Nicolle Flint (Boothby, Liberal Party) Share this | Link to this | Hansard source

My question is to the Minister for Defence. Will the minister update the House on how the government has created jobs and opportunity through the capability-building projects that Australian service men and women rely on? How might alternative approaches undermine these projects and threaten jobs, including in my electorate of Boothby?

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

I thank the very hardworking member for Boothby, who is delivering for the residents of her electorate and will continue to do so years into the future, for her question. Because we have delivered a surplus budget for next year, because of good economic management and because of a growing economy, driven by good economic management from this side of the House, we can afford to have the biggest build-up of our military capability in our peacetime history, because we can afford to pay for it. We can afford to pay for it, because we are running balanced budgets and helping to grow the economy, because we're taking the burden off small and medium enterprises and because we are making multinationals pay their taxation. We are running the revenues that allow us to invest in our military capability.

Just last week we saw the impact of this in an Oxford Economics report about the Hunter-class anti-submarine warfare frigates program. That economics report found that the frigates program will put $17 billion into the national economy. It'll create 6,300 jobs at its peak—even more than we had anticipated. Five-hundred Australian companies are already prequalified to work on the Hunter class frigates project, and it's using 48,000 tonnes of Australian steel, which, of course, wouldn't be available if the Labor Party were in office, under their energy policies, because the steel industry would be put out of business. The 48,000 tonnes of steel will be coming from Australia.

This is in very stark contrast to what we saw under the Labor Party. Because of their budget management, because the economy was not growing in the way that it is now and because they weren't running balanced budgets, they had to cut defence spending, and they did. They cut defence spending. In 2010-11 they cut defence spending by 6.4 per cent in real terms. In 2011-12 they cut it by 2.3 per cent in real terms. In 2012-13 they cut defence spending by a whopping 9.2 per cent in real terms. In total they reduced defence spending in those three budgets by 17.9 per cent—by almost a fifth. That's why they couldn't make the decisions about projects like the anti-submarine warfare frigate program. They couldn't commission any vessels in six years, because they were cutting defence spending. Instead, we've commissioned 55 vessels. The most recent is the HADR vessel for the south-west Pacific. We have completely transformed the naval shipbuilding program, unlike Labor.