Sarah Ferguson, 7.30, ABC

SUBJECTS: AUKUS

SARAH FERGUSON, HOST: Deputy Prime Minister Richard Marles was one of the Labor ministers singled out for criticism by Paul Keating today. As Defence Minister, he has direct responsibility for the nuclear submarine program. Richard Marles joins me now live from Perth. Richard Marles, welcome to the program.

RICHARD MARLES, DEPUTY PRIME MINISTER: Good evening, Sarah.

FERGUSON: Let's start with your response to Paul Keating's accusation that you and Penny Wong influenced the Prime Minister to make the worst international decision by a Labor government in 100 years?

MARLES: Well, whatever Paul Keating says about myself, the Foreign Minister, the Prime Minister, you won't hear a bad word from us about him. I mean, the Hawke-Keating Government was the great peacetime reformist, long-term government in our history. It's a government that finished in 1996. And our responsibility is to be governing the country in the national interest in 2023. And I’d want to make the point, Sarah, that we inherited, when we came to office, a set of international relations which were in large measure broken. Penny Wong has been responsible for repairing them. Penny Wong has done more in respect of putting an emphasis on our relations with the Pacific than any foreign minister. Within a year she really is one of the greatest foreign ministers we've had. And I don't think we've seen a Prime Minister walk the international stage so comfortably and so easily, so quickly, as Anthony Albanese. He is actually the person who stabilised our relations with China. But he understands the importance of getting the hard power equation right. That's what we're doing here. For my part, it's really the honour of my professional life to be serving with both of them.

FERGUSON: Nonetheless, the former PM's scathing attack on his Labor colleagues, on the intelligence community, on the military, is unprecedented. He's calling your competence into question and saying essentially, you have put the country in peril. Has he in any way shaken your confidence that you’ve done the right thing?

MARLES: Not at all. I mean, our national security today, and our strategic interests, lie in the global rules-based order. One of the great achievements of the Hawke-Keating Government was to open our economy up and see us become much more connected with the world. And that's been to the great benefit of our economy and the prosperity of the Australian people. But what it means in a practical sense is that today, you know– in 2020, 45% of our GDP was based on trade. Back in 1990 it was 32%. The practical implication of that, Sarah, is that in the 1990s we had eight refineries which were producing the majority of the liquid fuels for our country. Today we have just two. We import the vast majority our liquid fuels from overseas. In fact, most of them come from one country, in Singapore. You don't have to think very hard –

FERGUSON: There’s no. Yes, there’s no question –

MARLES: Can I just finish that point?

FERGUSON: Yes, please, go ahead.

MARLES: You don’t have to think very hard about what it would mean for that one trade line, that one trade route, to be disrupted. It is wrong to be thinking in terms of our vital national interests being confined simply to the continent. Our interest lies in the rules of the road, our connection to the world, and the collective security of our region, and that’s what this capability will help provide. 

FERGUSON: Paul Keating's argument is based on the assertion that China does not pose a threat to Australia. Has your Government decided the opposite?

MARLES: Well no. We’ve sought to stabilise our relationship with China and we’ve worked hard at that. We want to have a productive relationship with China. But we do observe that we are seeing the biggest conventional military build-up in the world today, since the end of the Second World War. In the year 2000, China had six nuclear-powered submarines, by the end of this decade they're expected to have 21. In the year 2000, China had 57 major surface vessels, by the end of this decade they will have 200. What we’re doing, is over the next 30 years, replacing our six conventional submarines with eight nuclear-powered submarines. That's what we're doing.

FERGUSON: Let me ask you a question about that. Does the Government intend to commit to using this new submarine fleet only in defence of Australia? Or could they be used in an offensive way as part of a larger US fleet operation?

MARLES: Well, firstly, there's been a whole lot of commentary about the sovereignty of these submarines. Let me be really clear. The moment there is an –

FERGUSON: I think that wasn’t a question directly about sovereignty. It’s about defence versus an offensive operation. Part of a larger fleet operation run by the US.

MARLES: Yes, but as soon as you start talking about operations run by the US, it raises the question of our sovereignty and our decision making in respect of our assets. I want to be clear about this: the moment these submarines have an Australian flag upon them, is the moment that they are completely commanded by Australia and what they do is determined by us.

FERGUSON: And do you commit that they are for the defence of Australia rather than to take part in offensive operations in the Indo-Pacific?

MARLES: The strategic intent of these submarines is absolutely about the defence of Australia. And we have engaged in a massive diplomatic effort over the last few months and particularly over the last week where between the Foreign Minister, myself, the Prime Minister, the Minister for the Pacific, we have made more than 60 calls to within our region – ASEAN, the Pacific, regional leaders – to make clear what our strategic intent is. And that is to provide for the collective security of our region, and the underpinning of the rules-based order, because that's where our interests lie. Sarah, the defence of Australia doesn't really mean that much today, in the context of the way in which we are connected to the world, unless we are seeing the collective security of our region and the maintenance of the global rules-based order. And that is a very different circumstance to the 1990s. And this capability is the most important capability that we will have, in terms of making our contribution to that regional security, and to underpinning that order.

FERGUSON: Well, there could be indeed be many flash points for conflict if strategic competition worsens. Obviously, particularly in Taiwan. Now, I just want to put this to you, the Admiral of the US Navy told the US Congress last year, that the US will require a robust force presence in Australia – along with Japan, Guam and the Philippines – to, and I quote “effectively defend Taiwan against attack by mainland China”. This is last year. That sounds like we are part of their plan, to defend their interests.

MARLES: Well, firstly, what we're doing in terms of the acquisition of these submarines is around the collective security of the region, maintenance of the global rules-based order in the way in which I have described. Scenarios around Taiwan are really quite separate to this. In respect of Taiwan, we've made it clear that we don't want to see any alteration to the status quo across the Taiwan Strait. And that what really matters here, in line with what I’ve just said, is that the rules of the road as they apply to the region, also apply to the region around Taiwan. That’s where our interest lies. But in terms of any future scenario in respect of Taiwan, I mean that obviously has to be assessed at the time. And that's really a separate issue to what we're deciding today and what we decided yesterday, which is about giving our country the capability to be much more self-reliant going into the future, and giving our country an ability to maintain our safety for decades to come.

FERGUSON: Let's go back to AUKUS itself. Keating is saying that AUKUS puts future budgets in peril – Mr Keating, I should say. That $300b for eight subs is preposterous, as he put it. Now, some of the money is paid to the US and the UK. How do we know that Australia is going to get value that colossal sum?

MARLES: Well firstly, you can you take any ability of government, extrapolate it through to the middle of the 2050s –

FERGUSON: Sure. But the number is large. Nonetheless, the number is large.

MARLES: But these numbers that people are quoting go through to the 2050s, are over 30 years. And as I say, you can take a range of activities of government well beyond Defence and you will get similarly large numbers if you look at them over that period of time. The meaningful number which describes the cost of this capability is about 0.15% of GDP –

FERGUSON: This is not a question about cost, this is a question about value, to be precise.

MARLES: Sure, and if we're going to describe the value for money, we need to understand the cost associated with it. We're talking about a cost of 0.15% of GDP over the life of the program, against a Defence Budget right now which is at 2% of GDP – much less than Britain, much less proportionally than the United States – which will grow to 2.2%. Now, when you think about it in those terms, and you look at the degree to which this gives Australia a transformational leap in terms of our ability to project, in terms of the potency of our Defence Force, this is the most value for money spend within the Defence Budget that we will make.

FERGUSON: Australia could end up in a position where it's supporting three different submarines at the same time; the Collins class, the US Virginia, and the new AUKUS boat. I’ll ask you to answer this briefly. How is it possible for a new industry, a relatively new industry, to sustain this?

MARLES: Well, we've got time. I mean, the circumstance which may or may not occur, which you’ve described, would be in the early 2040s. But you are right that we will at least be running two sorts of submarines. Look, that is a function of, to be honest, the lost decade that we've had during the former Coalition Government, which has given rise to the prospect of a capability gap in the 2030s. And the way in which we – and the only way in which we're able to deal with that capability gap so we have an evolving submarine capability, is by acquiring these Virginias early. Now we believe that in the way in which we have structured the future submarine that will be built in Australia and in the United Kingdom, with more American technology on it, there will in fact be quite a lot of commonality between the two platforms, so we think we can make this work and it is manageable. But it is a function of the capability gap that was left to us.

FERGUSON: Let’s come back to Mr Keating. Is there now an irretrievable breach between this Labor Government and the Party’s ranking elder? Is there any coming back from this?

MARLES: Look, as I said earlier, whatever Paul Keating says about us, we will not be saying a bad word about Paul Keating. I mean, the Hawke-Keating Government is one of the great governments of our history. And Paul Keating's legacy in that is completely assured and he's a revered figure in our movement. And it’s really important that he remains as such. But, I repeat that that –

FERGUSON: Would you still take a phone call? Would you still take a phone call from Mr Keating?

MARLES: Of course. And I’ve had really positive engagement with Paul Keating over a long period of time. But I reiterate that the Hawke-Keating Government finished in 1996. Our responsibility is to manage our national interest, faced with the national security challenges that we have in 2023, and based on the classified and confidential briefings that we get today. And they’re the circumstances that we have to manage. That's the mandate that we have received. And that’s the mandate that we will fulfil.

FERGUSON: Richard Marles, thank you very much indeed for joining us.

MARLES: Thanks Sarah.

ENDS