Mark Bishop (WA, Australian Labor Party) Share this | Hansard source

The motion before the chair is in some respects most unfortunate. It misrepresents the factual situation in a very deliberate and partisan way. It is as though the opposition believes or seeks to assert that two years of the Gillard government is totally responsible for the aggregation of problems that bedevil Defence and challenge government ministers of either persuasion. Let me acknowledge two matters at the outset: first, I readily concede that there are significant ongoing structural problems facing Defence, the defence community and what is commonly known as the defence family; second, I assert that the only way to permanently and properly address those matters is primarily through a bipartisan approach of the major parties likely to hold the Defence portfolio in government. So at the outset I do criticise the opposition for bringing in an overtly partisan motion on defence to the Senate yet I proffer a solution in my remarks that is, at its heart, structurally non-partisan.

Let me say also that our government brings good form to this debate, a considered approach and a set of significant achievements over its four years in government. Let me outline our form in one respect only to put it on the public record. The then opposition in the period from 2000 to 2007 spent an inordinate amount of time getting on top of important issues in defence, with inquiries, parliamentary committees, committees of review, relationship building with Department of Defence officials and, critically at the time, strong support to Howard government proposals for acquisition or reform. That work resulted in the white paper 2007-08. That critically resulted in the development of a strategic reform plan, worked out in conjunction with the service chiefs.

It was agreed we needed to find $20 billion in savings over a 10-year period. That agreed level of savings was done by negotiation with the service chiefs and through engagement with industry. The key decision was to plough all of those savings back into Defence budgets.

The first two years of the strategic reform plan worked well. Savings targets were achieved. Moneys were ploughed back into Defence budgets. Capability acquisitions were fully funded—in fact, so overfunded that some funds were returned to government. The net of that two or three years work is that the strategic reform plan instituted and implemented by this government has been working well. But I do not say for one minute that it is enough. It is only a start and can only be a start.

Why do I then say we need to have a revised, renewed and reinvigorated bipartisan approach to Defence matters? I say that because in the last two weeks the Senate Foreign Affairs, Defence and Trade References Committee has tabled a major report into Defence procurement, which is at the heart of the defence budget—the subject matter of the MPI before the chair today. That references committee, as we all know, is chaired by an opposition senator. There are three or four opposition members, only two government senators and one Greens or Independent senator. It spent 18 months on its inquiry and delivered a unanimous report with a unanimous set of findings and a unanimous set of recommendations. Major budget and account issues were discussed between the members and agreed between the members and they offered a considered way forward to a promised land of achievement and satisfaction in Defence.

Everyone in the Defence community knows the principal problems in Defence procurement are cost blow-outs, schedule and time delays, and flawed risk analysis. In any project that has gone overboard in the last 20 years, any one or all three of these problems were the cause. Why does that continue to occur year in year out under successive governments, successive ministers, successive chiefs of defence, successive service chiefs and successive departmental secretaries? Only this week we saw the appointment of a new departmental secretary—roughly the 4,000th in the last 16 years. It is really just not good enough when soldiers are dying at the other end of the world.

Let me put on the public record a potential solution which, if faithfully implemented, might overcome this recurring, useless, tired set of problems which seem apparently intractable but which are not. I suggest we adopt four principles for Defence budgeting, Defence accounting and Defence management: accountability, transparency, responsibility and empowerment. Apply these four principles across the board to the military arms, the civilian workforce and the DMO within the wider Defence community. In practice, it means organisational change and significant streamlining. Firstly, empower each service chief, not a committee, with full responsibility for all facets of project delivery post second-pass decision by government. Secondly, restructure the DMO so it becomes a specialist acquisition agency, independent of CDF and reporting to the minister, that is properly a centre of excellence in a critical world. Thirdly, provide for a targeted, yet limited, strategic role for the Capability Development Group. Fourthly, eliminate the competition between sectors of the Defence community for technical and engineering capability.

What we have at the moment between each of the services, the DMO and the Capability Development Group is the most useless, senseless, worthless and expensive form of competition for recruitment of highly skilled labour in engineering and technical capacities. You could not manufacture a greater waste of time than the Navy, DMO and the Capability Development Group competing to attract and retain the same group of highly skilled technical and engineering people. The net result has been that the DMO has hundreds and hundreds of vacant positions on the engineering side of its organisation. The Capability Development Group needs to take advice from Navy. But guess what? The Rizzo review and the other report that came down revealed in considerable detail that Navy has just about zero engineering capability. It has been run down and run down over the last 15 or 20 years—really since the 1988-89 period. It is inconceivable when you think about trying to run the most technically advanced warships in the world, which at their heart are nothing other than floating electronic factories, that the Navy has vacancies in the hundreds and hundreds for engineers and like classifications.

The fifth thing that should occur is that we should inject real contestability into decision making and guarantee that whichever government—our government or the coalition's government—is provided with independent advice from key agencies. That is sound, thought-out, thorough and independent advice from the DMO, the DSTO and technical experts, because all the floating set of committees we currently endure do is sieve out and reduce to very senseless and basic propositions very complex issues that do not get the attention of government. That is one of the root causes of why projects go bad, remain bad and continue to get worse for five, seven or nine years until all of a sudden some minister gets a file on his desk 10 years after the project commenced and has to do a presser and cancel $1.6 billion—just write it off—because the platform will not fly or sail or anything it was designed to do.

With any problem or set of problems there is always a solution, and the solution is at hand. (Time expired)