Ministerial Statement

Offshore Patrol Vessels

The Hon. M.L.J. HAMILTON-SMITH (Waite—Minister for Investment and Trade, Minister for Small Business, Minister for Defence Industries, Minister for Veterans' Affairs) (14:03): Thank you, Mr Speaker, I do not know what came over me. I seek leave to make a ministerial statement.

Leave granted.

The Hon. M.L.J. HAMILTON-SMITH: The future of Australia's naval shipbuilding industry and the many jobs that depend upon it are in the hands of the federal government. We need the federal government to commit to a continuous build of surface ships and submarines, and this begins with the offshore patrol vessels in South Australia. Last night the Defence Minister, Marise Payne, told a Senate Estimates Committee that the evaluation process for the offshore patrol vessels did not require them to be built here in Adelaide.

This is a significant departure from the commonwealth's previous assurances that jobs in South Australia have been secured. Former prime minister Tony Abbott announced in August 2015 that major shipbuilding projects would be brought forward. That work would start in 2018 and would be 'centred on South Australia'. I remember that the Leader of the Opposition flew up for a cup of tea and a biscuit with the minister the day after her appointment and assured the house and South Australians that he would fix it all. Following this announcement, senior—

Members interjecting:

The Hon. M.L.J. HAMILTON-SMITH: Here they go.

Members interjecting:

The Hon. M.L.J. HAMILTON-SMITH: Oh, how unsavoury, Mr Speaker. How unsavoury of them. Following this announcement—

Members interjecting:

The Hon. M.L.J. HAMILTON-SMITH: I think they're HMAS failures! Following this announcement—

Members interjecting:

The Hon. M.L.J. HAMILTON-SMITH: And they get launched daily, sir—launched and commissioned daily as HMAS failures. Following this announcement, senior cabinet minister Simon Birmingham said:

Around $40 billion of investment on Future Frigates, Offshore Patrol Vessels and other surface ships will provide a steady stream of work for shipbuilders in Adelaide.

The commitment was welcomed by local industry. It was taken at face value by workers and by this government. That commitment evaporated last night. Building the offshore patrol vessels (OPVs) and Future Frigates in the same precinct is vital. Delivering these projects from different shipyards will compromise the success of the Future Frigates project and lead to cost premiums associated with starting up the shipyard from scratch.

In late 2014 the commonwealth government commissioned a report on naval shipbuilding prepared by the RAND Corporation. It identified the offshore patrol vessels as the most promising and cost-effective transition from the current air warfare destroyer project to the Future Frigates. The skills capability and infrastructure needed for the construction of frigates, submarines and OPVs already exists here in South Australia. South Australia has the infrastructure—

Mr van Holst Pellekaan interjecting:

The Hon. M.L.J. HAMILTON-SMITH: Well, convince your federal colleagues to make a decision then, shadow minister. South Australia has the infrastructure, the skilled workforce and the experience to build new ships.

Members interjecting:

The SPEAKER: Minister. The minister has been granted leave. He shall be heard in silence. If one no longer wishes to hear the minister the remedy is simple, and the minister will not respond to interjections.

The Hon. M.L.J. HAMILTON-SMITH: Thank you, sir. The South Australian government has lobbied the commonwealth Prime Minister and defence ministers (former and current) at length, and we have supported a nationwide advocacy campaign. I have visited all three submarine proponents and spoken at numerous national meetings on this issue.

This week the Premier and I met with Mr Shunichi Miyanaga, President and CEO of Mitsubishi Heavy Industries. We met with Dr Hans Christoph Atzpodien, Chairman of the Supervisory Board and Dr John White, Chairman of TKMS. This afternoon we met with Sean Costello and Ms Marie-Pierre de Bailliencourt of DCNS.

Mr Marshall interjecting:

The Hon. M.L.J. HAMILTON-SMITH: Have you got something intelligent to say, leader? It would be the first time this year. The South Australian government will fight to the end for this work to be committed to Australian industry and to Australian workers based in Adelaide, and we would like to see those opposite join us.