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Defence dilemma: To buy or to build?

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4 December 2009 09:14

Australia does fighter planes differently to submarines. Both bits of kit cost humungous amounts of money. Planes, though, we buy from somebody else. The submarines, we build ourselves.

This fundamental difference is why the plane decision is starting to look relatively straightforward for the Government. The submarine conundrum is shaping as a gigantic headache — for some future government.

The Rudd Government has — gently and gingerly — pushed the 'go' button for the Joint Strike Fighter, with the initial purchase of 14 F-35s. The politics of the JSF are about the only solid part of this equation. As for ultimate costs and delivery times, who knows? Even the initial 14 planes come at 'an estimated cost of $3.2 billion'. The only firm thing in that phrase is the word 'estimated'. The JSF is a huge project for the Air Force. Many more estimates, much more analysis and plenty of head scratching by future Cabinets still await.

Yet in one crucial way, the JSF is easy — or as easy as anything gets in the multi-billion dollar world of defence spending and strategic forecasting. The easy bit: Australia has to pay and take delivery, but Defence does not have to deliver the plane.

The JSF will come with inevitable technical problems and cost blow-outs. The comfort for Canberra is that the US Air Force and the US Marines both need this plane even more than we do. As the Defence Materiel Minister expresses the sentiment, 'one of the important things about it that does give the Government confidence...is that the US is really throwing all of the resources that they have at this particular aircraft.'

The relaxation point for the JSF is where the worries start for the submarine. At present, Defence is 'delivering' a bit under two out of the six Collins submarines. With that as context, consider Greg Combet's acknowledgment that 'the extraordinarily complex task' of building the future submarine lies 'at the margins of Australia's present scientific and technological capacity.' Translation: we might just have the ability to build a new sub, or it could sink to the bottom.

This is a $30 billion dollar call. As Combet puts it: 'The design and construction of a fleet of 12 new advanced submarines will be without doubt the largest defence acquisition this country has ever engaged in. I would go as far as to say that it is possibly the most complex and sophisticated industrial project ever pursued in this country.'

Combet has called in the RAND Corporation to do a quick study on Australia's capacity to design a submarine. This work and the many studies that will follow will have one question throbbing just outside the formal terms of reference: Should we actually do this? Nothing is certain — the 12 subs figure is a pledge or a promise rather than a decision. Canberra has decided on the JSF, but we are several elections — and a couple of White Papers — away from the same moment for new subs.

Patrick Walters offers this judgement: 'The planned doubling of the submarine fleet does not enjoy a strong constituency on Russell Hill, let alone among senior naval figures who worry about the future capability of the RAN's surface fleet...There are no guarantees a post-Rudd government would fund his plan for a doubling of the submarine fleet.'

To put it another way: the Air Force is certainly happier with its JSF lot than Navy is with its submarine ambitions. It's a lot easier to take delivery than manufacture delivery.

 Photo by Flickr user adam.hyland, used under a Creative Commos license.

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