James McGrath (Queensland, Liberal National Party) Share this | Hansard source

It gives me pleasure to speak in this debate because I want to highlight that Labor were in power, allegedly, between 2007 and 2013. They were in power, they were in government, they were in ministerial leather but they were incapable of making a decision on the submarine fleet. Their failure to make a decision and their failure to think about the future defence needs of this country has risked a credibility gap between the ageing Collins fleet and the future submarines. Now Labor want to spend another five years on a tender process. It is rich of Labor, it is typically hypocritical of Labor to call for an open tender process given that back in 2007 Prime Minister Rudd said that Labor would bypass a tender process for submarines. Even Senator Conroy has conceded, in a masterclass in understatement regarding submarines, that it did not go as fast as everybody wanted. In fact, it did not go anywhere under Labor. They did nothing for six years while they were in-fighting amongst themselves.

In the Defence budget, Labor broke their commitment to guarantee an average of three per cent real growth in Defence spending to 2017-2018 and 2.2 per cent real growth to 2030 to fund the promises made in their 2009 Defence white paper. Defence spending under Labor fell to 1.56 per cent of GDP in 2012-13. This is the lowest level of Defence funding since 1938 and that was before the outbreak of the Second World War. They cut the budget for 2012-13 by 10½ per cent. That was the biggest cut to Defence spending since the Korean War. Now Labor come into this place and reach out with their alleged hand of bipartisanship. Actually, what they do is reach out with a hand of hypocrisy and a hand of insincerity in relation to the submarines. They want to talk about a fair and proper process—I was writing the words down while the Labor senators were speaking—and they want to talk about a fair deal for taxpayers. If you want to talk about a fair deal for taxpayers, we can talk about what Labor did in relation to debt. We can talk about what Labor left here on the ministerial desks and on the credit cards and in the savings accounts of Australians—that is, the huge debt that Labor left.

The independent Parliamentary Budget Office stated in mid-2014 that, without action, Australia's debt would grow at one of the fastest rates in the developed world. We are currently paying a billion dollars a month in interest payments. That is over $12 billion a year, for those senators opposite who are not very good at counting with their shoes on. That is enough to build a world-class teaching hospital in every capital city, enough to finish the duplication of the Pacific Highway and it is around half of the Defence budget. It is about the same amount as government spends on aged care. It is more than the cost of the Pharmaceutical Benefits Scheme. It is more than the cost of the National Disability Insurance Scheme. It is more than the cost of higher education spending.

So for Labor to come into the Senate and talk about what we are doing in relation to the submarines is disappointing and hypocritical, because we have to try and clean up the mess that Labor has left behind and ensure that we get the debt down so that we deliver better services for Australian taxpayers. We also need to deliver a submarine fleet that delivers value for taxpayers.

In terms of the acquisition strategy for future submarines we want to provide a pathway—based on a competitive evaluation process—which will maximise the involvement of Australian industry, while not compromising on capability, cost, schedule or risk. And Australia is going to need an international partner to deliver this program. France, Germany and Japan have all emerged as potential international partners, and they will be invited to participate in the competitive evaluation process that will assess their ability to partner with Australia to develop our future submarines.

As part of this evaluation process Defence will seek proposals from potential partners for pre-concept designs, options for designs built overseas or in Australia and/or a hybrid approach, and costs and schedules for each option. The future submarines program will involve an investment of around $50 billion over its full life, and it is very important that we deliver value for money for Australian taxpayers. That is what this government is going to do, rather than spitting out press releases for dirty, grubby politics, which is what Labor are currently doing.