Interview with David Speers, ABC, Insiders

DAVID SPEERS, HOST: Richard Marles, thanks for joining us this morning.

RICHARD MARLES, DEPUTY PRIME MINISTER: Morning, David. How are you?

SPEERS: Let's start with this basic question; why does Australia need nuclear submarines as opposed to more conventional, conventionally-powered submarines?

MARLES: Well, David, the starting point of that question is why we need submarines? And a cursory glance at our geography, where we are, that we are an island trading nation located a long way from the places that we export our product to, means that we are really dependent upon those trading routes. And once you think that we are a country which needs to have a submarine capability, what becomes clear, not so much in 2023, but as we project through the 2030s and into the 2040s, is that the only capable long range submarine that will be able to effectively operate is a nuclear-powered submarine. And the reason for that is because diesel-electric submarines are able to be on target for a time frame measured in days before they then have to go to the surface, recharge their batteries by using their diesel engines- that's a noisy thing to do- it's called snorting. The ability to be able to detect that is growing. It means that, if you like, the question mark that a submarine represents in an adversary's mind becomes much smaller. Whereas nuclear powered submarines are able to be underwater for months at a time. I mean, their only limitation is really the food for the crew. And that is therefore what we're going to need to have in the future. And that's why we have to walk down this path, which is ultimately converting our six current diesel-electric submarines to eight nuclear-powered submarines over the course of 30 years.

SPEERS: But we have always been an island. We've always been a trading nation. We've always relied on those sea lanes. How is the threat changed here? Can you be upfront with people about why we suddenly need this greater capability to defend those sea lanes, as you say?

MARLES: Well, firstly, nothing sudden. I mean, this has been a debate that's been going on for a while. And as you've been talking about during the course of the morning, we're talking about acquiring this capability- the first in ten years’ time and building up the eight over 30 years. So nothing sudden. But there is a change in the nature of us and this is the point that we need to think about. As I've been listening to you talk this morning. I mean, one of the achievements of the Hawke-Keating government was to open up our economy and make us much more connected with the world. In 1990, trade as a proportion of our GDP was 32 per cent. By 2020, it's 45 per cent. That's a dramatic difference. And when you break that down and look at specifics, in the 1990s, we had eight oil refineries which were producing most of our liquid fuels on shore. Today, we have two. And most of our liquid fuels we import, indeed, most of what we use, we import from one country, and that's Singapore. So one trading route right there.-

SPEERS: So who's threatening that trading route with our economy?

MARLES: And right there- if I can just finish; right there, displays a vulnerability that we need to protect.

SPEERS: So who's threatening that sea lane?

MARLES: Well, we have seen the global rules based order be placed under threat, obviously, in Eastern Europe, but we see it placed under threat in the Indo-Pacific as well, in the South China Sea–

SPEERS: By who?

MARLES: Well, China is seeking to shape the world around it in a way that we've not seen it do prior to the last decade. And I don't say this with judgement, I think China is a great power doing what great powers do. But within the South China Sea, we've seen the creation of artificial islands. There is an idea of asserting a sovereignty which is not consistent with how we understand the UN Convention on the Law of the Sea, which provides for freedom of navigation, freedom of overflight. I mean, that body of water right there is a body of water through which most of our trade goes–  

SPEERS: So is China a threat? Is China a threat to our sea level?

MARLES: Again, if I can just finish that point, a lot of that trade goes to China, but all of our trade to Japan, all of our trade to South Korea, two of our top five trading partners goes through the South China Sea. Now, the only point to make here is that the maintenance of the rules based order, as we understand it- freedom of navigation, freedom of overflight- is completely in Australia's interest. And we need to make sure that we have a capability which can back up that interest. And that's why we have to walk down the path that we are.

SPEERS: Okay. I just want to be clear on this, because you're asking a lot of Australian taxpayers through this plan. Is China a threat to our sea lanes?

MARLES: Well, as I've described, there is an assertion of sovereignty in respect of the South China Sea, which is not consistent with the UN Convention on the Law of the Sea. And international courts have made that point. So we observe that. We observe the fact that–

SPEERS: So that’s a yes, is it?

MARLES: If I can finish. We observe the fact that in the year 2000, china had six nuclear-powered submarines. By the end of this decade, they'll have 21. In the year 2000, they had 57 surface ships. By the end of this decade, they'll have 200. Now, this is a very big military build up.

SPEERS: Sounds like an arms race.

MARLES: And it shapes the strategic landscape in which we live. Now, in saying all of that, we want the best relationship with China that we can have, and we're working very hard to stabilise that relationship. And we value a productive relationship with China. And that is all very much the case. And the front line of our engagement with the world is our diplomacy and we seek to pursue a much better relationship with China. But those hard power equation facts exist, and we need to be thinking about that when we're determining our own hard power equation.

SPEERS: You've talked about using these submarines to protect our sea lanes. Will Australia's nuclear submarines also be used to defend Taiwan?

MARLES: Well, again, I've listened to the debate that you've had this morning. It really is a completely separate question.

SPEERS: What's the answer to it?

MARLES: I'm not going to speculate about the future of Taiwan is the first answer. But what Australia would do or not do in respect of any future conflict will be a matter to be considered at that time by the government of the day. I mean, that is the obvious statement to make and it's the truth. This is not about that. Yes, nuclear-powered submarines have obviously the capacity to operate in the context of war, but the primary intent here is to make our contribution to the stability of the region, to the collective security of the region. Precisely because when you think about how Australia operates today and the way in which we are connected with the world, and particularly with South East Asia and East Asia, the defence of Australia doesn't really mean much unless there is the collective security of our region and the maintenance of the rules based order. And so we need to be understanding that's where our national interest lies. That's what we need to underpin through the shape of our defence force and the capabilities that we operate, and that's what we're doing.

SPEERS: Okay, but just on this point, in return for access to these Virginia class subs, has Australia given the United States any sort of commitment explicitly, implicitly, that we will be there in the event of a conflict over Taiwan?

MARLES: The answer to that is of course not. Of course not- and nor was one sort. And I've listened to that conjecture from a number of commentators. It is just plain wrong.

SPEERS: So no quid pro quo here over access to these Virginia class subs?

MARLES: Absolutely not. And I couldn't be more unequivocal than that. And more than that. David in the lead up to this announcement, I made a speech to Parliament which outlined questions of sovereignty, not just in relation to, obviously, the capabilities that we have within our defence force, but also in respect of the use of our continent, which made it clear that in all that we do, we maintain complete sovereignty for Australia. And I want to make it really clear that the moment that there is a flag on the first of those Virginia class submarines in the early 2030s, is the moment that that submarine will be under the complete control of the Australian government of the day. And again, no one would have expected that to be any different. I mean, that is obviously the basis upon which this is happening.

SPEERS: In the meantime – that's ten years away, in the meantime, we'll have visiting US and British nuclear-powered submarines in Australia on extended rotations. Now, will Australians be serving on those on board, learning the ropes? Is that the plan?

MARLES: Exactly, and that's why we're doing that. So, to be clear, I mean, there are Australians operating on Astutes and Virginias now–

SPEERS: But for these–

MARLES: and actually have been for some time.

SPEERS: Okay. For these ones, though, if they are, in the coming years, in the coming decade, if that submarine is then sent into any sort of conflict, perhaps Taiwan, those Australians on board will be joining that?

MARLES: Again, in terms of Australians engagement in any conflict, that is a separate question and that would be determined at the time by the government of the day if there was any conflict–

SPEERS: But wouldn’t they be under the command of the American commanding that American submarine?

MARLES: Yeah, but we get into conjecture and speculation here, which I'm loath to do. So, without referring to any specific conflict, if there was a point in time in the future where there was a conflict in the world, where there was the prospect of a submarine– of one of these submarines with Australians on board entering it, that is obviously going to be a matter for the government at the time. What we are–

SPEERS: So you could call them back, the Australians?

MARLES: Well, it's not a matter of could. What Australians do in respect of any conflict is always a matter for an Australian government of the day to control, and this doesn't remove any one ounce of that control. That would absolutely be the case going forward.

SPEERS: But doesn't this get to the issue around the Virginia class subs which will have Americans on board Australian flag vessels, who's telling them what to do?

MARLES: Well, I'm not sure why you presume that, David. These will be–

SPEERS: You can clear that up for us. They won't have Americans on board these Australian flag Virginia class subs?

MARLES: The submarines that we operate will be operated by Australians and be capable of being entirely operated by Australians. So let's be clear about that. Right now we have Australians on board Virginias. Right now we have Australians on board Astutes. And we have had Australians having the opportunity to operate on nuclear powered-submarines of both the UK and the US for over many years. It's possible, given that there is that arrangement, that you might have Americans on board, but the command and the control of that submarine in the future will be done by Australians.

To go back to your earlier question, that the point of the rotation, which is exactly right. And indeed, the point of the increased tempo of visits from this day through until 2027, is precisely so that we can give our submariners an opportunity to have experiences on this platform. And then from 2027 onwards, in a much more structured way, to actually grow the submariner cohort that we will need to operate our submarines.

SPEERS: Just on the cost, it's a huge figure, up to $368 billion. But that lumps in everything, right, over the next 30 years? Can you just give us a bit of a more understandable breakdown? What is the Virginia class submarine going to cost each, versus the AUKUS submarine that will come down the track?

MARLES: Yeah, look, you can cut these numbers in a whole lot of ways, obviously. The reason we’ve put these numbers out in the way that we have is because we see this as being the most open and transparent way in which we do that.

SPEERS: But you know these numbers though? You must know these numbers, Minister?

MARLES: The reason we have done it in the way we have is to give a complete cost of the capability–

SPEERS: What I'm asking is the cost of the Virginia class submarine and the cost of the AUKUS submarine. You know these figures, don't you?

MARLES: I know the figures, but in a sense they become–

SPEERS: What are they?

MARLES: Because they become a bit arbitrary as to what you include as part of the submarine and what you include as part of the onshore component –

SPEERS: Let's just go with the submarine.

MARLES: Which is why, what we've ultimately done, David, is provided the all up cost so that you get the whole thing. I mean, historically –

SPEERS: But you can tell taxpayers what they're getting here. What does the submarine cost?

MARLES: David, again, if I can finish. That is why we're telling taxpayers exactly what they're getting and exactly what the cost is. The whole thing. Historically, what governments have done is supply an acquisition cost, like the purchase of a car without ever talking about how much it costs to run that car. But given the nature of this capability, and so much of the cost comes in the running of it, what we've done is given all of it. So over Forward Estimates–

SPEERS: I don't know why you can't give the price of the submarine, though?

MARLES: We're giving the price of the submarine plus the cost of operating it, because that's the honest answer to the question–  

SPEERS: So what is the price of the submarine?

MARLES: And the answer to that question is it's $9 billion for the capability over the Forwards. It's between $50 to $58 billion over the course of the decade. And having–

SPEERS: And the price of the submarine having.

MARLES: Having this capability over the course of its life is 0.15% of GDP. Now, that's against a backdrop of a Defence Budget which is at 2% of GDP, growing to 2.2%. So this is less than 10% of the defence spend. And for that we get the most transformational capability of our Defence Force, a dramatic increase in our potency. This is easily, in the context of defence spends, the best value money of 0.15% that we'll spend.

SPEERS: And a final one, the nuclear waste here. We've already got some of the states squabbling over where it should go. You've got a bit of time to work this out, I suppose. Can I ask, are you in breach of the ALP Party National Platform when it comes to disposing of this nuclear waste eventually in Australia?

MARLES: No. Everything that we're doing is consistent with the ALP Platform. Look, this is a big commitment that we've made. It forms part of being the responsible nuclear steward that we need to become, not just in terms of the disposal of the waste, but the handling of the nuclear material right through the life of it. And it is a heavy responsibility to become that nuclear steward. But a part of that is to be responsible for its ultimate disposal. It is going to require a purpose built facility. As you said, the first reactor will be disposed of in the mid-2050s. So we have got time to get this right.

Speaker C: You've got the day to day waste, though, that you'll have to deal with that in ten years though, won't you? The operational waste, as it's called in your documents.

MARLES: Well, that is very low level waste, which is–

SPEERS: Where will that go?

MARLES: We're talking about cloths that have been used to scrub things down. So that's the kind of waste we're talking about in respect of that. But the key issue is going to be the nuclear reactors. And we do have time to get this right. We’ve said that next year we’ll have a process–

SPEERS: Because the Party Platform, your ALP Party Platform, it says Labor will prohibit the establishment of nuclear power plants and all other stages of the nuclear fuel cycle. It also says you remain strongly opposed– the platform says you remain strongly opposed to the importation and storage of nuclear waste that is sourced from overseas in Australia.

MARLES: Yeah, I think both of those statements go to different questions that have arisen over the years. We're not talking about establishing a civil nuclear industry, nor are we talking about opening Australia up as a repository for nuclear waste from other countries. What we're talking about here is being responsible nuclear stewards for the nuclear material that we are using for the specific purpose of naval propulsion. And it's important that as a nuclear steward, we do that. As I say, we've got time to get this right and we will.

SPEERS: All right. Defence Minister and Deputy Prime Minister, Richard Marles. Thank you.

MARLES: Thanks, David.

ENDS