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

My question is to the Leader of the Government in the Senate in his capacity as Minister for Finance and Administration, Senator Minchin. I refer the minister to Treasury secretary Ken Henry’s speech on 9 February when he said that the Defence procurement rules provide protection for taxpayers if they are followed correctly. Didn’t Mr Henry go on to warn:

Just keep in mind how exposed you might be if and when the whole thing turns pear-shaped and the world learns that you have flouted the post-Kinnaird procurement guidelines?

Can the minister confirm that he was not consulted prior to the defence minister’s announcement on 1 February that he wanted to buy 24 Super Hornet combat aircraft? Given that the two-pass procurement guidelines were not followed in this instance and the $4 billion cost is not in the Defence Capability Plan, what guarantees do taxpayers have that this acquisition will not go pear-shaped?

Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Link to this | Hansard source

I do not think the Labor Party should be lecturing us about Defence acquisition following their appalling record. The senator referred specifically to speculation with regard to the acquisition of the so-called Super Hornets. The government has made absolutely no decision to make such an acquisition. I note Dr Nelson’s comments. Of course, he is entitled to indicate his views about the way forward with regard to our air combat capability, as is his responsibility, but there has been no decision made to acquire those Super Hornets. As you know, we are proceeding down the path of the acquisition of the JSFs, and we have to balance that proposed acquisition against the life span of the F111s and the existing Hornets. There is speculation about whether Super Hornets may have a role to play in our air capability, but no decision has been made to acquire those Super Hornets.

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

I ask a supplementary question, Mr President. Don’t finance department officials participate in defence capability committees to help cost, evaluate and plan major project decisions prior to their announcement? Isn’t the minister himself an invited member of the National Security Committee of Cabinet when discussions include Defence projects? If the finance minister is not fully costing and scrutinising multibillion-dollar spending commitments, just who is protecting the taxpayers’ financial interests? Will the minister, on behalf of the government, guarantee that there will be full adherence to proper process in this particular procurement project?

Nick Minchin (SA, Liberal Party, Minister for Finance and Administration) Share this | Link to this | Hansard source

I can only repeat what I said in the first part of the answer: there has been no decision to acquire Super Hornets and no announcement to that effect. It is one of the virtues of the Kinnaird reforms brought in by this government, under the very good stewardship of the former Minister for Defence, Senator Hill, that the finance department does have a greater role in acquisition projects. Indeed, I do sit as an invited member of the NSC on all financial decisions, and I will certainly be taking a very keen interest in decisions relating to our air defence capability.