Alex Gallacher (SA, Australian Labor Party) Share this | Hansard source

I present the report of the Foreign Affairs, Defence and Trade References Committee on the planned acquisition of the Joint Strike Fighter, together with the Hansard record of proceedings and documents presented to the committee.

Ordered that the report be printed.

I move:

That the Senate take note of the report.

I am pleased to table this report of the Foreign Affairs, Defence and Trade References Committee into the planned acquisition of the F-35 Lightning II Joint Strike Fighter. Government, opposition, Australian Greens and the Nick Xenophon Team senators worked cooperatively during this inquiry, and I am pleased that the majority report recommendations have the support both of the government and the opposition.

The committee is satisfied that the F-35A is the only aircraft able to meet Australia's strategic needs for the foreseeable future, and that sufficient progress is being made in the test-and-evaluation program to address performance issues of concern. However, the committee is not convinced that any of the available alternative aircraft raised in evidence are capable of meeting Australia's air defence needs.

Nonetheless, in light of the serious problems that have led to the re-baselining of the F-35 program in 2012 and the ongoing issues identified by the United States Director, Operational Test and Evaluation, the committee retains a healthy scepticism towards assurances by Defence regarding cost, schedule and capability outcomes for the F-35.

The report makes three key recommendations for Defence and the government, focusing on: (1) the development of a hedging strategy to address the risk of a capability gap resulting from further delays in the acquisition of the F-35A; (2) the development of a sovereign industrial capability strategy for the F-35A to ensure that Australian aircraft can be maintained and supported without undue reliance on other nations; and (3) the establishment of Australia as the Asia-Pacific maintenance and sustainment hub for the F-35.

There have been significant changes to the acquisition schedule over the life of the F-35 program, including the recent re-baselining in 2012 and the limited scope and considerable cost to further extend the life of the Classic Hornet fleet. The committee therefore considers it prudent for Defence to develop a hedging strategy to mitigate the risk of a capability gap resulting from further delays.

The support solution for sustainment is still under development. However, the F-35's reliance on mission data loads produced by the US Reprogramming Laboratory, together with the Autonomic Logistics Information System and the global support model could impact on Australia's sovereign ability to make decisions around how, when and where we deploy capability.

The potential for other nations to be prioritised over Australia for the provision of repair parts and for the development of software—for example, mission data files and electronic warfare—may negatively impact on Australia's capability. A balance must be found between the benefits of the global support solution and preserving an acceptable level of sovereignty regarding the maintenance of Australia's capability. As such, the committee strongly supports Defence's efforts to develop mission data reprogramming capabilities in Australia. Further, the committee encourages efforts to establish Australia as the F-35 Asia-Pacific maintenance and sustainment hub. This would have the dual benefit of increasing Australian industry participation in the F-35 global support solution as well as developing in-country maintenance and support capabilities.

The F-35 program has had a positive impact on Australian industry and indeed the Australian economy. As a result of being able to compete for business in global F-35 program supply chains, and with the support of government programs, Australian companies have won a number of significant contracts and secured over US$554 million worth of design and production work. This figure is expected to increase significantly over the life of the program as it matures, resulting in rising production volumes and future sustainment opportunities.

Australian industry submitters and witnesses told the committee they have received a range of benefits from their involvement in the F-35 program, including: capability and network development; job creation; long-term investment; increased skills and experience; and opportunities for future work. The committee was pleased to hear that the F-35 program has delivered considerable employment opportunities to Australian industry as well as helping to offset declining employment rates—in particular, in the automotive manufacturing industry—by engaging a large number of people out of its engineering and manufacturing workforce.

Throughout the inquiry, the committee received evidence criticising the F-35A and raising concerns regarding the aircraft's performance in testing and subsequent delays in acquisition time lines. Submitters and witnesses raised concerns regarding the F-35's manoeuvrability and flight capabilities, stealth capabilities, mission systems, mission data loads, Autonomic Logistics Information System and escape system. Many submitters called for the aircraft's procurement to be cancelled. It is difficult to accurately understand and critique the capabilities of the F-35 without access to detailed classified performance data. As such, the committee does not draw definitive conclusions regarding the details of the aircraft's performance in testing in its report. For the same reason, the committee is sceptical of the accuracy of analysis and conclusions calling into question the suitability of the F-35A—noting that these submitters do not have access to the classified information necessary to accurately assess the capability of the F-35A, nor do they have access to classified information regarding current generation Russian and Chinese developmental aircraft.

However, even if the submitters' data and conclusions were beyond doubt, the majority of submissions which argued against the procurement of the F-35A asserted that Australia's only alternative is to acquire the F-22 Raptor. As this aircraft is not in production, is unlikely to ever be reinstated to production and its sale to any foreign government remains prohibited by the United States congress, the committee is unconvinced that the F-22 is a realistic alternative to the F-35A. Furthermore, the evidence was not able to demonstrate that alternative aircraft such as the JAS-39E Gripen, the Eurofighter Typhoon or the Dassault Rafale would be better able to meet all of Australia's requirements.

The committee therefore concludes that the F-35A remains the only currently viable aircraft that is capable of meeting Australia's near term strategic needs and, as such, should be a key element of Australia's air combat capability. I commend the report to the Senate.