Penny Wong (SA, Australian Labor Party, Leader of the Opposition in the Senate) Share this | Hansard source

I move:

That a motion to censure the Minister for Defence, Senator Johnston, may be moved immediately and have precedence over all other business this day and be determined without amendment.

Question agreed to.

I move:

That the Senate censures the Minister for Defence (Senator Johnston) for:

(1) insulting the men and women of ASC by stating he 'wouldn't trust them to build a canoe';

(2) undermining confidence in Australia's defence capability;

(3) threatening the integrity of the Future Submarine Project, Australia's largest defence procurement, by demonstrating bias and failing to conduct a competitive tender;

(4) breaking his promise made on 8 May 2013 to build 12 new submarines at ASC in South Australia; and

(5) failing to protect Christmas and recreation leave and failing to demand a real pay increase for Australian Defence Force personnel.

The Abbott government's Statement of Ministerial Standards states in its opening sentence:

Ministers and Parliamentary Secretaries are entrusted with the conduct of public business and must act in a manner that is consistent with the highest standards of integrity and propriety.

It goes on to say:

… it is vital that Ministers and Parliamentary Secretaries conduct themselves in a manner that will ensure public confidence in them and in the government.

The Minister for Defence has breached these requirements in the Prime Minister's standards. He made an extraordinary attack on the Australian Submarine Corporation yesterday, an attack that insulted the company and its workforce, undermined confidence in Australia's defence capability and jeopardised the integrity of one of the nation's biggest-ever Defence procurement contracts.

It was the latest instance of this minister's unacceptable performance in a portfolio which is critical for our national security. It comes on top of a broken promise to build the Navy's new fleet of submarines in Adelaide and his plan which cuts the real pay of Australia's servicemen and servicewomen. This minister has lost the confidence of the defence industry because of his conduct. He has lost the confidence of the men and women serving in the ADF and he has lost the confidence of his own colleagues in the government.

As I have said, yesterday the Defence minister said he would not trust the ASC to build a canoe—a nasty, cowardly and gratuitous slur on the ASC and on the 3,000-odd people who work for the company. The minister should be censured for this insult. It is a kick in the guts for the men and women, from management to the shop floor, who work hard every day and take pride in the work they do and who play an important role in developing, building, maintaining and sustaining Australia's defence capabilities, the men and women we trust to keep our submariners safe. They do not deserve to be treated like this by one of the most senior ministers in the government.

Some of the ASC workers visited Parliament House yesterday, and one of those workers, Andrew Daniels, was asked by the media how he felt about the minister's comment. He said: 'It's pretty disgusting. There's 3,000 ASC workers across two states—South Australia and Western Australia—and we do our best. We maintain submarines and we also build AWDs. There is no way we would put at risk our sailors—Australian sailors—no way we would be giving them second-class work, shoddy jobs or anything like that. We give them the best. That is what our job is: to maintain the submarines, to build the best AWDs. And here we are, we're being trashed. Well, I go home to my family and this guy's telling me I'm useless, and I don't feel useless. It's pretty gutting to 3,000 workers in South Australia and WA, and it's not a great feeling to have your Defence minister, who you are out there doing your best job for for the country, and he is trashing it.'

This is the minister in charge of defence policy and defence strategy in this country. He is the minister responsible for making some of the most difficult and serious decisions a minister in government can make. He is responsible for Defence procurement—for planning, acquiring and maintaining the equipment of our military personnel. He is responsible for policies and decisions critical to the development of our defence industry. This is a minister who needs to display maturity, judgement and leadership, not petulance, prejudice and pig-headedness. Australia is not served well by a hot-headed Defence minister who trashes the reputation of a company and a workforce who are responsible for the sustainment of our submarine fleet and who are building our new air warfare destroyers.

Yesterday, the opposition expected the minister—as I think many people did—to come into the Senate after question time or during the Senate sittings last night to apologise, but he made no appearance. What he did do is come in this morning and sought to recast his insult as nothing more than a rhetorical flourish. These are thoughtless remarks by the minister. They undermine confidence in Australia's defence capability, they undermine confidence in the capacity and the ability of the ADF to do its job and they will undermine confidence in the Australian defence manufacturing industry.

These comments have been reported widely, including internationally—for example, in The Wall Street Journal. This is not just a slur on the ASC which will damage that company's reputation and commercial prospects; it damages perceptions of the wider Australian defence manufacturing industry—an industry which employs tens of thousands of people, which is important for our economy and which is strategically important for the nation's defence capabilities. We should have, and the country deserves, an Australian defence minister who is working with that industry and championing that industry, not going out of his way to damage its reputation.

I am concerned, as are people on this side of the chamber and outside, that what we saw in Senator Johnston's outburst yesterday was a glimpse into the mindset of the Abbott government. It is a mindset which is prejudiced against the Australian build and a mindset which is prejudiced against the ASC—a prejudice which has tainted the Abbott government's whole approach to the future submarine project. That is the only explanation for why this government has spent months backgrounding against this company and these workers. It is a mindset prejudiced against Australian shipbuilding. We saw that when they barred Australian shipbuilders from even tendering to build the new supply ships, a decision which will ensure that jobs that could have been had in Australia are sent overseas.

I want to return to the issue of procurement and the integrity of the procurement process. We say that the minister's comments have compromised the integrity of the procurement process for the future submarine project. When it comes to procurement, this portfolio is the biggest of any portfolio in the Australian government—billions of dollars of government spending are involved. The commercial prospects of hundreds of manufacturing firms and the jobs of thousands of workers around the country are affected by defence procurement decisions. For this reason, these processes need to be above reproach. They must be conducted in a manner which promotes competition and value for money, in a way which is fair and equitable to industry and in a way which is free from bias, prejudice or favouritism.

These are principles which are laid out in a number of important documents which govern defence procurement. First, the CPRs, the Commonwealth Procurement Rules, which state:

All potential suppliers to government must, subject to these CPRs, be treated equitably based on their commercial, legal, technical and financial abilities …

This minister did not treat ASC equitably when he said that he would not trust it to build a canoe. The department's Defence Procurement Policy Manualsays factors to be considered when identifying the risks associated with procurement include the risk of a breach of ethics and probity in the tender evaluation process, including through bias. The minister's comments about ASC have jeopardised the probity of the future submarine procurement by displaying bias against a potential Australian supplier.

The Department of Defence's guide cautions against probity concerns. It cautions against concerns which might involve, for example, allegations of bias in favour of particular solutions or suppliers and risks to the competitiveness or fairness of future defence procurement processes. I say to the chamber that bias and risks to the fairness of future defence procurement processes is exactly what we saw from this minister yesterday and, I regret to say, it is exactly what we are seeing from the approach that the Abbott government is taking to the future submarine project.

The principles of fairness, transparent processes, equitable treatment and the avoidance of bias or favouritism are central to probity of procurement. The minister's behaviour, his comment that he would not trust ASC to build a canoe, absolutely flies in the face of these principles. What it suggests to any fair-minded observer is that he is biased against that company. It suggests that he has prejudged its capacity to be involved in the future submarine project before it has even been given an opportunity to put its case or make its bid. The minister's comments undermine the ability of Defence to conduct a fair, equitable and ethical procurement process. That is an issue for the Prime Minister, not only an issue for this chamber.

I have dealt with what the defence minister said. I have dealt with some of the impact of his comments on the company, on the workers and on the integrity of the defence procurement process. I would like to make some comments as to why he said it, because I think that everybody knows—observing the conduct of this minister in this chamber as the opposition and other crossbenchers have asked him questions, observing what has occurred in Senate estimates and observing what has been put into the paper—that very clearly all of this is about justifying breaking another promise. We know that the defence minister went to Adelaide last year, called a press conference in front of ASC's shipbuilding facility and said the following:

… I want to confirm that the 12 submarines as set out in the 2009 Defence White Paper and then again in last Friday’s Defence White Paper are what the Coalition accepts and will deliver.

We will deliver those submarines from right here at ASC in South Australia.

That was the promise before the election. What has been very clear, patent and obvious in the last months—as we have watched what the Prime Minister's office have backgrounded the media and what this minister has said here in this chamber and outside—is that all of that activity has been about justifying a broken promise. In many ways, one of the worst faults of this minister is not only that he was prepared to trash the workers and the ASC but that he was prepared to do it as cover for his broken promise. I think that is a fundamentally dishonourable thing to do. Instead of fronting up and telling people what the truth is, you try to denigrate those workers whom we trust, you try to denigrate that bidder, you want to knock them out of the bid to justify a decision that you know you either have made or will make—which breaks another election promise.

What we know since the election is the government has abandoned this promise and that is why yet again today in question time this minister would not repeat it. I gave him the opportunity to repeat what he told Australians and those workers in May of last year, and again he declined to do so. This government has abandoned this promise, as it has abandoned so many other promises. This government wants to acquire submarines from overseas. We know this from the Prime Minister's office backgrounding of the media from Japan. This is why this minister has made his extraordinary attack on the ASC, because he is attempting to justify the breaking of this promise.

The Abbott government is abandoning South Australia's defence manufacturing industry, just as it abandoned our auto-manufacturing industry. This government will jeopardise thousands of jobs in South Australia. It will jeopardise small- and medium-sized businesses in South Australia and across the country that rely on defence contracts for economic opportunities. It will damage the viability of our shipbuilding industry nationally—a strategically important part of Australia's advanced manufacturing industry, an important source of jobs in our nation, an important source of advanced technical and engineering skills, an important source of sophisticated technological management and organisational capability. All of these things are essential for any country that aspires to have advanced and competitive manufacturing industry. All of this is at risk because of this government's broken promise on the future submarine project.

This censure motion also refers to the cut in real pay and conditions of the members of the ADF. That is what we are seeing under this government, and it is a disgrace. Under this government, we will see the pay rates of Australia's service men and women go backwards in real terms over the next three years. Under this government, we will see ADF pay not keeping up with inflation over the next three years, meaning the men and women who serve our nation will not be able to keep up with the rising cost of living. Under this government, we will see members of the ADF lose their Christmas leave and other days of leave. Yet we have a minister in this place who said people will not lose anything. Again, this is another case of the Prime Minister saying one thing before the election and doing another thing afterwards. Who could forget Mr Abbott—