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House of Assembly - Fifty-Second Parliament, First Session (52-1)
2011-05-18 Daily Xml
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DEFENCE INDUSTRY

Mr SIBBONS (Mitchell) (14:28): Can the Premier update the house on the health of the defence industry in this state in light of recent reports of a downturn in defence spending and jobs?

The Hon. M.D. RANN (Ramsay—Premier, Minister for Economic Development, Minister for Social Inclusion, Minister for the Arts, Minister for Sustainability and Climate Change) (14:28): I am absolutely delighted to report to the house that the defence industry, contrary to reports that may have been run in some sections of the media, is alive and well and on track to deliver more jobs than were actually targeted in the South Australian Strategic Plan.

I was interested to see last Friday the opposition's defence industries spokesman, the member for Waite—the once and future king—demanding that the state government commission an independent study into our defence industry. He made the remarkable claim that 'Labor's false promises on defence projects were made for elections, with no intent to deliver.' What a dodgy and ridiculous statement that was. If he tried to make a statement like this in the house, people would say he was misleading. Anyone who believes that about our defence industry must be walking around blindfolded with earplugs inserted.

We do not need to waste money on independent consultants to tell us that there is a huge amount of work going on at Techport Australia down at Osborne, on our $8 billion air warfare destroyer program which is annually contributing about $292 million into our economy and directly and indirectly will employ some 1,783 workers. The brilliant new shipbuilding facility is working full steam ahead. We do not need to waste money on an independent study to tell us that, out at Edinburgh in the city's north, more than $600 million has been invested in new facilities to support the new 7RAR Battle Group, which commenced operations at Edinburgh in January. So, just go out and have a look at what has been constructed.

When the 1,100 personnel battle group reaches its full establishment at Edinburgh by 2014, they are expected to inject $100 million into our state's economy and support 1,675 jobs on an annual basis. Nearly 700 personnel and their families have relocated here so far.

We don't need an independent study to tell us that each year 1,407 direct and indirect jobs are involved in the multibillion dollar, through-life support contract for the Collins class submarines, which is injecting $150 million into our state economy every year; or that the $1 billion AP-3C Orion sustainment contract is well underway, generating 1,023 direct and indirect jobs, and contributing $80 million annually into our economy; or that the $1 billion Customs Project Sentinel contract, the world's largest fixed-wing, civil maritime surveillance program, makes an average annual contribution of some $20 million and 126 jobs to the state's economy.

Combined, these four projects alone contribute more than $500 million and 4,000 jobs to the state's economy each year. With the exception of the AWD build program, which is yet to reach its peak, these major projects will continue to have relatively stable and long-term spending and employment profiles.

While the defence budget has identified an underspend of some $1.6 billion in the Defence Materiel Organisation's current year budget, I am told that this is due largely to significant delays in a number of major acquisition programs that are based interstate and overseas. South Australia's defence industry, on the other hand, has every reason to be optimistic about its long-term future, and with good reason.

Defence is still on track to replace 80 per cent of its war-fighting assets, but what I prefer to call peace-keeping assets, over the next 15 years. Back in 2003—and here is the nub of it, back in 2003, and I am sure that this is going to be run with a great deal of fanfare in the media because it is the sort of news about industry in the state that they would welcome—back in 2003, South Australia's defence sector employed 16,000 people. As at 30 June 2009, the last data collection, the defence sector employed 24,766 people—from 16,000 to nearly 25,000.

That is Labor's record on defence in this state. In fact, projections are that we will exceed our Strategic Plan target of 28,000 jobs by 2013, by at least 2,000 jobs. When we announced what our ambitious target was, oh no, no, no, that was far too embarrassingly a mirage down at Techport, but instead we will exceed our target by 2,000 jobs.

Mrs Redmond interjecting:

The Hon. M.D. RANN: The Leader of the Opposition, merci beaucoup for that interjection. She says that we are going backwards. So, I am not sure how going from 16,000 to 25,000 is going backwards, but maybe that says more about what she thinks about our state.

Ms Fox interjecting:

The Hon. M.D. RANN: I am informed that defence employment is projected—I am pleased I am getting support from our French-speaking Francophile, member for Bright here. She is my coach, by the way, if anyone wants to know where I get such eloquence. I owe everything to her. I think she is going to make a privilege motion now.

Ms Fox: I am.

The Hon. M.D. RANN: You should hear what the Premier of Quebec said about my French, it was even worse. I am informed that defence employment is projected to reach 30,487 people by 2013-14. This figure takes into account industry expectations as well as projected expenditure by the Defence Materiel Organisation in South Australia. So, the defence industry, in other words, is showing no signs of slowing down and is, in fact, building every year.

Members interjecting:

The SPEAKER: Order! The Leader of the Opposition.

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