Submarine Contract

The Hon. F. PANGALLO (14:49): I seek leave to make a brief explanation before asking the Treasurer a question about job security.

Leave granted.

The Hon. F. PANGALLO: Thank you, Mr President.

The Hon. C.M. Scriven: You've got another five years.

The PRESIDENT: Order!

The Hon. F. PANGALLO: A Senate estimates hearing in Canberra this morning has been told up to 600 highly skilled South Australian jobs are in doubt as construction on the new Osborne submarine shipyard comes to a halt as a result of the AUKUS announcement. Australian Naval Infrastructure boss, Andrew Seaton, told the hearing that between 550 and 600 people were working on building the shipyard, which was to have been used at the base to build the 12 Attack class submarines.

That work stopped last month when the federal government announced a new fleet of eight nuclear powered submarines under the AUKUS alliance would be acquired to replace the scrapped $90 billion Attack class contract with Naval. Asked at the estimates hearing if the AUKUS announcement placed uncertainty around up to 600 jobs, Mr Seaton replied, 'That's correct.' Mr Seaton also revealed about 50 businesses, mostly South Australian, had secured contracts for work on the shipyard, most of which has since ceased. My question to the Treasurer is:

1. What talks are the state government having with the federal government to secure these jobs and seek compensation for those affected businesses?

2. What other talks is the government having to ensure these highly skilled workers don't lose their jobs or are re-employed elsewhere?

3. Has the government demanded an urgent commitment from the federal government that the majority of the country's new nuclear submarines build will be in South Australia, particularly in light of the head of the Department of Defence's Capability Acquisition and Sustainment Group taking to social media to like an article that supported the nuclear submarines being made in the US?

The Hon. R.I. LUCAS (Treasurer) (14:51): In relation to the last issue, I think the commonwealth government, the Prime Minister, certainly the Premier, and a number of other spokespersons on behalf of governments have made it quite clear that Adelaide, Australia, will be the location for these particular projects now and for the next 10, 20, 30, 40, 50 years, however long is going to be required. I don't think the honourable member and indeed those he represents need have any concerns in relation to that particular issue.

In relation to the question of the—and I haven't seen the Senate committee reports from this morning, but from the honourable member's description it would appear it is relating in part to the construction activity for the sheds that were required for the submarines that were going to be built by the French. Those sorts of skilled tradespeople are as scarce as hen's teeth in South Australia and Australia at the moment. I think as all honourable members will know, construction activity is proceeding at a frenetic pace, both residential and commercial industrial construction.

People are struggling to get skilled tradespeople for a whole variety of purposes at the moment, so those general skilled construction workers working on that type of project will be gobbled up by any number of other employers in South Australia—and possibly in Australia but certainly in South Australia—because as Treasurer, I am constantly reminded by businesses that we need to have more skilled tradespeople in South Australia, and in Australia as well, in terms of meeting record levels of infrastructure spending, both by the public and the private sector. So, yes, there has been a lot of discussion in relation to that particular component.

When one comes then to the skilled workers within the Naval Group, I am already aware that a number of those skilled workers have taken up alternative employment in other defence and defence-related industries in South Australia. The Premier, I know, did a number of interviews soon after the announcement by the commonwealth government, indicating again that the governments would do what they could to ensure as smooth a transition as possible for many of the people working in the Naval Group, particularly those with the skills that are going to be required in terms of the ongoing work in defence and shipbuilding in South Australia.

There have been discussions from the Premier and the minister—the Premier in particular, I should say—with the commonwealth government at the very highest levels in relation to doing what can be done by governments in terms of encouraging the take-up of these skilled tradespeople by other employers in South Australia in particular. I do know that the Premier himself I think convened a meeting of defence industry leaders, indicating and seeking to help and coordinate their recognition of the skill set that was available in these workers and the capacity for them to pursue skilled workers from the Naval Group into their particular businesses and industries.

The final point I would make is that I know, in relation to the defence sector generally, professional services companies and others have been highlighting to me the fact that defence primes in particular have been headhunting their best workers within their particular companies because there is a crying need for more skilled people within those defence companies in South Australia. So any number of skilled people within the Naval Group who have relevant experience in this particular sector will be very attractive prospects for recruitment for many of the defence primes and the other defence companies operating in South Australia and also nationally, but particularly here in South Australia.