The Hon Pat Conroy MP
30 Oct 24
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The Hon Pat Conroy MP
Minister for Defence Industry and Capability Delivery
Minister for International Development and the Pacific
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6 August 2024
I begin by acknowledging the traditional owners of the land, the Gadigal people of the Eora Nation, and pay my respects to their Elders past and present.
As the Minister for Defence Industry and Delivery Capability Delivery, I also pay my respects to Aboriginal and Torres Strait Islander men and women who have served our nation in the past and continue to do so today.
And I thank current and former Australian Defence Force personnel for their service.
Thank you Peter for your introduction.
My thanks to Phil Tarrant, Liam Garman and Will Magee and the rest of the Defence Connect and Momentum Media Team for inviting me here today.
You provide an invaluable channel for industry and academia to stay up-to-date and gain valuable insights, with about 150,000 visits each month via Defence Connect I am told.
And that’s music to my ears.
Because connecting with industry has never been so important.
Both the Defence Strategic Review and the National Defence Strategy are clear – we face the most strategically complex environment since the Second World War.
Requiring a total reassessment of military capability as we go deeper in the 21st century.
Industry is at the core of this mission. An industry forged by the most challenging of circumstances.
It was here in Sydney at an engine factory in Lidcombe during the Second World War that the twin-row Wasp engines were produced for the legendary Beaufort bomber, the workhorse of the RAAF.
This was part of Australia’s historic and time critical effort to build its own military aircraft, bringing new skills, such as precision engineering, into Australia.
The deteriorating strategic environment at the time necessitated an urgent industrial capability uplift, creating jobs.
Though we are thankfully not at war, we do face urgent challenges today.
The Albanese Government is addressing these challenges through the Defence Industry Development Strategy.
The Strategy articulates for the first time what kind of sovereign defence industrial base we need.
It delivers a whole-of-government, whole of nation approach to developing the capability and capacity of the sovereign defence industrial base in priority areas.
And there has never been a more important time for industry to take its seat at the national defence table.
Australia no longer has a 10-year strategic warning window to prepare for conflict.
Our strategic approach is one of deterrence and reassurance.
Our rebuild of the Integrated Investment Program, allocating $330 billion dollars over the decade to 2033-34, is the strongest signal of our intent to deny and deter.
Funding among other things:
- A historic conventionally-armed, nuclear‑powered submarine capability.
- The most capable anti-submarine warfare frigates in the world.
- Tripling of the Navy’s vertical launch missile capacity.
- Boosting the Army’s long range firing capacity to 500 kilometres.
- And an unprecedented boost of guided weapons and ordnance manufacturing capability.
The Government is developing the sovereign defence industrial base at a time when Australia is reprioritising our broader manufacturing ecosystem.
This is being done through the Future Made in Australia package and the National Reconstruction Fund, one of the largest peacetime investments in Australian industry and Australian manufacturing.
And our defence industry is already well placed to grab these opportunities:
To create jobs:
Look at the historic $3.1 billion export of more than 100 Boxer Heavy Weapon Carrier vehicles being built by Rheinmetall in Queensland for use by the German Army…
This will generate more than 600 direct jobs in Queensland alone, with even more through the supply chain.
To maximise collaboration.
Look at the Sensor & Trials Facility on RAAF Edinburgh where defence scientists and industry are working on the Salus project.
This is demonstrating rapid and accurate, real-time track fusion of an airborne threat in a multi-target environment.
To keep Australia safe.
Look at Adelaide’s QuantX Labs.
After 20 years of research their Cryoclock is revolutionising precise time-keeping to boost operations at the Jindalee Operational Radar Network ...
This is Australia's first comprehensive land and air early warning system.
SOVEREIGN DEFENCE INDUSTRIAL PRIORITIES
The crucial seven Sovereign Defence Industrial Priorities (SDIPs) you are exploring today will steer Australian business and industry to where the urgency is.
To those things we must be able to do in Australia to build, sustain and enhance defence capability.
It is important industry has visibility of them.
And now it’s time to build a deeper understanding.
And you will see today how sustainment is at the core of the SDIPs.
If our impressive hardware is not being maintained to world class standards, or enhanced for longevity it impacts both capability and safety.
Our commitment to extending the life of Australia’s six Collins class submarines demonstrates this priority.
Keeping these submarines in service, without compromising on submariner safety during the transition to nuclear-powered submarines.
And it’s why we have allocated more than $90 billion to sustainment across Defence over the forward estimates in the most recent portfolio budget statement.
The SDIPs give industry both the time to prepare, and the confidence to invest, to deliver what Defence needs.
With a focus on value for money and speed to acquisition.
The detailed SDIPs will continue to be reviewed and refined as the industrial base develops, in close consultation with industry.
And we will intervene in the design and delivery of the Integrated Investment Program to sustain them.
Importantly there is now strong support from capability managers who are deeply embedded in the process
to ensure proven technologies are funded and accelerated to market.
The strategic partnerships we build around these SDIPs will provide greater certainty to industry.
Anchored by new programs and improved processes.
ADVANCED STRATEGIC CAPABILITIES ACCELERATOR (ASCA)
Just over a year old, the Advanced Strategic Capabilities Accelerator (ASCA) is the most significant reshaping of defence innovation in decades.
With backing of $3.6 to $3.8 billion dollars over the coming decade, it will deliver vital capabilities to Defence and bring industry partners at speed to the problem-solving table.
Just look at the partnership to deliver an autonomous undersea capability through the Ghost Shark program.
This is a program that delivered the first prototype one year early and on budget.
Once all three prototypes are delivered next year the project will have gone from conception to full realisation in less than three years.
ASCA is our best guarantee of Australia remaining at the cutting edge of military technology and asymmetric military developments.
DEFENCE INDUSTRY DEVELOPMENT GRANTS
Industry can only work fast if unnecessary road blocks are removed.
The Government has heard your feedback. The last thing I want to do is waste the time of businesses – big or small.
We committed to a new Defence Industry Development Grant Program to provide better tailored support to Australian businesses in the areas of our industrial priorities.
And we have delivered on this commitment, with applications for our new single, streamlined grants program now open.
Offering more than $150 million over four years, this new program is easier for business to navigate whilst supporting Australian SMEs to leap frog to the innovation front line.
Eligible Australian businesses can apply through a single portal to any of the four streams – sovereign Defence industrial priorities, export opportunities, technical skills and security uplift.
REFORMING PROCUREMENT
Reform is underway on procurement, including improving Defence’s application of the Australian Standard for Defence Contracting framework – known as ASDEFCON.
The progressive reforms to the ASDEFCON suite will make it easier, faster and more cost effective for industry to work with Defence.
And we will establish more strategic partnerships with industry, including to combine related acquisition and sustainment activities where it makes sense.
So that we can offer more certainty and create economies of scale.
Businesses can expect better guidance on how to use templates, along with improved training.
We won’t compromise on governance, but we will reduce the time it takes to receive project and contract approvals to deliver capability at speed.
GLOBAL SUPPLY CHAIN PROGRAM
We have delivered on our commitment to expand the Global Supply Chain Program.
Last month, I announced the Albanese Government had almost doubled the number of defence industry primes participating in the Program from seven to 13.
This significant expansion builds on the strong legacy of the former Labor government which established the Program – a Program that, since inception, has delivered 2,450 contracts worth over $1.9 billion to 258 Australian suppliers.
Just like the former Labor government, the Albanese Government is standing up for Australian defence industry – supporting them to export Australian ingenuity around the world and creating more high skill well paid jobs.
It’s why we are also unlocking barriers to working with our closest partners.
This year the Government has passed two landmark pieces of legislation that protect our cutting-edge military technologies and ensure our military secrets remain in Australian hands.
The Defence Trade Controls Amendment Act strengthens our national security and will fast track the delivery of high-end capabilities to the ADF, unlocking license requirements for an estimated $5 billion in annual defence exports.
And the Safeguarding Australia’s Military Secrets Act enhances the government’s ability to prevent the unwanted transfer of sensitive defence information to foreign militaries protecting our military knowledge, skills and experience.
These two vital pieces of legislation support our local industry by unlocking defence trade, innovation and collaboration opportunities and removing red tape between Australia and our AUKUS partners.
AUKUS PILLAR 1
This will include the confidence to grow Australian technical services and skills through the AUKUS conventionally-armed nuclear-powered submarine program.
This nation-building endeavour will create around 20,000 direct jobs over the next 30 years across industry, the ADF and government.
We continue to move closer to realising this generational undertaking unprecedented in terms of both scale and technical complexity.
We recently announced that ASC Pty Ltd and BAE Systems will build Australia’s SSN-AUKUS submarines.
We’ve announced that ASC Pty Ltd will be our sustainment partner, starting with Virginia class submarines, followed by the SSN-AUKUS.
Work continues with our AUKUS partners to implement efficient vendor and product qualification processes for Australian industry.
We farewelled the first cohort of ASC skilled submarine workers from South Australia and Western Australia for the Pearl Harbor Naval Shipyard in June.
Training in the maintenance of US Virginia class submarines alongside their US counterparts a once-in-a-lifetime opportunity.
And work towards SSN-AUKUS has already begun.
All AUKUS partners are investing significantly in our respective industrial bases.
Ensuring we build collective resilience and capacity to produce and sustain nuclear-powered submarines for the decades to come.
As part of AUKUS Pillar Two, the first Innovation Challenge series is underway with ASCA running the Australian arm.
Each challenge is drawn from a trilaterally agreed problem set.
With governments, industry, and academia trying to solve some of the really complex defence challenges we are yet to have technical answers for.
Australia, the UK and the US are committed to working closely with industry.
The trilateral AUKUS Advanced Capabilities Industry Forum has met in person twice this year, with a third meeting later this year.
GUIDED WEAPONS AND EXPLOSIVE ORDNANCE
The war in Ukraine has highlighted how vital the supply of munitions is to modern armed forces and the fragility of supply chains for global weapons.
The Guided Weapons and Explosive Ordnance Enterprise – better known as ‘GWEO’ – is the answer.
Its first priority is to rapidly establish the domestic manufacturing of guided weapons, starting with the assembly of imported components.
And progressing to local manufacturing of selected components.
Close collaboration with our international partners, including the US, is critical to building the industrial base.
Building on the joint commitment between Australia and the US at last year’s AUSMIN consultations.
2025 will see Lockheed Martin beginning to assemble Guided Multiple Launch Rocket System missiles in Australia…
An important first step toward establishing domestic missile manufacturing on a large scale.
Over time, as domestic capability and capacity grows, the focus will shift to the manufacture of higher-complexity weapons and components.
And we are uplifting the industrial base right now to be ready – as shown by the Government’s $220 million investment in the munitions factories at Mulwala and Benalla.
We’ll have more to say on the Government’s plan for guided weapons and explosive ordnance in the upcoming GWEO Enterprise Plan.
INVESTING IN PEOPLE
Successful development of the industrial base depends on capability and capacity uplift of the workforce.
Defence is developing a Capability Delivery Academy for the whole-of-Defence delivery ecosystem, including industry partners.
The Academy will offer opportunities for industry secondments within the Defence Science and Technology Group and ASCA.
The Defence Digital Engineering Strategy has been released and extensive consultation will soon commence with industry.
An industry workforce outlook is being developed as we speak, using the Naval Shipbuilding and Sustainment domain as a pilot.
Planning and initial consultation across the Commonwealth, Industry, States and Territories, and the education sector is underway.
It will give us the best coordinated picture to date of where the gaps and opportunities lie.
We are rebuilding Defence’s Industrial Intelligence Capability so it can be a smarter customer and this capability will be in place by December this year.
The Defence Industry Development Strategy relies on knowing where the gaps are and where to reposition resources and support and we are sensibly looking to the next generation of defence industry specialists.
WORKING WITH DEFENCE
Landing the Defence Industry Development Strategy depends in large part on open and regular communications between Defence and industry, including events like today’s.
Talking to all tiers of industry including SME’s and Defence primes, state based defence advocates and defence industry associations throughout Australia.
To date, since the launch of the NDS and IIP, we have held over 15 major Defence-led industry engagements to provide more detail to industry on the IIP. This includes the recent Maritime Domain Industry Forum and Land Domain Industry Forum. We have also offered additional private briefings to select industry partners where necessary.
And we’ve got many more events scheduled this year including Domain Industry Forums and Land Forces 2024.
The Office of Defence Industry Support (ODIS) will run forums too and will continue to be the primary Defence point of contact for industry.
These activities are about bringing industry into the fold to work together in addressing our industrial capability gaps and keep Australians safe.
These are significant undertakings that cannot be achieved without the tripartite partnership of the Government, industry and unions.
Less than two weeks ago in Perth, the Deputy Prime Minister and I convened the inaugural Maritime Workforce and Skills Council with industry primes and unions in the shipbuilding and sustainment industrial enterprise.
And soon I will chair the first tripartite defence industry council.
Membership includes my colleague Ed Husic, the Minister for Industry and Science, unions and defence industry.
Minister Husic and I will work closely together to build and deliver the capability and capacity we need to advance Australia’s sovereign interests, protect our way of life, and provide thousands of jobs and opportunities for industry and business.
Can I conclude by acknowledging that your participation in today’s summit is a valuable contribution to our efforts to break down barriers in the defence industrial base.
I greatly appreciate your interest in our seven SDIPs and the opportunities ahead.
I look forward to hearing the insights and outcomes of today’s summit.
They will be incredibly useful in informing the ongoing implementation of the Defence Industry Development Strategy.
Thank you.
[ENDS]