Legislation Amendment (First Principles) Bill 2015. I start by making the point that this is an incredibly important piece of proposed legislation. As we now hear far too often—but it needs to be continually repeated—the No. 1 priority of government is to keep its citizens and this nation safe. That is very much at the forefront for the Turnbull government and it is very much at the forefront for all of the members of parliament in this chamber. This bill is very important in this regard.

When it comes to our Department of Defence and to those who protect us and fight for us, there is nothing but admiration from me and my constituents and, I think, across the nation—because our defence forces, along with our intelligence agencies and police forces, do an outstanding job in keeping this nation safe. That does not mean that we do not have to look at ways to continually improve the way that our defence department does things, and that is what this review is all about.

In 2014, the government commissioned the first principles review of Defence. The focus of the broad-ranging review was on ensuring Defence is fit for purpose and able to respond to future challenges and deliver on its mission efficiently, while ensuring the maximisation of the resources which are allocated to our defence forces. The report of the first principles review was released on 1 April 2015, and the government has subsequently agreed to 75 of the 76 recommendations it made. The review, it would have to be said, made some confronting findings. For instance:

The current organisational model and processes are complicated, slow and inefficient in an environment which requires simplicity, greater agility and timely delivery.

The government has, therefore, undertaken a series of steps to help make Defence more efficient, whilst strengthening Defence capabilities to ensure that Australia is kept safe. The review found there was an unnecessary number of management structures and processes. This has produced an organisation with unclear accountabilities, which, in turn, has caused institutionalised waste and hindered important decision-making mechanisms. These are fairly important findings which the government has had to act upon. The complicated management structures have caused unnecessary duplication and over-escalation of issues for decision and restricted engagement amongst some employees in some parts of the organisation. When you think of the threat environment currently, you can see why these issues need to be dealt with.

One of the examples pointed to was that the number of Defence senior leaders has nearly doubled, growing from 201 in 1998 to 374 in 2014—that is an 86 per cent increase. When you compare that with the total number of other staff, which has risen from 73,000 to 78,000—an increase of seven per cent—you really see a contrast with what has happened in the senior levels of Defence. Furthermore, more than 60 per cent of Defence managerial staff supervise fewer than two other staff members. This is far fewer than the five to eight staff recommended by the Australian Public Service Commission and which is more consistent across the rest of the Public Service.

The first principles review proposes substantial changes across Defence to ensure it can deliver on future requirements. This reform is absolutely essential for implementing the requirements and priorities which will be recommended in the government's forthcoming Defence white paper. The government wants to provide the vision, and, obviously, it will be left to Defence to implement that vision. We have to ensure that Defence has the capabilities, the wherewithal and, in particular, the management structures to be able to do this.

The review stated that there were three root causes that have made Defence an organisation that has become risk averse and resistant to change. First, the high operational tempo and increasing national security demands over the past decade have demanded high levels of the senior leadership's time and attention. Understandably, this has hindered natural internal reorganisation within the department. Second, the budget uncertainty under the previous Rudd-Gillard-Rudd government years saw $18.2 billion removed from the Defence budget from 2009-10 onwards. It is worth repeating that: $18.2 billion was removed from the Defence budget from 2009-10 onwards. This has led to reactive planning, deferred military capability and a hollowing out of enablers such as estate, and information and communications, technology. Third, a constant leadership churn from 1998 to the present, resulting in nine defence ministers with an average tenure of two years, six secretaries with an average tenure of 2½ years and five chiefs of the Defence Force with an average tenure of four years, has not been good for Defence. Obviously, a constant senior strategic leadership is vital for any organisation, and, in particular, Defence. This government is committed to fixing these root causes to ensure a stronger and more sustainable Defence Force.

A key recommendation of the review was to 'establish a strong strategic centre to strengthen accountability and top-level decision making' in Defence. The review referred to this as 'one Defence', the idea that the ADF, the defence department and all three services will act as one entity. This will hopefully address the substantial opaqueness around accountability at all levels and obviously create a unity of purpose across the organisations, which will enable everyone to ensure they are moving in the one direction in a very focused and organised way.

As part of the idea to form one Defence, the review highlighted the need to update legislation to formally acknowledge the key role played by the Chief of the Defence Force, the CDF, and the Vice Chief of the Defence Force, the VCDF, in the modern Australian Defence Force. This is the key purpose of this bill: to formally recognise the authority of the CDF and the VCDF. It will give full command of the Australian Defence Force to the CDF by removing all legislative limitations in the Defence Act 1903. It will also recognise the VCDF as the deputy of the CDF and it will recognise the service chiefs—Chief of Army, Chief of Navy and Chief of Air Force—as subject to the direction of the CDF.

This works through an unusual leadership construct that includes the joint management of Defence with the department secretary and the CDF. The construct does not necessarily align with the first principles review recommendations of clear authorities and accountabilities and simplicity. However, given the dual nature of the Defence organisation, which requires both military and public sector expertise, the government will retain this management structure. However, by clarifying and formally documenting the roles of secretary and Chief of the Defence Force, the bill will increase effectiveness, minimise duplication and simplify reporting lines. The bill will, of course, continue to retain the Governor-General's role in appointing the CDF and continue to acknowledge the Governor-General's titular role under section 68 of the Constitution. Strengthening the key military leadership roles of the CDF and VCDF will enable improved coherence and effectiveness in Defence command and decision making.

Currently the Defence Act provides that, subject to the powers of the minister, the CDF commands the ADF, and the service chief of an arm of the ADF 'shall, under the CDF, command the arm of the ADF of which he or she is Service Chief'. This presents a lot of accountability ambiguity. In fact, this lack of clarity in the accountability structure has been confirmed by legal advice to be legally ambiguous. The CDF's powers may be interpreted as being subject to—and potentially constrained by—the authority of the service chiefs to command their respective services. This uncertainty is compounded by other provisions of the existing Defence Act.

The review recommended three key legislative changes to formally recognise the command authority of the CDF and the VCDF: the CDF have full command of the ADF by removing the legislative limitations on the CDF's command power; the VCDF be recognised explicitly as the 'deputy' of the CDF, including the clarification that the VCDF has both command and administrative responsibilities in relation to the ADF, as directed by the CDF; and the service chiefs be explicitly subject to the direction of the CDF. This includes the removal of their statutory authority to ensure absolute clarity of the CDF's command and authority.

This bill also makes some other changes to streamline the legislative foundation of the ADF. The Defence Act does not recognise the ADF as an entity in its own right; rather, it encourages a view that the ADF is no more than a 'federation' of the three services. This outdated view is not compatible in the modern era, where military operations involve all aspects of the three services. The bill provides the foundation for a more unified and integrated Australian Defence Force.

  The bill streamlines the major components of the defence legislation. This means that the bill will repeal the Naval Defence Act and the Air Force Act. All substantive provisions of these acts will be incorporated in the Defence Act. These provisions include the acknowledgment of the Regular Army, the Air Force and the permanent Navy. It will also acknowledge the Reserve components of each of the services and the capacity for the Governor-General to call out the ADF Reserves under certain circumstances.

It must be stressed that the role of the service chiefs will continue to be a vital element of Defence capability. This bill does not seek to change their role, nor does it seek to lessen the chiefs' importance. Rather, the bill seeks to clearly define the management structures of the ADF and the Department of Defence.

The bill also amends the Navigation Act 2012 to ensure that all geospatial-intelligence functions are consolidated under the Australia Geospatial-Intelligence Organisation. According to the Defence first principles review, Australia currently does not have a unified geospatial information enterprise. It has a series of stand-alone organisations that collect, analyse, maintain and distribute single domain foundation geospatial information. They have separate systems, business models, workforce planning, internal governance and capability development processes, all operating with little reference to each other or to a coherent plan for collective action. This is inefficient and wasteful, especially in an organisation that has limited resources.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour, and the member will have leave to continue his remarks at that time.