John Madigan (Victoria, Independent) Share this | Link to this | Hansard source

My question is to the minister representing the Minister for Defence, the Attorney-General, Senator Brandis. Over recent months there has been a lot of speculation about our shipbuilding industry, and where and how many submarines will be built to replace our Collins class fleet. Andrew Bellamy of Austal was recently quoted as saying the problems with the AWD program lie in the workforce and that he fundamentally believed that skilled Australian labour building ships with the right infrastructure, management and incentives can be as productive as anywhere else in the world. Do you and the government agree with that statement?

George Brandis (Queensland, Liberal Party, Attorney-General) Share this | Link to 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.

John Madigan (Victoria, Independent) Share this | Link to this | Hansard source

Mr President, I ask a supplementary question. Government procurement has great potential to assist a wide range of industries across Australia, including shipbuilding. What are the benefits for Australia of a fully local build for the 12 new submarines?

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

There are great opportunities, in particular for South Australia, in the Future Submarine program. The government expects that significant work will be undertaken in Australia during the build phase of Future Submarine, including combat system integration, design assurance and land based testing. This will result in the creation of at least 500 new, high-skilled jobs in Australia, the majority of which will be based in South Australia.

The Department of Defence has advised the government that, for Australian industry to have the best opportunity to maximise its involvement in the Future Submarine program, it needs to work with an international business partner. Based on work completed by Defence, France, Germany and Japan have emerged as potential international partners. All three countries have proven submarine design and build capabilities. (Time expired)

John Madigan (Victoria, Independent) Share this | Link to this | Hansard source

Mr President, I ask a final supplementary question. Minister, two of the things I believe in are that a country is what a country makes and that submarines are spaceships for the ocean. Will the minister commit to purchasing this Australian-made T-shirt in support of Australian manufacturing, jobs and charities?

Stephen Parry (President) Share this | Link to this | Hansard source

That is disorderly, Senator Madigan, but I will let the question stand.

Mitch Fifield (Victoria, Liberal Party, Assistant Minister for Social Services) Share this | Link to this | Hansard source

Do they have your size?

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

Senator Fifield took the words out of my mouth. I might need a slightly bigger size in that T-shirt, Senator Madigan! But, of course, I would proudly advocate for Australian industry, including by wearing such a fetching garment.