George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Hansard source

Thank you very much indeed for the advance notice you gave me of this question, Senator Madigan, and I want to acknowledge your longstanding interest in this issue. The government is committed to supporting a productive and cost-effective naval shipbuilding industry in Australia. We are prepared to invest in the skills and knowledge base of the Australian naval shipbuilding industry. We have a very high regard for the workforce. We are prepared to commit to a long-term investment to ensure the industry enjoys a solid future in Australia.

The government recently received the RAND report that provides a solid evidence base to inform the development of the naval shipbuilding plan which will accompany the 2015 Defence white paper, which is to be released later this year. RAND's analysis found that Australia could sustain a surface shipbuilding industry by carefully managing a continuous shipbuilding strategy. However, RAND also found that the cost of building naval ships in Australia is 30 to 40 per cent greater than United States benchmarks and even greater than that against some other naval shipbuilding nations.

This premium can be reduced by improved productivity through a consistent production-build demand; a mature design at the start of build with minimal changes once production begins; and a well-integrated designer, builder and supplier team; matching the industrial base structure to demand and visionary leadership and management.

The 2015 Defence white paper and naval shipbuilding plan will provide increased certainty to the shipbuilding industry by outlining Australia's future naval requirements. Those plans will ensure that Australia does have a sustainable naval shipbuilding industry that delivers the right capability at the right time and for the right price, and supports shipbuilding jobs in Australia.