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

I move:

That the Senate take note of the answers given by the Minister for Defence (Senator Johnston) to questions without notice asked by the Leader of the Opposition in the Senate (Senator Wong) and Senator Conroy today relating to the manufacture of the next fleet of Australian submarines.

This matter really is not being given the respect it deserves in this chamber. I think that anybody who has visited South Australia or lived in, worked in or read about South Australia would realise how important this issue is, how widely held and deeply felt this issue is. There are plenty of Liberal supporters in South Australia—not a majority, I might add; not enough to get into government, but there are plenty of them there—and they view this decision by this minister and this government with clear disdain. This is not a decision which anyone in South Australia will support this government on. People may have a view of the budget, a view of the fiscal world, but they are very, very clear on the need to retain a manufacturing base in South Australia—retaining high quality, high skill, high-value jobs in South Australia.

Let us put on the record some of the comments of a couple of those very solid Liberal contributors. Let us take the member for Hindmarsh, Mr Matt Williams. He has written to his Prime Minister exhorting him to make a different decision, imploring him to make a decision in the seat of Hindmarsh. Let us take our own good Senator Fawcett, who put out a press release as late as last week saying that he fully supports the design build—well, let us read it. Let us go straight to the source:

I am a strong advocate for building the next submarines in Australia.

My views in summary are:

That is not from the Labor side; that is from the Liberal side. Let us have a look at what the former leader of the Liberal Party in South Australia, the now Minister For Defence Industries as well as a number of other portfolios, who says very, very clearly what the situation is. Mr Martin Hamilton-Smith takes complete umbrage at this decision, saying:

'It beggars belief that any federal government would seriously consider spending up to $250 billion of Australian taxpayers' money on buying naval ships from overseas …

Mr Hamilton-Smith said there were 27,000 defence jobs in this state, including 3000 in ship building, and 'industry activity worth hundreds of billions of dollars over 30 years that hinge on this decision due in the coming year'.

Those are just a few comments, not from our side of the chamber, not from our side of politics—although I must say that Martin-Hamilton Smith is a very valued member of the Labor government in South Australia, which manages to convince the electorate and, I might say, the general population of the value of manufacturing to our state.

This crew opposite chased the automotive industry out of town. They chased Holden out of town. They basically said, 'Put you dollars down or get out.' Now they are making a similar sort of mistake on the long-term viability of manufacturing in South Australia, and it is absolutely criminal. It is a very, very bad, short-sighted view to have taken. Even the current leader of the Liberal Party in South Australia, the honourable Steve Marshall—he is not quite 'the Hon.' yet; he never made it, but he may one day—is out there castigating this decision, the mishandling of this. He is out there castigating this decision—the mishandling of this. What did Senator Johnston say? He said: 'We will be doing it. We will be building 12 submarines in Adelaide.' And then he said: 'We will be picking up, if we win the next election, the cudgels for this project as fast as we possibly can.' What did we see in question time today? (Time expired)

Concetta Fierravanti-Wells (NSW, Liberal Party, Parliamentary Secretary to the Minister for Social Services) Share this | Link to this | Hansard source

It was very clear from Minister Johnston's intervention today that the five or six years under Labor were characterised by absolutely no contracts and no obligations. It is hypocritical for Senator Gallacher to come to this place, stand here and berate us on this side after Labor's appalling legacy in this space. This is a government which will make decisions on naval matters and on defence matters. And we will make those decisions for the right reasons. It is vitally important that Defence acquisitions have to be made on the basis of Defence logic—not industry policy, not regional policy, but on the basis of sound Defence policy.

As Minister Johnston has said, we have not yet made a final decision on the design and the build of the next generation of Australian submarines. What we do know is that we will be having more submarines. The bulk of the work on this project will be centred around the South Australian shipyards to take advantage of the work that has been done in that area over many, many years. This, of course, is consistent with our pre-election commitment. Labor in government failed to make a vitally important decision in relation to submarines over the six years they were in government. It is important now that we move quickly to fill this capability gap, because, as the minister said, it is now a decision about avoiding a capability gap.

It was demonstrated very clearly by the minister in his answer to Senator Conroy that when he opened box SEA 1000—

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

It's a credibility gap.

Concetta Fierravanti-Wells (NSW, Liberal Party, Parliamentary Secretary to the Minister for Social Services) Share this | Link to this | Hansard source

the box was absolutely empty. In fact, there were actually cobwebs. You sat on your hands for five or six years and did absolutely nothing about it. Now you are coming in here bleating and crying crocodile tears and indulging in what can only be—

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

What are you talking about?

Concetta Fierravanti-Wells (NSW, Liberal Party, Parliamentary Secretary to the Minister for Social Services) Share this | Link to this | Hansard source

only be described as absolutely hollow acts. For example, I want to quote the joint media release of my Liberal colleagues in South Australia—

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Oh dear, how embarrassing.

Gavin Marshall (Victoria, Deputy-President) Share this | Link to this | Hansard source

Order!

Concetta Fierravanti-Wells (NSW, Liberal Party, Parliamentary Secretary to the Minister for Social Services) Share this | Link to this | Hansard source

You indulge in this hollow union pledge of promising to advocate that all naval ships and submarines are to be designed, built and maintained in Australia. This is meaningless, because we all know that in Defence matters it is vitally important that we do work, and we have been working, with other countries for decades. The Collins-class submarine was a Swedish design—the company Kockums and US combat systems by Rockwell and French power and propulsion by Jeumont Schneider. The Air Warfare Destroyer was based on a Spanish design by Navantia with combat systems manufactured by the US company Lockheed Martin. International cooperation has long been a feature of Defence matters.

Senator Conroy interjecting—

Senator Conroy, let me tell you that having spent many years married to Commander Wells, who was in the Navy for 35 years—

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

Was he a submariner?

Concetta Fierravanti-Wells (NSW, Liberal Party, Parliamentary Secretary to the Minister for Social Services) Share this | Link to this | Hansard source

I can say modestly that I do know something about Defence matters. What we do know is your appalling legacy during the time that you were in government. We have stopped the Defence cuts and have increased spending on Defence. Your period in government was one of the poorest for spending in Defence. Under Labor Defence spending as a share of GDP dropped to 1.56 per cent in the 2012-13 budget—which is the lowest since 1938. In 2012-13 Labor's 10.5 per cent cut to Defence was the largest single cut since the Korean war. Immediately following on your 2009 white paper, Labor cut or deferred $16 billion from the defence budget out to 2016-17. (Time expired)

Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Link to this | Hansard source

I rise to take note of these answers given by the Minister for Defence on submarines. I will very much enjoy taking the opportunity to set some facts on the table. I know Senator Birmingham wants to flee the chamber before he gets ousted as being the senior Liberal source in South Australia who says this government has completely mishandled the submarine issue in South Australia.

Let me remind this place of the coalition's solemn promise to build 12 submarines in Adelaide. In May last year the now Defence minister stood outside the ASC in Adelaide and this is what he said:

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

Standing right next to him was the South Australian Liberal leader and this is what he said immediately afterwards:

The State Liberals welcome the Coalition’s confirmation today that 12 submarines will be built in Adelaide under a Coalition Government..

A unity ticket! Senator Johnston and the leader of the opposition in South Australia guaranteeing everybody in South Australia that 12 subs were to be built in South Australia. So maybe, just maybe, that is why the state Liberal leader is so angry at the handling of this issue by his federal counterparts. That is right—Mr Steven Marshall was in the press yesterday blaming the defence minister's broken promise for a fall in his support in South Australia. The South Australian Liberal opposition leader, who happened to be standing next to Senator David Johnston outside the front gates, is blaming the federal government—Senator Johnston, Senator Abetz, and Senator Birmingham and all those other South Australian Liberal senators who have rolled over and abandoned employment and abandoned families in South Australia. A federal Liberal MP from South Australia told The Australian that the submarine issue had been handled 'very badly'. So your own MPs are coughing you all up. You have handled it very badly. What he means by that is: you have told a lie. You made a solemn promise to the people of South Australia in the lead-up to the election and you have broken it.

This decision puts at risk thousands of jobs in South Australia and across the country. It also puts at risk our strategically vital submarine-building and shipbuilding industry. It is not just Labor who has warned about the dangers of this broken promise. As was mentioned earlier in question time, last year the former Chief of the Defence Force of Australia, our current Governor-General, Sir Peter Cosgrove, wrote that it would be a tragic loss to our country if we were to lose our submarine-building capability. Let me quote then General Cosgrove:

Whenever I am asked why we should build submarines in Australia, my short reply is that we can’t afford not to.

He concludes his article by saying:

Let’s use confidence and common sense and build the subs here.

There is a complete lack of common sense coming from the government on those issues. What we are seeing here is a complete capability gap and, more importantly, a credibility gap from the Minister for Defence, Senator Johnston. Every single submarine expert in this country is condemning this government's decision, for very good capability reasons. I invite those who are interested to listen this afternoon and evening to a Senate hearing into this very issue, where the country's top experts will explain exactly why this government is so deceitful. (Time expired)

Christopher Back (WA, Liberal Party) Share this | Link to this | Hansard source

Why do the Labor opposition keep giving us these opportunities? I just cannot believe it. It started the other day with an MPI from Senator Moore and it just gets better. Isn't it amazing what an expert Senator Conroy is in opposition? What an amazing expert in submarines he is in opposition. What a shame Senator Conroy did not say too much when he was a senior minister. As my leader just said, if there is a capability gap, I think it is between Senator Conroy's left ear and his right ear. Nevertheless, I think that jokes about a 'hunt for red October' will start to flow out.

Isn't it also incredible that the now Leader of the Opposition, Mr Shorten, seemed to be very silent when he was a senior minister? Here he was on 7 September demanding that the government promise to keep building submarines in South Australia. Where was he when Mr Rudd was Prime Minister, when Ms Gillard was Prime Minister and when Mr Rudd was Prime Minister again? Where was he in keeping Mr Rudd up to his promise that, 'A Labor government would ensure the submarines were built by ASC at its Port Adelaide site, with construction to begin in 2017'? Where were you, Senator Conroy, when Mr Rudd ripped $20 billion out of the defence project?

It is amazing that poor old Mr Shorten did not realise that his good mate Labor MP Mr David Feeney was going to be standing behind him at the great rally at ASC, because it was poor old David Feeney that belled the cat. At the rally he said, 'Australia's shipbuilding and submarine-building industry are now at the crossroads.' You bet they are at the crossroads. Who put them there? Who put them in the Conroy cul-de-sac? Who put them in the Feeney dead end? It was the Labor government of the day. They took $20 billion out of the submarine contract, with the complicit involvement of the South Australian Labor government. Don't forget that they were involved in this, Senator Conroy, while you turn your back to this discussion. They then turned around and took another $16 billion, much of which would have gone to the South Australian defence procurement and materiel organisation.

I turn to the comments made by Senator Johnston in response to the pathetic questions by the Leader of the Opposition in the Senate, Senator Wong, and her deputy, Senator Conroy. Senator Johnston indicated two things—firstly, his intimate knowledge of matters defence, particularly submarines. He was asked why he made certain observations and why he made certain others. The explanation, through you, Deputy President, to those in the public gallery, would be that when a responsible government leaves government you would expect there to be well-formed plans into the future for something as important as a procurement program for replacement of the Collins class submarine. You would expect that plan would be well formed, that it would be well developed and that it would be there for a new government to pick up and to carry on with, with or without modifications. When Senator Johnston, as defence minister, picked up that file, it was empty. Don't worry too much about the protestations of the people from the other side. I ask Senator Conroy and Senator Wong, a South Australian senator, a finance minister of the day: why were there no future plans for that gap in capability once the Collins class submarine was to be replaced? It was Senator Johnston who, in opposition, was so well versed in this portfolio that he was able to tell us here today the down time for the Australian Collins class submarine, the German submarine and the Japanese submarine. I think he said it was eight months for the Japanese, 11 months for the German and 18 months for the Collins class.

Whilst we move towards the white paper, let us not forget that the estimate for the cost of the replacement submarines, should they be built in Australia exclusively, is some $40 billion. The figures that I have seen—and I believe they are in the public arena—for German or Japanese submarines are half of that price. I defer again to my colleague Senator Fawcett, a man with an enormous amount of experience in this field, who has spoken of the fact that the Collins class submarine was initially designed by the Swedish and built with Swedish, US and French involvement. Senator Fawcett is very wisely saying that that type of process can work into the future for the benefit of Australia and South Australia. (Time expired)

Anne McEwen (SA, Australian Labor Party) Share this | Link to this | Hansard source

I am very pleased to have the opportunity yet again to speak on the future submarine project, which is so important for my home state of South Australia. I thank Senators Wong and Conroy for asking questions about it again today.

We know that the government wants to break the promise that it made to South Australians before the 2013 federal election and again before the 2014 state election. That promise was to design, build and maintain the 12 new submarines in Adelaide, South Australia, at the Australian Submarine Corporation. We know that the Minister for Defence, Minister Johnston, has been sidelined in his own cabinet room in this debate because the bean counters are in control of defence capability in Australia, not the Minister for Defence and not the Department of Defence. This has become a matter of money when there are much more important issues at stake, including the security of our country.

We know that the opposition leader in South Australia is truly despairing of the ineptitude and indecision of his federal counterparts because they are unable to commit to the promises made before the state election. Mr Steven Marshall is well aware that the future of shipbuilding and submarine building in South Australia is the single most important issue playing out in South Australia at the moment. He knows that his federal colleagues are about to sacrifice over 20,000 jobs in South Australia's defence sector and to thereby condemn South Australia to a future without the high-tech shipbuilding jobs that are so important. For over 25 years there has been bipartisan support to build up the shipbuilding industry in South Australia, and it will take this government—this Abbott government—probably a couple of years to destroy it.

Today, through questions asked by Senators Wong and Conroy, we heard that there are also concerns from experts, not only about the potential economic disaster for South Australia but also about the potential disaster for defence capability that this government seems to be hurtling towards with its decision to design and build the new submarines somewhere other than Australia. We know that Japan has been considered for that, and we know that Japanese experts in shipbuilding have already been secretly to South Australia to have a look at the Australian Submarine Corporation; and we understand that Australian representatives are currently, or have been, in Japan to investigate the situation there. We know that the government is contemplating purchasing a Japanese-designed and built submarine despite the fact that Australia can and should build and maintain its own future submarines. We heard today that the current Governor-General and former Chief of the Defence Force, Sir Peter Cosgrove, said:

To outsource this work would be to export hundreds of billions of dollars of work to supporting another country’s industry and jobs, rather than investing in our own.

General Cosgrove said that to outsource that work would be short-sighted. We certainly know that it is short-sighted.

As well today, we heard that two former submarine commanders and members of the Australian Navy—defence personnel who do know what they are talking about—have questioned this government's intended course of action. They have questioned whether that Japanese submarine will meet Australia's defence requirements in terms of the range that a submarine needs, the endurance a submarine needs when it is operating in Australia and around Australia's waters, and in terms of the capability of that submarine. Those gentlemen are experts when it comes to submarines. They are very concerned, as are we in the Labor Party, about the future of Australia's submarine capability. We know that submarine capability is absolutely integral to Australia's national security and it is the one thing that we should not be outsourcing, it is the one thing that we should not cede control of. We are capable, we are more than capable, of maintaining and keeping this industry in South Australia and in Australia. This is an industry that we cannot afford to lose. We need to have a long-term view about the future of defence capability in Australia and I am pleased that Labor senators are fighting very hard for submarine jobs in South Australia.

Question agreed to.