Opening statement: Senate Inquiry into Australia’s sovereign naval shipbuilding capability

Ms Kate Louis
Head of Defence and National Security
Australian Industry Group

Ai Group Opening statement to the Senate Economics References Committee inquiry into Australia’s sovereign naval shipbuilding capability

Thank you for the opportunity to make an opening statement to the Committee.

The Federal Government’s decision to acquire nuclear submarines as part of the new AUKUS trilateral relationship between the United States, the United Kingdom and Australia has profound industrial and geo-political implications for Australia.

This is one of the most consequential defence capability decisions ever taken by an Australian government.  It has undoubtedly been driven by the Government’s assessment of our regional conditions and will have implications for our political and economic relationships.

The decision will also have a significant impact on the industrial base that was being developed to support the Attack class submarines.

At this early stage there are many questions about the new project that need to be worked through, including achieving an equitable outcome for any existing commercial agreements.  This will include businesses and individuals that have invested for their role in the previous submarine plan and how to assist them going forward.

Industry is naturally concerned about the investments that have been made in order to be considered for the program and uncertainty about the future.

In this regard we acknowledge the establishment of the Impacted SME Support Cell within Defence. It will be important going forward that Defence now brings strong collaboration and cooperation with industry to build on the capabilities that many Australian companies have developed and built to support the Attack class project.

Any decision to simply import submarines from either the US or UK without Australian industrial input would be a setback for developing our domestic capacity and capability.  A key metric for success of the new submarine program, and indeed Defence acquisition more broadly, will be the technology transfer into the country.

There are also issues to work through on how Australian capability is developed and embedded in areas such as cyber capabilities, artificial intelligence, quantum technologies, and additional undersea capabilities.

 

The decision to acquire nuclear-powered submarines marks the beginning of a new era in Australian Defence Force capability. It must be underpinned by:

• Leadership and communication of Australian requirements at the Government-to-Government level, including our industrial requirements;
• A clear and transparent industrial strategy that includes driving industry as a fundamental input to capability from the outset;
• Long term investment and resourcing to assist Australian industry understand the standards of nuclear submarine construction and the qualification process; and
• Strong partnering arrangements to introduce local industry into the industrial ecosystem – which might include assisting them in partnering and licensing technology from overseas partners.

Thank you again for this opportunity and I look forward to the discussion.

Ms Kate Louis
Head of Defence and National Security
Australian Industry Group

 

Media enquiries

Tony Melville – 0419 190 347