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House of Assembly - Fifty-Second Parliament, Second Session (52-2)
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FUTURE SUBMARINE PROJECT

The Hon. J.W. WEATHERILL (Cheltenham—Premier, Treasurer, Minister for State Development, Minister for the Public Sector, Minister for the Arts) (11:03): I move:

That this house—

(a) recognises the state's strong commitment to defence, as a key economic driver for South Australia;

(b) notes that the federal Labor government has committed itself to the Australian build of the Future Submarine project;

(c) recognises the federal Labor government's commitment to South Australia as the home of the nation's Future Submarine project, including through establishment of the Land Based Test Site at Techport Australia and the Future Submarine Systems Centre in Adelaide;

(d) notes that the federal Liberal/National Party Coalition is yet to commit to an Australian build for the Future Submarine project; calls on the federal Liberal/National Party Coalition to rule out acquiring or leasing ready-made fleet submarines which would result in the loss of thousands of South Australian jobs overseas and the demise of South Australia's Defence Industry capabilities; and

(e) calls on the federal Liberal/National Party Coalition, as a matter of urgency before the upcoming September federal election, to commit to building Australia's future submarines at the world-class Techport Australia facility.

I rise today to move this important motion for the future of South Australia's economy and the jobs of South Australian workers. There is no responsibility for any government as serious as securing the national defence of Australia. It is the paramount concern of the commonwealth government regardless of its political persuasion or the individual men and women who make up its leadership. The decisions that it makes about our defence must be, first and foremost, based on what is necessary in order to ensure that Australia remains a strong, free, independent nation able to protect its own national interests in a dynamic global environment.

The commonwealth government must decide what capabilities are required in order to keep Australia safe. It is for them to decide whether our national defence requires a new land vehicle, a particular piece of combat equipment or, indeed, a new submarine. We respect that these decisions are not made by the South Australian government or by any state or territory government; they are made by the commonwealth government in Canberra.

The commonwealth government has, however, made it very clear why it believes that a submarine capability is essential. The Hon. Jason Clare MP, the former minister for defence materiel, described it succinctly last November:

Australia is an island. Our geography—the vast territorial sea that surrounds us—is our best defensive asset. Any country that seeks to attack us has to cross the sea. Submarines make that very difficult.

Submarines are like underwater snipers. Once they dive they are very difficult to detect and very deadly. They do more than this, but it is their most important role. Finding them requires an enormous amount of resources. This makes submarines a very real deterrent to any country thinking about harming us. That's why we need submarines.

Once the decision is made about what capabilities are required, the view of the South Australian government—as it has been under previous governments—is that wherever the Australian defence industry can deliver these capabilities effectively that we should back Australian industry to get the job done.

South Australia has a long history of maritime and naval shipbuilding. During World War II, the young steelmaking town of Whyalla was transformed by a shipyard. BHP delivered the first corvette, the HMAS Whyalla, in May 1941. Construction continued after the war until the shipyard closed in the late 1970s. Soon after the Whyalla shipyards closed, the commonwealth government began considering the construction of a new class of submarines. At that time, the then Labor government, led by the Hon. John Bannon MP, began work on convincing the commonwealth government to build the new submarines in Australia.

A history of the construction of the Collins class submarines, The Collins Class Submarine Story by Peter Yule and Derek Woolmer, documents how the Bannon government wrote a paper in 1984 which demonstrated that any additional cost for constructing the Collins class submarines in Australia would be more than offset by increased tax receipts which would be received by the commonwealth and would have a positive effect on the broader economy. Once a decision was made to build the submarines in Australia, Bannon's and the government's case moved on to ensuring that the submarines were built in Osborne.

Looking at the history, it is interesting that two of our state's competitive advantages from that time remain today. One of the key reasons South Australia was chosen was because our state had avoided the level of industrial disputation which was common in New South Wales and Victoria, still an important advantage now. The other factor which convinced the federal government was the professional advocacy of a taskforce led by Mr Jim Duncan and we are now lucky to have Defence SA under the leadership of Mr Andrew Fletcher and the wise counsel of its advisory board chaired by retired General Peter Cosgrove AC.

The impact of initiatives led by the South Australian government to secure defence projects has remained absolutely vital. As members of this place would be aware, the government's investment of more than $300 million to build Techport Australia was a key factor in securing the $8 billion air warfare destroyer contract for South Australia. The existing infrastructure at Techport will be an important part of the Future Submarine project.

The six Collins class submarines will begin to reach the end of their nominal 30 year lives in the mid to late 2020s. The process of planning the construction of the submarines which will replace the Collins class has begun. The build of 12 new submarines is the largest manufacturing project ever undertaken in Australia. It would stand as one of the largest single procurements by the commonwealth government, at least the same size as the National Broadband Network and larger than the construction of the Snowy Mountains scheme.

The commitment by the Gillard Labor government to assemble submarines in South Australia secures one of the most significant parts of our advanced manufacturing industry for decades to come. This project will deliver a remarkable level of economic benefit to South Australia and, indeed, the nation. One example of the benefits can be seen in the ANZAC ship project, which was undertaken in the 1990s. An analysis of that project by industry analyst Denise Ironfield found that it helped create more than 7,500 full-time equivalent jobs among 1,300 Australian and New Zealand suppliers. Access to technology from overseas led to greater innovation in Australian companies and created skills and capabilities which helped them win other opportunities in Australia.

More limited analysis of the Collins class program found similar results, with a report by the Senate Foreign Affairs, Defence and Trade Committee finding that there were profound benefits for Australian industry flowing from the Collins program. It found that when the project began there were only 35 companies certified to the quality levels necessary for defence work, but by 1998 that there were 1,500 as a result of the submarine project, the ANZAC frigate project and other projects. The Senate report found that of the $5.1 billion cost of the original Collins program, $4 billion was spent in Australia and the project supported 7,500 jobs. Given the vastly greater scale of the Future Submarine project it can only be reasoned that the economic impact of the subs project would be even greater today.

More recently, South Australians are benefiting from the economic boost of the construction of the $8 billion air warfare destroyers at Techport Australia. More than 1,500 workers in South Australia are employed building these world-class ships and 2,600 nationwide. For workers in Adelaide this impact is not theoretical. It means having a fulfilling job with interesting opportunities right here in your chosen industry. It is about exactly what those opposite claim to care about so much: creating jobs here in Adelaide rather than seeing them move offshore.

The economic benefits do not end at Osborne. The broader impact of the project is seen in every cash register of every shop in Port Adelaide, by every home builder in Mawson Lakes and by every cafe in Semaphore. The long-term benefit to our state's economy extends beyond the injection of cash. As the analysis of the ANZAC frigate and the Collins class projects found, the opportunities to create the capabilities for businesses in the advanced manufacturing sector are significant. I have seen this for myself when I travelled up to Osmoflo, which is a company in the mining services sector. They spoke of the fact that their high-end tradespeople were drawn from the defence sector.

So, what we are seeing is this continuum, we are seeing the car industry, the defence sector and other areas of the mining services sector, as the skills and capabilities grow and emerge and transmute as other opportunities arise. If we can create similar sorts of opportunities for South Australian businesses to grow their capacity as a result of the Future Submarine project as they did under the Collins class project, we could go some way to achieving the goal of the advanced manufacturing future that we have set for ourselves.

Last month, the commonwealth government announced that it would establish the Adelaide Defence Precinct as part of the government's innovation and industry statement. The new precinct will help secure these opportunities for South Australian businesses, as well as businesses nationally, by driving productivity, improving connections between business and the research sector and mobilising Australian industry to compete more successfully in global markets. Initiatives like the new precinct will help ensure that we realise these broader benefits. These are the sorts of initiatives that we are taking as a state government.

We are sending the clearest possible message, with strong strategic policy, but with public investment, so that private companies can know that they will achieve a return in the future because they can see the long-term commitment of their government. This is something that those opposite, I think, have a bit of trouble with and are struggling to understand: the central role of government in the economy. They are allergic to the role of government in the economy. But it is a central issue, especially in a small economy, for creating the circumstances for growth. The reality is that the Gillard government is now taking the necessary steps to move forward with the build of the new submarines. Just before the 2012-13 budget—

Members interjecting:

The Hon. J.W. WEATHERILL: Don't be blinded by your hatred of Julia Gillard and put your state second. Don't be blinded by your hatred of Julia Gillard. Just before the 2012-13 budget, the government announced that the commonwealth government would provide $214 million for the next stage of the Future Submarine project. The reality of projects of this size is that they inherently are incredibly complex and involve a significant amount of risk.

As was seen with the Collins class, the failure to plan early for maintenance and sustainment of a continually changing procurement strategy are clear factors which increase the risk of blowouts in terms of cost and time. The investment of the commonwealth government is targeted at ensuring the government can deliver the submarine project in Australia with a minimum of risk. It ensures that we learn from the missteps that were made during the Collins program and that we prevent them from happening again.

One of the most important steps towards de-risking this project is the construction of the Land Based Test Site for testing submarine systems, including propulsion, energy and integration technology. As the Minister for Defence the Hon. Stephen Smith described in his announcement of the Land Based Test Site, the creation of the facility:

will significantly reduce the risk of delay and cost overruns, poor availability and increased operating and sustainment costs, loss of capability and most importantly, the risk of catastrophic accident caused by the failure of power and energy systems.

In December, the commonwealth government announced that the Land Based Test Site, along with the Future Submarines Systems Centre, would be based in Adelaide. These are incredibly important steps to ensure that this is indeed the home of the construction of the Future Submarines project at Techport.

The next set of decisions that need to be made by the commonwealth relate to the precise sort of submarine which will be delivered in order to meet the needs. There are four broad options for the construction of submarines which are being considered by the commonwealth government, and they are described by them as this:

an existing submarine design available off-the-shelf, modified only to meet Australian regulatory requirements;

an existing off-the-shelf design modified to incorporate Australia's specific requirements, including in relation to combat systems and weapons;

an evolved design that enhances the capabilities of the existing off-the-shelf designs, including the Collins Class; and

an entirely new developmental submarine.

The Gillard government has ruled out buying nuclear submarines. Nuclear submarines would be a devastating outcome for local industry, because its inevitable consequence is not only the lack of construction offshore but the maintenance and sustainment would be undertaken in another country.

Clearly, of the remaining options, some are better for our state than others. It would deliver the best outcome for South Australia if as much of the design occurred in Australia as possible. At every stage, our government will be an advocate for this outcome. But what is guaranteed in each of the options is that, in every single one of these options being considered by the Gillard government, the assembly will be at Osborne at Techport by Australian workers.

The world 'assembly' does not do justice to what in fact occurs when you put together a vessel of this size and complexity. It is like constructing a small city. Each of the elements of the hull have extraordinary amounts of sophistication in the way in which they are put together. The work is very high-end work. It will create thousands of jobs even in the case that involves the least amount of design work done within this state.

On the other hand, what we see from the federal Liberals is that the option of importing the submarines from a foreign country is firmly on the table. Last year, we had Senator David Johnston, the federal Coalition's spokesperson on defence, say on Lateline on 28 March 2012:

If the Coalition was to think that it's more cost-effective and a better capability to acquire a ready-made solution, we would certainly be interested in that.

In May last year, the federal Coalition Treasury spokesperson the Hon. Joe Hockey, told the ABC's AM program that:

Now either that's $200 million that is going to be wasted or else the government is going to have a proper analysis of whether there are alternatives to having these submarines manufactured in Australia.

An article by Ben Packham in The Australian on the same day revealed that there were even South Australian Liberals willing to speculate about submarines not being built in Australia, with the member for Mayo, Jamie Briggs, described as backing Mr Hockey's assessment. This is the same Mr Briggs that said that we should not be supporting Holden, as well, so he does have form in this regard.

While the ongoing speculation that these reckless remarks are causing is unhelpful to local industry, the impact that these words would have on government policy would be catastrophic. Buying submarines from foreign countries would devastate ASC and hundreds of local suppliers and hack into our naval industry. It would destroy a capability that this nation has invested in over two decades and one that would take decades to redevelop, if it were ever possible at all. It would stunt our state's advanced manufacturing future and hurt our ability to compete for defence projects in the future.

Despite these disastrous risks, we know what Tony Abbott fundamentally thinks about it and we have heard the remarks. Remember the leak that came out of the caucus there—'Don't worry about a gigalitre of water here or a dollar of subsidy there' (which was a clear reference to the River Murray and also to Holden's). What he was really saying—because people were getting nervous at that time about whether they were going to win—the coded message to the caucus was, 'We can win this without South Australia; don't worry about it; just relax.' That was the message he sent to his party room, and we should be chilled by that message: that he would be prepared to cut South Australia adrift should he become prime minister.

The clear choice for South Australians is between a Gillard government, which has guaranteed that future submarines will be built in Adelaide, and an opposition without a guarantee—

Mr Venning: You've got to be kidding.

The Hon. J.W. WEATHERILL: Well it is. It is a clear guarantee and they have backed it up—

Mr Marshall: A guarantee?

The Hon. J.W. WEATHERILL: It is a guarantee, and they have backed it up with three critically important decisions. They are only analysing four options and they are all about building them here. They are building a land-based testing system here and they are building the design centre here. They are actually backing up their commitments with actions and with dollars. All you have to do to remove any doubt at all is to persuade your federal colleagues to actually back the Gillard government's proposition. That is all you have to do. Stop being so blinded by your hatred for the federal Labor Party that you cannot see what is in the interests of your own state.

This is the problem, this has been consistently the problem with those opposite: they cannot see through the red haze of their own hatred to understand the clear imperative about what is in South Australia's best interests. It is one of the reasons why you cannot get yourself together to actually run a proper party over there, because you are animated by personal hatreds.

Members interjecting:

The Hon. J.W. WEATHERILL: You are animated by personal hatreds; it is in your DNA.

Ms Chapman: Point of order.

The Hon. C.C. Fox interjecting:

The SPEAKER: The Premier will be seated. The member for Bragg, the deputy leader is about to make a point of order but, before she does so, I call the Minister for Transport Services to order. Deputy leader.

Ms CHAPMAN: The Premier is continuing to address his remarks to you, as he should, but he is being critical of you in your incapacity to be able to control anything, so I ask that he be called to order.

The SPEAKER: Yes, the deputy leader is right; all remarks should be through me. I have a perfect understanding of those things the Premier is raising. I think he means to say the parliamentary Liberal Party does not have an understanding of those things.

The Hon. J.W. WEATHERILL: I do, indeed, sir, and all of my previous remarks should be taken as a reference to those opposite. They simply need to just pause for a moment, to reflect for one moment on the importance of backing this motion, and do more than that. They should not do it the way they backed the Holden's and the River Murray motions, where they spoke against them and then cravenly did not bother to vote against them because they did not want the criticism.

We want the opposition to not only support this resolution, but give voice to their support by actively lobbying Tony Abbott and the federal Coalition to ensure that they match the federal Labor Party's commitment in relation to this matter. That is what would be in the state's interests. That is precisely what any opposition actually interested in the state's interests would do, rather than advance some petty political interest it may have in wanting to embarrass, damage or ridicule the federal Labor Party in government. So I ask the opposition to put the state ahead of party and back this resolution and, more importantly, back it with action.

Mr MARSHALL (Norwood—Leader of the Opposition) (11:23): I move to amend the motion as follows:

Delete all the words after 'as a key economic driver for South Australia'

When the Premier came to his job in October 2011, he said he wanted to focus on the substance of the issues and deal with policy outcomes instead of political point scoring. Instead, he today brings this motion—little more than a political stunt—before this parliament. This motion is an attempt by a state premier to do a favour for a struggling federal Labor prime minister and to distract from a federal Labor government in crisis. Instead of seeking a bipartisan effort to secure outcomes for the local defence industry, by moving this motion the Premier is seeking to sling mud and misinformation across the chamber for political points.

The only political approach that will work for the development of defence industries in South Australia is one of bipartisanship and mutual support for our industry. If we seek to divide by unnecessarily politicising the issues, we will only hurt the South Australian industry. Some parts of the motion are worthy of merit. I welcome on behalf of the opposition that part of this motion which recognises the state's strong commitment to defence and to the submarine project SEA 1000 as a key economic driver for South Australia.

I also welcome the point made in the motion that federal governments of all political colours need to commit themselves to a build of the future submarines which is based here in Australia. I would in fact go further to argue that as much as possible of the design and construction of the future submarines needs to occur here in South Australia, a point missing in part 2 of the Premier's motion. Those parts of the motion which seek to politically attack—

Mr Hamilton-Smith: He didn't even include it in the motion.

The SPEAKER: I call the member for Waite to order.

Mr MARSHALL: —the federal Coalition from an insubstantial foundation and which seek to argue that the Gillard federal Labor government is somehow more supportive of naval shipbuilding in South Australia than is the federal opposition will be seen by the public precisely for what they are: professional politicians playing politics rather than looking for real outcomes for South Australia. For that reason, the opposition will be opposing the motion in its current form; it is partisan and diminishes the esteem in which this house is held. Today's motion is not a genuine effort to improve the state's standing in attracting defence investment and advancing the Future Submarines project.

What a shame it is, Mr Speaker, that the Premier did not bring forward something which recognises that we all need to work together here in South Australia, regardless of which party is in government federally, to optimise the outcomes for defence investment here in South Australia. Instead we have a motion which constitutes an attempted political attack and which will do nothing to advance the Future Submarines project or optimise the amount of work and investment that is attracted to South Australia.

The unfortunate partisan nature of the motion has given the house an opportunity to put the spotlight on the federal government's performance both on the submarine project and on defence investment more broadly. In debating the motion, the Premier has surely kicked an own goal by highlighting the considerable failures of the Gillard Labor government to get behind South Australia. This state must have a steady and sustainable pipeline of defence projects, particularly in shipbuilding and capital works investments. Without that deal flow and continuity of work, the South Australian defence industry faces considerable pressure to retain its skilled workforce, investment and infrastructure.

Let there be no doubt in anyone's mind about the unreserved and unequivocal commitment of the state Liberals to defence and to South Australia as the home of future naval shipbuilding and, in particular, as the construction base for the forthcoming fleet of 12 submarines promised by the federal Labor Party when former prime minister Kevin Rudd was in charge. That is the point, Mr Speaker. The current Prime Minister, Ms Gillard, has backed away from her predecessor's position on defence spending, investment and submarines, and this has delivered much uncertainty to the defence industries here in South Australia. In late 2007, the Rudd-led federal Labor opposition promised that in government Labor would:

…build a new generation of submarines in Adelaide. The submarines will be built by ASC at its Port Adelaide site and the aim will be to have the work commenced before the last Air Warfare Destroyer is completed—

'before the last Air Warfare Destroyer is completed'—

It is expected that the construction of the first new submarine would commence around 2017, near the time that work on the Air Warfare Destroyer project will be tapering off.

These statements by Kevin Rudd proposed that the submarines be built entirely in Adelaide. He said, 'The submarines will be built by ASC at its Port Adelaide site.' One can only assume—

Mr Hamilton-Smith: Bring back Kevin.

Mr MARSHALL: Yes, exactly. One can only presume that Kevin Rudd's position was that 100 per cent of the work would come to Adelaide; work that has been estimated by the Australian Strategic Policy Institute to be as high as $36 billion and which former premier Mike Rann claimed during the last state election campaign was as high as $40 billion. Of course, under Kevin Rudd and Mike Rann, Labor told South Australians that we had won the $8 billion air warfare destroyer project, suggesting that all investment would flow to South Australia. We found out later that little over $1 billion of that work was being spent in South Australia, with the remainder being written in cheques to Spain and other states for the construction of blocks and components elsewhere.

Kevin Rudd and Mike Rann also proffered a fourth air warfare destroyer. It has not happened. Labor's failure to deliver a fourth air warfare destroyer project has been bitterly disappointing and places even more importance on the Future Submarines project to sustain the local defence industry. This is because of the need for continuity of work to cover the gap between the air warfare destroyer project and the Future Submarines project.

We are now more than halfway through the 10 year lead-in time for this important project, and there is very little certainty for our local industry on the development of this crucial project. In recognising defence industries as a critical economic driver for the South Australian economy, we note 2017 as a crucial date in the sustainment of that industry here in South Australia. As workflow emanating from the air warfare destroyer project tapers off in 2017, the industry will be hit with what it refers to as a 'valley of death', losing its highly skilled workforce, unless the Future Submarines project is in the pipeline and ready to go.

This is a capability gap that the federal Coalition has committed itself to avoiding. After nearly two terms of Labor government there has been no final decision, and instead the industry will have to wait until after the federal election on 14 September. Labor has abandoned its responsibility, continually delaying and deferring a decision.

Let us focus in more directly on Labor's promises under former prime minister Kevin Rudd. By the time of the May 2009 Defence White Paper, Kevin Rudd's late 2007 pre-election promise to build the submarines completely in South Australia was dumped. Instead of being wholly constructed in Adelaide, Labor now said that the new submarines would only be assembled here in South Australia. So Labor was beginning its retreat from its promise to the people of South Australia as early as May 2009.

Just like the highly vaunted air warfare destroyer project—which, as I mentioned a moment ago, has delivered a little over $1 billion to South Australia from the $8 billion total investment—the South Australian component of the Future Submarines project will now likely be limited to the final assembly. Blocks or substructures of the submarines may well be built elsewhere, as is now common practice in shipbuilding around the world. Labor's 2009 white paper said about the submarines at the time, 'For this project to succeed, we need to engage with a number of overseas partners during the design and development phase.' In particular, the government intended to continue the very close level of Australian/US collaboration in undersea warfare capability.

On 21 January 2010 soon-to-be axed prime minister Rudd reaffirmed that, 'As Prime Minister of Australia I confirm in absolutely clear cut terms that our next generation of subs will be built here in Adelaide', again spinning the line to the media and the public that 100 per cent of the work would come to South Australia, while Labor's own defence white paper argued that work needed to be pushed overseas in the design and development phases.

Was Kevin Rudd, along with former premier Mike Rann, his factional ally and friend, once again over-spruiking and overselling the federal Labor government's commitment? Perhaps the mixed messages reflected an effort by Rudd to paper over early divisions within his cabinet on the submarines project. There were very few South Australian ministers around the Labor cabinet table. Was he losing ground in the debate, just as he was losing the confidence of the then deputy prime minister and the factional heavies?

The political execution of Kevin Rudd in the months that followed, led by the current Prime Minister, put an end to his vision for naval shipbuilding here in South Australia, because since then Julia Gillard, along with her factional ally and political friend Premier Weatherill, the mover of this motion, have been paddling backwards at a rapid rate of knots.

Since Prime Minister Gillard's anointment by the faceless men of Labor, defence spending and Labor's commitment to shipbuilding in South Australia have been torpedoed and are sinking like a stone. The May 2012-13 commonwealth budget saw defence spending cut to historic low levels. Without a whimper from the current Premier of this state, the defence state, Prime Minister Gillard and Treasurer Wayne Swan stripped a total of $5.45 billion over the forward estimates through to 2015-16. Most importantly, capital investment and the defence capability planned cuts total $4.2 billion of the $5.45 billion worth of cuts.

Where has the state Labor Party been during the debasing of defence investment by their political comrades in Canberra? Instead of grandstanding and speculating in state parliament about the federal opposition, based on misinformation, why did the Premier not put pressure on the government of the day to stop them stripping billions of dollars worth of opportunities for this state? Julia Gillard has been tearing up the Rudd vision on defence. Before his election in November 2007, in a policy document, Labor's Plan for Defence, Rudd said:

Labor is committed to maintaining defence spending, including a minimum annual 3 per cent real growth until 2016, and is committed to ensuring that Defence dollars are spent more effectively and efficiently.

Well, Prime Minister Gillard has done precisely the opposite: defence spending has been cut by 10.5 per cent in this current financial year, according to the Australian Strategic Policy Institute. This is the largest annual reduction since the end of the Korean War in 1953. Under Labor, as a share of GDP Australia's defence spending will fall to 1.56 per cent—the lowest since 1938, with further falls to come.

In making such savage cuts, and in a vain effort to deliver their now broken promise of reaching surpluses in 2012-13 and beyond, the Gillard Labor government has left Australia's defence and defence industries exposed and vulnerable. Dr Mark Thompson of the Australian Strategic Policy Institute said in May 2012:

Plans to put in place the so-called force 2030 are in tatters. The 2009 defence white paper is dead.

On 21 July 2012, Professor Andrew Davies of the Australian Strategic Policy Institute described the cuts as 'very simply budgetary'. These cuts only add further pressure on industry sustainability and Australian capabilities. In May, Professor Alan Dupont, of the University of New South Wales, passed judgement on Labor's performance on the submarine project, stating:

...it's touch and go whether we will have any subs to deploy because there's...so much delay in the process.

Continually we see the federal Labor government backing away from the Rudd vision. On 3 May 2012, days before the horror 2012-13 budget was handed down, Prime Minister Gillard sought to obfuscate the looming cuts of the defence budget to historic lows. The Prime Minister watered down her previous public comments by telling the people on that day:

...we are heading towards those new submarines being assembled right here in South Australia.

The original 2007 commitment to a full build in South Australia was first watered down to the assembly in South Australia. Without batting an eyelid, the Prime Minister further downgraded her commitment saying they were simply heading 'towards an assembly' in South Australia. With the Premier by her side, and a stroke of the pen, the Rudd reality of a full commercial build of the Future Submarine project in South Australia was, five years later, little more than another vague aspiration from Labor.

Adding further confusion to Labor's position on naval shipbuilding, in 2012 former defence minister and now government whip, Joel Fitzgibbon, expressed his regret at not considering the nuclear option for the Future Submarine project. Experts agree that such an option would see the leasing of submarines from the United States, with very limited opportunities for local design and construction input. It might very well write the Australian industry out of the project almost completely.

This undisciplined revelation by Fitzgibbon further demonstrates Labor's lack of competence and unwillingness to provide certainty to the Australian defence industry. No wonder that Labor has continually deferred the decision as the Prime Minister faces pressure from within caucus to completely dump the South Australian component of the Future Submarine project, a move publicly argued by the former defence minister.

Since Kevin Rudd's pre-election promise in 2007, Labor has only continued to delay and defer crucial investment in the Future Submarine project. The ASC, who built the Collins class submarines, have been forced to delay phase 1A, which was to be completed in 2010-11, and phase 1B (preliminary design) was to be completed in 2012-13. Phase 1C's detailed design is uncertain at best. Another fresh study announced in December to further examine the submarine project has only caused further delays.

I notice that the Premier's motion asks that the house 'notes that the Federal Labor government has committed itself to the Australian build of the Future Submarine project'. As recently as December, the defence minister, Stephen Smith, stated, as he has done on repeated occasions:

We continue to exhaustively assess all of the options—all of the options are an off-the-shelf submarine, an off-the-shelf submarine modified, a derivative of the Collins or a brand new design.

On 10 February, the federal defence minister, Stephen Smith, again reiterated that the nuclear option is the only option that is not on the table.

That leaves a lot of options on the table for the Gillard-led Labor government to come back after the election in September and decide that a South Australian build is not necessary. The next question is: when will a decision be made by the federal Labor government? We have had over five years of backflips and deferrals. When will Prime Minister Gillard and defence minister, Stephen Smith, commit to this project at all?

The Labor government's defence white paper 2013 is due in the first half of this year. This will be the most important statement from the commonwealth on its defence industry, and very much of our focus here in South Australia will hinge on the determinations and priorities in this paper. It will be a departure from the more ambitious and higher-spending white paper produced by former prime minister Kevin Rudd in 2009.

However, federal defence minister, Stephen Smith, has indicated that the commonwealth is only aiming a final decision on the Future Submarines project in late 2013 or early 2014. Federal Labor is proposing a new defence white paper with one of the key contingencies—the design, modelling and construction of the Future Submarines project—completely left out. Given Labor's long-established track record of delaying and deferring decision-making on the Future Submarines project, who knows when such a decision could actually be made?

In summary, the mover has brought this motion to the house with, in my opinion, only a political motive and a political objective in mind. The motion before the house does absolutely nothing for the future of the South Australian defence industry. As I have explained, we must all work tirelessly with our colleagues in Canberra of whatever political persuasion to advance the submarines project and to optimise defence investment and capital works here in South Australia.

It is a challenge that requires hard work, bipartisanship and sound arguments, well argued and thoroughly supported. I have explained that former prime minister Kevin Rudd understood the importance of this project. That is why his defence white paper on this issue was clear and strong. Rudd followed the sound positioning of defence established by the Howard government. Mike Rann stood beside him and, with firm resolve on all these projects, said that these submarines would be built here in South Australia. It is a case of the Rudd-Rann team getting it right and the Gillard-Weatherill team getting it wrong and failing the defence industries in South Australia.

If the federal Labor government had any intention of ensuring the construction of the Future Submarines project at Techport, they could unmistakably and publicly commit to the project today by selecting a design and putting the money on the table. The federal Labor government has had more than five years to do so, and now they seek to further defer the decision until after the September election. They have taken it from a definite commitment to assemble, to working towards assembling, to a deferred decision until after the next federal election. Labor's financial mismanagement at both the federal and state levels has moved the goalposts and moved the project into complete and utter disarray.

The opposition will not be supporting this motion in its current form, because it is not a genuine motion. It is a failed attempt at wedge politics and a poorly conceived effort at that. What the Premier needs to do is always act and speak in the best interests of the people of South Australia including, in this case, the many people whose jobs depend on the defence industries. We need to work together on defence and not play politics on it; it is just too important.

The state Liberals and the federal Coalition want to see 12 submarines built in South Australia with an optimum involvement by South Australian industry. We understand that there will be a need to share the work across the country, as is the case with the air warfare destroyer and with all projects, but we want to optimise South Australia's involvement and participation. Rather than bringing this motion to the house, what the Premier and his team should be doing is going to Canberra and taking this view to his colleagues and friends in the commonwealth government.

The Hon. J.J. SNELLING (Playford—Minister for Health and Ageing, Minister for Mental Health and Substance Abuse, Minister for Defence Industries, Minister for Veterans' Affairs) (11:44): There is one political party at a federal level that is committed to the Australian build of the future submarines, and that political party is the Australian Labor Party. We are very proud of the fact—

Members interjecting:

The SPEAKER: Would the Minister for Defence Industries be seated? The Leader of the Opposition is called to order and the deputy leader is warned for the first time. These warnings carry over into question time.

The Hon. J.J. SNELLING: There is one political party which has equivocated on the issue of the building of a future submarine here in South Australia, and that is the federal Liberal Party. That does not surprise me. It does not surprise me that Mr Abbott has no concern about jobs here in South Australia. What does surprise me is what we see this morning, and that is the tepid support from the South Australian Liberal Party for this important project—this project that is going to transform the South Australian economy. They are not even prepared to support a motion calling upon their federal colleagues to support an Australian build.

There is one person in Australia who casts a shadow over the Future Submarine project, and that is Tony Abbott, and here we see a state Liberal Party that is not prepared to advance an argument to Mr Abbott and their federal colleagues that the submarine should be built in South Australia—that South Australia should have an advanced manufacturing industry, that South Australia should have a large share of what will be a $36 billion project.

If the federal Liberal Party decided for a military off-the-shelf option, purchase a submarine from overseas or, heaven forbid, lease nuclear submarines from the United States, what would be the position of the state Liberal Party? They would go quietly and see the South Australian economy go quietly into the night. A completely gutless display from the Leader of the Opposition. I would have thought—

Mr MARSHALL: On a point of order, Mr Speaker: I am not sure whether the minister should be referring to me as a 'gutless leader'. I think that is unparliamentary, sir.

The SPEAKER: I do not think it is unparliamentary, but has the Leader of the Opposition taken offence and does he—

Mr MARSHALL: Unequivocably, sir.

The SPEAKER: The leader regards the words as offensive.

The Hon. J.J. SNELLING: In deference to the finer feelings of the Leader of the Opposition, sir, I am happy to withdraw the word 'gutless'.

The SPEAKER: Thank you, Minister for Defence Industries; you have the call.

The Hon. J.J. SNELLING: Submarines are essential to Australia's defence. They provide Australia with a new and more potent defence capability, with a greater range and longer patrol endurance. They are a formidable deterrent through their strike capability. They protect our fleets and sea lanes; they offer intelligence, surveillance and reconnaissance collection. It is vital that we get our submarine capability right because the consequences are enormous in both a tactical and an economic sense.

South Australia has been focused on building up its defence industry since 2003. If you combine the Department of Defence and the specialist industry, the defence sector employs close to 27,000 people, directly and indirectly, and there has been an 18 per cent increase in the number of people employed over the last four years. The industry earned $1.8 billion in defence-related revenue in 2010-11, which represents a 50 per cent increase since 2007-08.

The defence industry is a major component of the state's advanced manufacturing sector, employing highly-trained people in a wide range of specialist areas, including naval shipbuilding, maritime surveillance, aircraft support, joint strike fighter components, electronic warfare and systems integration. Over 60 per cent of workers in these areas were employed in professional or managerial roles, highlighting the high-tech, highly-skilled nature of the industry.

We were delighted to learn in May 2012 that the federal Labor government had committed to building 12 new submarines here, a project worth up to $36 billion. I am sure that the house can recognise why South Australia is the obvious choice. We pride ourselves on being the defence state. Over the last 10 years, this government has sought to attract defence industries to this region, and it has worked collaboratively with business to win contracts.

South Australia is responsible for about 25 per cent of Australia's total defence procurement spend. We are currently investing in the necessary skills and infrastructure. Our commitment is mirrored by the many South Australian-based firms, such as ASC, Saab Systems, Pacific Marine Batteries, Babcock, BAE, Lockheed Martin, Raytheon, Ultra Electronics, Nova Group and MacTaggart Scott and hundreds of SMEs. This industry provides thousands of local jobs and has generated major capital investment in the Techport Australia naval shipbuilding precinct over the last five years.

Techport Australia is undoubtedly the best place for future submarines to be built. It is home to the nation's largest concentration of specialised shipbuilding design, engineering and production expertise. Some 2,000 highly skilled workers are located on site and dozens of highly capable subcontractors and component suppliers are located close by. Techport is an exemplar precinct for advanced manufacturing. Modular ship production and systems integration techniques are being employed on the $8 billion air warfare destroyer build project and the Collins class submarines are being efficiently sustained by ASC.

AWD is the single largest and most complex defence project ever undertaken in Australia. The Air Warfare Destroyer Alliance—that is ASC, Raytheon Australia and the Australian government—is responsible for delivering three air warfare destroyers to the Royal Australian Navy. The AWDs will provide a significant increase in the Navy's air warfare capabilities through their antisubmarine and antisurface warfare capabilities, as well as the ability to embark a helicopter at sea.

The alliance is working with Navantia as the chosen platform system designer. The alliance is also working alongside the US Navy and Lockheed Martin Corporation to deliver the world-class Aegis Combat System, which is capable of detecting and defeating multiple hostile aircraft and missiles at ranges in excess of 150 kilometres. There are about 1,400 people directly working on the AWD project in South Australia and a total of 2,300 across Australia. The AWD project is in full production phase, running from 2009 to 2016.

The ships are comprised of 31 modules, with overall distribution of work across four locations: Forgacs, in New South Wales, making 44 blocks; the Australian Submarine Corporation, here at Techport, 25 blocks; BAE Systems, in Victoria, 11 blocks; and Navantia, in Spain, 13 blocks. Blocks are delivered to the Australian Submarine Corporation at Techport Australia for fabrication and assembly.

Consolidation of the first ship (HMAS Hobart) commenced on 6 September last year and will be delivered in March 2016. HMAS Brisbane and HMAS Sydney will be delivered in September 2017 and March 2019 respectively. Over peak construction years, the project will make an average contribution of some $292 million to our economy and provide 1,783 jobs, both direct and indirect, for South Australians.

Late last year, the federal government announced its decision to construct a land-based test site and the Future Submarine Systems Centre here in Adelaide. The submarine land-based test site will test submarine systems, including propulsion, energy and integration technology, for application in the Future Submarine project and maintenance of the Collins class fleet.

We are delighted with the commonwealth's decision to base the land-based test site in Adelaide. The government has, for a number of years, presented a compelling case for the test site to be based here and, in January 2012, I went to Canberra to personally lobby relevant defence leaders to have the facility here in South Australia.

The systems centre will be the home of the future submarine program. It will be formally established this year and, over the next few years, will expand to include hundreds of defence personnel from the Navy, the Defence Materiel Organisation, the Defence Science and Technology Organisation and the Australian and international defence industry. The systems centre staff are already working here in Adelaide and are temporarily based at ASC.

Building the submarines will be transformational to South Australia. It will create thousands of jobs through the initial life of construction and sustain thousands of jobs over the 30-year life of the submarines. In deciding to build here, the federal government will ensure that we maintain a technological edge. This is the best guarantee of our long-term security. The opposition has a clear choice and the new leader—

Mr Gardner: Sit him down.

The Hon. J.J. SNELLING: —has a chance to show some leadership. Are they Liberals first or South Australians?

The SPEAKER: I call the member for Morialta to order, because he may have noticed I allowed the leader to run over time to complete his remarks and members of the government did not roar at me, 'Sit him down.' So, I would ask the member for Morialta's forbearance, and I call him to order. The Member for Waite.

Mr HAMILTON-SMITH (Waite) (11:54): Thank you, Mr Speaker. Rarely does an opposition—

The Hon. J.W. WEATHERILL: Point of order.

The SPEAKER: I am sorry, member for Waite; there is a point of order from the Premier.

The Hon. J.W. WEATHERILL: I apologise for that, you were in full flight. It is a point of order just for clarification. I thought it was the practice—I do not know whether it is consistent with standing orders—that when a member is concluding a sentence usually there is an indulgence to allow you to complete that sentence when the time begins to come to an end.

The SPEAKER: Yes, that is indeed the practice; the Premier is correct. The member for Waite.

Mr HAMILTON-SMITH: Rarely does an opposition receive a gift like this motion from a premier. There are no media here today and I noticed when the Premier began there was one frontbencher and I think three, perhaps four, backbenchers present. I wonder why the government has not gone out and fanned this issue up. I will tell you why and that is because it is one of the biggest blunders a premier has made in living memory. Bringing in a motion like this, when his Labor colleagues have cut $5.5 billion out of defence, is something that the house will remember for some time.

In moving this motion himself, the Premier has highlighted the continual failure of the Labor government to provide any sense of certainty, not only about the future submarines, but about defence spending more broadly. What we have learnt from today's debate, if anything, is that Labor cannot be trusted to deliver on the future submarines. The yawning chasm between Labor's rhetoric and the delivery is a constant. As we have heard today, there has only been one direction with this project under federal Labor and that is backwards. As it is written, the motion fails on several counts. Let me just draw that out because what the Premier has done with his brilliant act of moving this motion is spotlighted four key issues.

Firstly, he has given us an opportunity to talk about the Rudd-Gillard issue because when Kevin Rudd was prime minister he had a much stronger positioning on the submarines. He said they were all going to be built right here, lock, stock and barrel, 100 per cent. His commitment was unequivocal, his commitment was firm, but Julia Gillard came along. I know the former premier, Mr Rann, the former member for Ramsay, was with Kevin, but I know the current Premier is with the current Prime Minister, Ms Gillard. The first team was a lot better for defence in South Australia than the second lot. The second string have really let defence down. So we are happy to talk about how good Kevin Rudd was for defence in South Australia and Mr Rann, and how bad Julia Gillard and her mate, the current Premier, are on defence—nowhere near the first team.

Secondly, in moving this motion the Premier has highlighted the poor shape of defence industries under his leadership compared to his predecessor because, since there has been a change of premier, things have gone backwards. Now there are a lot of reasons for that, but it has presented unique challenges to the current Premier and we are going to talk about that.

Thirdly, what the Premier has done is demonstrate his complete lack of influence in Canberra with his colleagues. Mike Rann went to the last election saying, 'Who can get a better deal from Kevin Rudd, the Liberals or me? It will be me,' and he went to see Kevin Rudd and he was going to give us 100 submarines, and what has happened here, what the Premier has done, is shown that his influence in Canberra can be written on the back of your little fingernail with room to spare, that is how much pull he has got in Canberra.

But the fourth thing that the Premier has done with his brilliant motion is that he has upset his own commitment made when he first became premier, to require high standards of meaningful civil discourse, because this is nothing but a politically contrived jab at the federal Coalition which has as its goal nothing but political mischief and nothing at all of substance. Today's motion is nothing more than a transparent partisan swipe.

There are 26,000 people whose jobs depend on this debate. There are over 1,400 directly employed in the Air Warfare Destroyer Project alone. They are going to read the Hansard, because I can tell you that we are going to send it to as many of them as we can. This is one of the dumbest motions, I think, a premier has ever brought forward. If there has ever been an own goal this is it. Now I want to talk about the $5.5 billion you and your mates—he and his mates have cut from defence spending. Excuse me, Mr Speaker, I don't mean you, of course—

The SPEAKER: Thank you.

Mr HAMILTON-SMITH: —I mean the honourable the Premier.

The SPEAKER: I have cut nothing.

Mr HAMILTON-SMITH: I know you wouldn't have done it, Mr Speaker. If you had been the Premier you would have a lot of influence in Canberra I have no doubt. No-one benefits from this sort of motion; no-one benefits at all. After five years of Labor we have very little to show for it. I want to talk about what a great job Kevin Rudd did when he was the prime minister because he was unequivocal. This is what he said:

The submarines will be built by ASC at its Port Adelaide site and the aim will be to have the work commence before the last Air Warfare Destroyer is completed.

Bring back Kevin, he was so much better than Julia. She has been an absolute disaster, particularly for the submarine project and defence. That's what Kevin Rudd promised; that's not what Julia is promising—no, no, no. The bloody coup saw an end to that. Let me just run through it: within a year of her prime ministership, within one year, she cut $1.1 billion from major defence projects. Out went Air 5402, a $256 million helicopter program; Air 9000, the MRH, $56 million; Air 87 ARH, $17 million; JP 2008 Phase 4, $70 million; Air 5077, the AEW&C, $61 million; Sea 4000, $55 million gone; and 25 minor projects also gone.

I have a news report here—and I know I cannot refer to it, so I will just make an oblique reference to it—about the $5.5 billion that The Australian (that fine publication) observed was to be cut under Julia Gillard from the budget. The defence capability plan loses $1.65 billion.

The SPEAKER: Member for Waite, I think you can quote publications in our media in debate; it is just that you cannot ask in question time whether they are true or not.

Mr HAMILTON-SMITH: In that case you have inspired me to go on even further, Mr Speaker.

The SPEAKER: I'm pleased.

Mr HAMILTON-SMITH:The Australian then observes that the major capital investment program ($1.3 billion of cuts) major capital facilities, $1.2 billion—I mean, it just goes on and on and on. Labor is delivering absolute and utter ruin. But Julia came along after Kevin—after she had knifed him in the back, after she had torpedoed him, after she had strangled him, thrown his remains over the side and buried him at sea—who had promised the submarines and she said, with this premier at her side, 'I've got a big announcement about the submarines.' This is what she said:

...we are heading towards those new submarines—

you know, the ones Kevin Rudd used to talk about—

being assembled right here in South Australia.

She is 'heading towards'. She was heading towards leading a government without a carbon tax. She has been heading towards so many things that have not happened it is not funny, and now she is 'heading towards' assembling the subs. Come on!

This is a ridiculous motion. I am stunned that the Premier accepted advice to move it, probably from the Minister for Defence Industries. His staff should have intervened and stopped this motion from being put. It is an embarrassment to the mover. It should not have been put before the house. All it has done is make a mockery of the federal Labor government.

Can I say that with friends like the mover of this motion, Julia Gillard does not need enemies—let me tell you. Just keep this up, could you, all the way through to September. Let's have a few more. It is a very serious issue, and I would ask the Premier to lift his gaze. The real issue here is not just about the 12 submarines, important though they are and determined as we are as a Liberal Party to see them built.

The real issue is that over the next 30 years there will be a quarter of a trillion dollars spent on naval shipping, according to Kevin Rudd (we are not sure about Gillard), and Defence SA has made that point. We need to look at the entire package. We need to get it right with shipbuilding, we need to work in a bipartisan way together, we need to build more than 12 submarines, and we need to be rolling out a ship at ASC into the water every year for the next 30 years.

I say to you, Mr Speaker, that if the Premier came in here and moved a meaningful motion that called for bipartisan support for a grand vision for naval shipbuilding in South Australia he would have nothing but support from us. But to allow himself to come in here and try to score petty political points with utter mischief and nonsense and embarrass Julia Gillard and his Labor colleagues and make a fool of himself, really, it is just embarrassing.

The Hon. T.R. KENYON (Newland—Minister for Manufacturing, Innovation and Trade, Minister for Small Business) (12:05): The member for Waite just outlined that he would like to send the Hansard of this debate to workers and employees at the ASC. I hope he does because what they will see is an opposition not prepared to stand up to a federal opposition. It is not even a federal government. The opposition is not prepared to stand up to a federal opposition leader in their own party, afraid of upsetting the apple cart somehow. His job and his relationships with the federal opposition leader are more important than the jobs at the ASC—and that is what taking the Hansard down there will show. I hope that they do it because it is a ridiculous attitude when the members on that side of the house cannot bring themselves—

Mr Marshall interjecting:

The SPEAKER: Minister, would you be seated. It is my melancholy duty to warn the leader for the first time. Minister for Manufacturing.

The Hon. T.R. KENYON: It is a very sad day when the Leader of the Opposition and those on that side of the house are not prepared to put the state and the jobs of thousands of employees in South Australia ahead of a relationship with the federal opposition. That is a very sad state of affairs in this state.

It is not important what Kevin Rudd said; what is important is what Tony Abbott will not say—he will not commit to building the boats and the submarines in South Australia. That is what is important—what Tony Abbott will not say. You can go back and you can talk about Kevin Rudd all you like, and we can discuss it until the cows come home, but what is important here is what Tony Abbott will not say; that is, he will build the submarines in South Australia—unlike the federal government, who will build submarines in South Australia.

We know it is going to happen, and we know there are going to be submarines and they are going to be built here in South Australia, and Tony Abbott cannot even bring himself to commit to that. This opposition is even worse when they cannot even take on Tony Abbott and try to get that commitment out of him. They refuse because their relationship is more important than jobs, and their relationship is more important than a whole industry. Their failure to take on their federal colleagues is an absolute disgrace.

We all know the benefits of the industry here, and we all know the benefits of the submarines here: it is a chance to build on and expand our manufacturing base and get into advanced manufacturing—and they will not do it. They will not take on their federal colleagues to assist in the growing of that manufacturing base—they will not do it. They are high paying jobs, but they do not care. It is more important to be friends with Tony Abbott than to get high paying jobs for South Australian workers.

They are high skilled jobs, and they do not care. It is more important to have a relationship with Tony Abbott than it is to have high skilled jobs in this state. What the workers down at ASC need to see is that somehow the state opposition on that side of the house believes that their little sectional interest is more important than the economy in this state, that it is more important than advanced manufacturing in this state, and that it is more important than jobs and high paying jobs in this state.

There is a lot of work that needs to go on around defence, and we are working our way through that, as you would know. It is not just a matter of building things; there are a whole lot of things behind it, such as skills. We are particularly pleased with our efforts relating to skills in the industry-led South Australian Defence Industry Workforce Action Plan; the Science and Technology Mathematics Strategy; the Skills for All initiative, making skills training more affordable with better access, skills that will be important when we build those submarines here in South Australia at some point; and the 133 defence-related honours scholarships, getting engineering and naval architecture going and all those things that are important in the whole cross-section of skills.

There is the Maritime Skills Centre, a designated maritime high school at Le Fevre High School, and other workforce development initiatives specifically related to the air warfare destroyer program. This government has set out, from a very early point in its history, to bring the defence industries into South Australia, and has been successful at doing so to the point where 30 per cent of the defence workforce in Australia is located here in South Australia. What that needs is a commitment from the opposition, not the amendment of motions. What it needs is a commitment to take on all comers in the interest of workers in this state, and that includes Tony Abbott.

The opposition has to take on Tony Abbott to get a commitment to build them in South Australia, not because it is the right thing to do politically but because it is the right thing to do for the state. That is what we do not see on that side: the right thing by the state. We see a lot of Liberal Party sectional interests, and we see a lot of relationship repair and maintenance, but we do not see a party interested in taking on the federal opposition for the good of the state.

Mrs VLAHOS (Taylor) (12:10): Today I would like to speak more calmly on the facts about how this affects my electorate in the northern suburbs around Taylor, and I am rising to support the motion. The Future Submarine project and its continued development in South Australia is the biggest show in town and the most important, and it is a sorry day when we cannot have bipartisan support for a motion that supports the development of this—

Mr Marshall interjecting:

Mrs VLAHOS: No, I am not supporting what the Leader of the Opposition is saying: I am saying it is a sorry state of affairs when both major political parties cannot put the nation's interest, and South Australia's interests—the members of the federal opposition are not defending their state's interests—at the heart of this matter.

We all know the value this program adds to our defence capability, as it is a great range: longer-term patrol endurance and increased capability compared to the Collins class submarines that we have had in the past. The members who have spoken before me, including the Premier, have outlined the benefits of this Future Submarine project to the nation's defence capability, and especially the intellectual property base our nation's advanced manufacturing sectors are developing and will grow from these areas.

Together with the increased defence capability of the nation, the program allows South Australia to take the lead in the development of skills and training—something that I need in my electorate, and that the people in my electorate are demanding—together with the protection of our intellectual property base and technological advantage. As previously mentioned, these areas are important for advanced manufacturing, as well as for our maritime ship-building capabilities and the electronic systems that will support these subs in the future.

South Australia has a strong foundation for submarine and shipyard expertise and infrastructure. This program provides yet another opportunity for this nation-building program and investment in our future in this sector. Participation in the Future Submarines program, which is potentially the largest and most complex project in the nation, is not an option: it is a necessity.

Just as the $8 billion air warfare destroyer project had a transformational impact on the South Australian economy and employed almost a thousand skilled South Australians, so too can this Future Submarine program. These benefits place South Australia at the forefront of the commonwealth defence structure and industry and ensures that the people of South Australia, particularly my people in Taylor, are provided with the vital opportunities they need to participate in work-life balance and a national initiative.

These opportunities truly resonate with the working families in my electorate—those for whom the prospect of an Adelaide-based defence industry means even more benefit for the wider economy and their community. These opportunities mean vital employment and training opportunities for them and their children—children who we want to go into the defence industries, like the young woman apprentice at the AWD keel laying who was working at the AWD alongside her father, an experienced tradesman. The high-skilled, high-paid jobs that these areas provide are important for our state's future; not just economically but socially, with social capital.

For over a year, I have had the opportunity to serve as Parliamentary Secretary to the Premier and I have directly assisted with the state's defence industry. It is an area that I am passionate about. Together with the Minister for Defence Industries (Hon. Jack Snelling), I have also been able to build on the state's reputation as the 'defence state', and have continued a long and valuable dialogue with those in the defence industry both nationally and internationally.

From SMEs machining parts for those projects to the programmers providing code to the high-tech equipment that protects our servicemen and women and the sovereignty of our nation and that of our neighbours, we all know how important subs are and why they matter. Yet, the federal opposition MPs prevaricate, dithering and abandoning their state's interests, and it is a shame.

For the hard work of the minister and their staff I have seen direct benefits of our state defence industries on the ground in Taylor and in the north, from the RAAF base and the battalion at Edinburgh, to the facilities at Techport. Despite all the global issues of financial pressures that many economies face, there is still an optimism and enthusiasm for the potential of Adelaide and South Australia as a national defence hub; both nationally and internationally all these people are serious about doing business in our state. We need to communicate to them that we want this project on a national scale, with both sides of government, and the Liberal opposition is not doing that at a federal level and it is a shame.

There is still defence industry confidence, quite rightly, in the reputation of Techport as the country's pre-eminent centre for submarine construction and modification, as well as the repair and full-life maintenance of these projects. Indeed, it is true to say that in the Southern Hemisphere it is a unique facility. Thanks to the commitment of the current federal and state governments, we remain the uncontested home of future submarine projects, and I want to see both parties federally adopt that approach.

There is still the defence industry confidence in subsequent providers and companies supplying our naval programs, as centres of technological advantage and advanced manufacturing for a whole-of-life cycle through this project. Indeed, the member for Waite mentioned the lifetime commitment this will mean for 30 or 35 years, and it is a valid point. However, this progress is put at risk by the federal opposition, which will not commit to South Australia, and a state Opposition which will not condemn them for it.

This is a long-term program with long-term benefits for the people of our state and my electorate. Australia, a small nation when we speak in defence terms, has always been able to control and manage such complex industrial and technological initiatives, and we are a better nation for it. Unlike those opposite, the government and I will continue to fight for the long-term benefits of our state and my community of Taylor in this area. As the opposition will continue, no doubt, to instil doubt and negativity in the South Australian economy, I will stand here and say that am proud to speak in support of this motion for my people in the north and their children.

Dr CLOSE (Port Adelaide) (12:17): I rise today to speak about the enormous benefit that the creation of a robust and sustainable shipbuilding industry could offer the communities of Port Adelaide, the Lefevre Peninsula and surrounding areas. I imagine that all in this chamber are familiar with the long and proud maritime history of the port. The shipbuilding industry was an early cornerstone of the local economy, providing jobs and revenue to the people and businesses of the port.

Henley Fletcher's Shipwrights' Yard flourished in the latter half of the 19th century, first repairing ships and later building them. After Mr Fletcher's death in 1912, the Adelaide Steamship Company, and later its subsidiary, Adelaide Ship Construction Limited, operated on the site. In 1973 the site fell into disuse. Of course it was not much more than a decade later that the Australian Submarine Corporation won the contract to build the Collins class submarines and the ASC facility was established at Osborne. The Collins class submarines are still maintained on site by the ASC.

The Techport Australia precinct is now Australia's premier naval industry hub, a world-class facility assembling the new fleet of Hobart class air warfare destroyers. This $8 billion project is the largest defence contract in Australia. Some 2,000 workers are employed at Techport. Of course not all these workers live locally in the Port Adelaide electorate, but a significant number do. The magnitude and excellence of the precinct means that its presence looms very high in the Port Adelaide community, in both economic and social terms.

In fact, the maritime culture is so much a part of the port's economic and social life that in 2011 the Maritime High School was established within the Le Fevre High School. This program offers a range of study pathways in the field of maritime engineering and, in addition to excellent academic courses, it offers students an impressive array of hands-on work experience in our local maritime industry.

From its early days to the present day, the maritime and shipbuilding industries have been deeply embedded in the culture of the Port Adelaide community. The port certainly has a proven history of success in shipbuilding, as do several other parts of our state. As Ronald Parsons wrote in his 1986 book Southern Passages: a Maritime History of South Australia:

Shipbuilding in South Australia has been a stop-go industry, with periods of progress interrupted by spells of stagnation.

Our government believes that this should not and need not remain the case. There is an opportunity now to secure a stronger and more consistent future for naval shipbuilding in South Australia. The $36 billion Future Submarine project will soon reach the first stage of first-pass approval. The commonwealth's decision to house the Land Based Test Site and the Future Submarine Systems Centre in Adelaide will generate economic benefits for South Australia for many years to come.

However, there are still decisions to be made around the delivery of the Future Submarine project. These decisions are presently in front of the federal government, and they will ultimately be crucial decisions for the future of the shipbuilding industry in South Australia—and for retaining the attendant skills and capabilities that our state has worked hard to develop. If we are able to capture the opportunities of the Future Submarine project for South Australia, if we are able to retain the skills and capabilities that we now possess and expand upon them, then we will distinguish ourselves as a globally prominent centre for naval shipbuilding, and further opportunities for our state will follow.

The decisions in front of the commonwealth are not just decisions around a single defence project but the choice to underpin the growth of a whole new industry in high-tech, high-value naval shipbuilding, in a community where the maritime spirit runs very deep, from our past to our present. Shipbuilding is an ancient craft—nearly as old as humanity itself—and, in its various forms, it has always required highly specialised skills. This is true now more than ever before with the advent of highly advanced modern defence technologies. Once we have developed the skills and capabilities in our workforce to deliver the AWDs, it is crucial that we secure future opportunities in order to retain them.

For the community of Port Adelaide, this is not only an economic imperative but a social one as well. What I want for the port is not only a sustainable and prosperous economic future but also sustainable first-rate industries of which the Port Adelaide community and its workers can feel deeply proud. I want skilled and meaningful jobs for our local workforce. I want to secure a long-term future for these jobs in order to sustain the families in our community who rely on them, and to retain these skills in our local workforce. I want all of this to be realised, not only in stop-and-go bursts, as Ronald Parsons described, but in a sustained way over the long term.

The Future Submarine Project is important to all of South Australia for our shared economic future, but nowhere is it more important than in and around the port. I call upon the commonwealth government and the federal opposition to recognise and honour the proud history of Port Adelaide, as well as the high-level skills and capabilities that our state's workforce now possesses, by choosing Adelaide as the home for all possible work on the future submarines.

Mr SIBBONS (Mitchell) (12:22): I rise in support of the Premier's motion. As we all know, it is very important for our state's economic future that we maintain and grow a diverse range of industries within the state, and it is under this Labor government that we have seen a strong commitment to developing a vibrant, high-tech, high-skilled defence industry precinct in Techport Australia. The announcement late last year that Adelaide would be the site of the multimillion dollar Land Based Test Site for the Future Submarine project was an important step in this state's growing defence technology capabilities.

At this site, a range of testing for submarine systems, including propulsion, energy and drivetrain technologies, will be undertaken. By undertaking such testing at Techport, the technical issues surrounding maintenance of the Collins class should be minimised and the risk of delay and cost pressures with the eventual building of the 12 new submarines will be mitigated by the virtual groundwork.

As I understand it, independent reports have estimated that the cost of the new 12 submarines themselves is about $36 billion. This is one of the most significant technical projects ever undertaken by the defence force and, when the full project goes ahead, it will be the biggest government procurement project in the nation's history. This follows from the $8 billion air warfare destroyer project. The first of these vessels, the Hobart, is under construction in the member for Port Adelaide's seat, and I understand about 800 people are currently employed on the project. The longevity of these defence projects will benefit South Australia for years to come, providing vital job and economic opportunities for our state.

The future submarine program will run over the next 30 years. That is three decades of commitment from the Gillard government for the future of Techport, the South Australian economy and, most importantly, the workers and their families. This is a long-term project, not one that exists for the life of a government. This commitment demonstrates a commitment to this state for years to come, not just until the next election. The establishment of the test site at Techport will help to ensure that we will not see a brain drain in the gap between the air warfare destroyer project and the future submarines. The submarines will follow from the test site which will follow from the air warfare destroyer project, providing a continuity of work in the Techport precinct.

Our government believes in supporting a range of industries. We believe in supporting South Australians and the South Australian economy, but the fact that the federal Coalition will not commit to South Australia in this program is telling. There has been a concern that Tony Abbott's Liberals do not care about South Australia, and that comes down to simple politicking. There are not enough seats in South Australia to bother caring about us. So, while the Gillard government is willing to look at what is best for the project—and that is building the subs and doing the testing here in South Australia—the Liberal-National Coalition stays silent.

Is it that they do not want this trading card off the table? At the moment we can play a guessing game based on their silence. Is it that they do not support the project, they do not support South Australia, they are yet to make up their mind because the polls are yet to tell them what it is they are meant to think, what to say or what to do? Instead, they make vague comments couched in cost-saving rhetoric. They will not commit to building the submarines here; in fact, they will not commit to building them in Australia.

I find it amazing that the alternative government of this country would choose not to invest in Australia. It is a matter of fact that we can purchase some things cheaper, readily made from overseas, but we must ask at what cost—and I will tell you at what cost. It is at the cost of hundreds of Australian jobs. Surely, that is too much to pay.

We see the Liberal-National Coalition fighting for Australian farmers against international deals but not workers of Adelaide's western suburbs. We see them committing billions of dollars to transport upgrades in Sydney's west but not looking to what they might do to sustain the premier defence precinct which happens to be in a state with not a lot of federal seats. I encourage those opposite me today to appeal to their federal colleagues, encourage them to commit to supporting all Australians, not just those Australians who may win them an election.

South Australians deserve to know where they stand before the federal election. We deserve to know if an Abbott government will simply cast us adrift. We need to know prior to 14 September whether Tony Abbott, should he be elected as prime minister, would prefer to see South Australians out of work than support the South Australian economy. The Gillard government has made a commitment the likes of which the community encourage politicians to make regularly—a commitment based not on an election cycle or winning seats but on the best outcome for our state and our country. We are all seeking for this commitment from the Liberal-National Coalition.

Ms CHAPMAN (Bragg—Deputy Leader of the Opposition) (12:29): Much has been said during this debate about the genuineness of the Prime Minister in making a commitment to South Australia. For all of the good reasons that many speakers have outlined, it is important that she make that commitment. Julia Gillard is the current prime minister; she is in charge of the money and the decisions. She has had a number of years now since her appointment to confirm—and, in fact, advance—what commitments had been made by her predecessor, prime minister Rudd, when he was there.

My concern is that, just as occurred with the state government's over spruiking of the Roxby Downs project, they are again making an attempt to have some advanced manufacturing in this state. I am not sure why they call it advanced manufacturing. I think we are floundering at this stage to maintain even manufacturing in this state. In any event, let us assume that we go to another level, that is, some manufacturing being the future of this state, which we wholeheartedly support.

The government, including the current Premier's predecessor, in my view, over-spruiked our contribution to the air warfare destroyer project. Most members, I think, had an opportunity—in the development of the part of the project that we did in South Australia—to visit the site and see the extraordinary work that was being undertaken for South Australia's part of the contract, which was to build the middle third. The other two ends, of course, were built in different states.

The contract provided that we would build the middle piece and then put all three pieces together. That was our part in an $8 billion-odd project, of which we had, I think, just over a $1 billion share of. What that meant was that the other (near) $7 billion had been spent in other parts of Australia. It is interesting that, if one reads the newspapers that cover the other states when these projects were being done, you would think South Australia did not even exist in the contribution that was put into that very important project.

I think the government needs to also understand that around the world trillions of dollars are being spent on defence in the naval shipbuilding arena. Nothing was more clear to me (last week) when I had a meeting with the Indian High Commissioner, who was here from Canberra to have a talk to members of the government and the opposition. He outlined the defence industries in India. I was interested, and I am sure the government would be interested, in any advancement of both skills training and opportunities in the development of our own naval and defence shipbuilding opportunities in South Australia.

He said to me during this meeting that there is an almost insatiable demand in India for defence building, not just of ships but of other equipment that they require for their own domestic purposes, that is, their own consumption of the necessary defence artillery and equipment they need to both protect their country and, as I say, for their own domestic need. He was not interested in outlining to me what opportunity there might be in South Australia for India to in some way utilise South Australia's premier facilities for naval shipbuilding at all.

He was interested in knowing what skills opportunities there were in South Australia to provide the skills for people in India to promote their domestic shipbuilding industry to provide for their opportunities. As I understand it, they import significant equipment and intellectual property parts from the United States, Russia and Israel and they do the work in India. We might hope, I would think, if there is going to be some continued link with India that we have enjoyed in the past, and would hope that would be developed, to have the opportunities to assist them in their skills development to facilitate that. But let us be clear, let us live in the real world here, our industry is embryonic and it is important that we secure great opportunities.

We have finished shipbuilding in Whyalla. Under this government, we have finished shipbuilding at Port Adelaide, tragic as that is for the shipbuilding industry. I would support the Premier, under an amended motion by the opposition, to do whatever we can to ensure that the defence industry is promoted in South Australia, in particular with naval shipbuilding. But let us live in the real world, let us understand that what we need here is a commitment from the current Prime Minister, who could sign up today, if she wanted to, to make that commitment, but she has not done that. We are moving toward it or some other piffle that we have had.

So, to me, that is not the issue. The issue is making sure that we understand that, in the embryonic aspect of the industry that we have with ASC here, which is a wholly-owned commonwealth entity based in South Australia, we have opportunities. It is important, as other members have illustrated for their electorate, for job opportunities. It is important for South Australia, but understand that, in the real world, we are small in the scheme of things, but we need to ensure that we secure from our own federal government what opportunities we have. Do not over-spruik it; actually just go to Canberra and secure it.

Mr PEGLER (Mount Gambier) (12:35): I would just like to say what a sad, sad day it is for South Australia when both the Labor government and the Liberal opposition have to politicise such an important issue as the Future Submarine project in South Australia. There is no doubt that this project will be the backbone of manufacturing in the future in South Australia and we should also be looking at the opportunities for some of our manufacturers within the regions to be able to piggyback on this extremely important project. I found it quite sad that both the Premier and the Leader of the Opposition chose to spend most of their 20 minutes speaking on how the other side got it wrong rather than a way forward. It is so important that as a parliament we do find a way forward in this extremely important project.

I would call on both the Labor government and the Liberal opposition to come together in a bipartisan way. I know that may be a little naive of me, but that is certainly what I would like to see. I would ask both parties to approach their federal colleagues—both the Gillard Labor government and the Tony Abbott-led Liberal-National Party Coalition—to try to get a strong commitment from both those parties that in the future they will make sure that those submarines are built here in Adelaide at the Techport facility.

I just indicate that I will not be supporting the amendment. I believe that, if the amendment became the motion, the motion would then have no substance whatsoever because all it will do is recognise South Australia's strong commitment, but it gives no commitment to South Australia on where we would go forward. I will support the motion, because I believe that it is a small step in the right direction in calling on the Liberal-National Party Coalition to give some commitment, but we also need much more firm commitment from the Gillard government. I will be supporting the motion.

The Hon. J.W. WEATHERILL (Cheltenham—Premier, Treasurer, Minister for State Development, Minister for the Public Sector, Minister for the Arts) (12:38): I thank all members for their contributions. I think much has been said about politicising this debate. I take members to the actual motion, and it is a purely factual set of propositions. It simply calls for one thing and one thing only from this house, and that is that they call on the Liberal-National Party Coalition to essentially support an Australian build.

That is the extent of what we are asking them to do. We are not asking them to condemn the Abbott opposition. We are not asking them to do anything of the sort. We would like to think that they might go out and actually advocate for this matter. We would like to think that they are behind the scenes using every conceivable endeavour to actually bring this about, but all we are formally asking them to do today is to put on the public record something which calls on them to commit to an Australian build.

I think there has been some misrepresentation of the position of the federal government. The federal government's position, as you would expect with the largest procurement in the history of the commonwealth, is methodical. First they had to ensure that they resolved the problems with Collins so that they could satisfy on any reasonable basis the fact that ASC would be the appropriate place to be involved in the assembly of a new submarine. It made sense for them to get that right first. It also made sense for them to go about this very long and detailed process, that has a number of different passes in it, associated with this procurement process. This is the methodical way in which you actually make decisions of this magnitude.

In any event, we still have Collins until the end of a very considerable period into the 2020s. So this is a project which is for the end of the period, and there is some suggestion that Collins actually has a life beyond its original forecast life. So there is time, but there is urgency about the decision-making processes being stepped out in the way in which they have been proposed. It has also been suggested that, somehow, the federal government has cast doubt on this commitment for an Australian build, and I think that Stephen Smith, the federal Minister for Defence, has been misrepresented by the Leader of the Opposition. He said these words, in addition to the other words that, I think, may have been quoted by him:

And we committed ourselves in 2009 to a submarine fleet of 12 to be assembled in Adelaide. That remains our absolute commitment.

It is not a commitment which is matched by our political opponents, but we have committed ourselves to that, for national security reasons, and we believe they should be assembled here, whichever option we choose, because this is the heart and the home of our submarine expertise.

The Deputy Leader of the Opposition spoke about the 'real world'. I want to talk about the real world. The real world is this: if both major parties at a national level commit to the assembly of future submarines in Adelaide, it happens. That is the real world.

I give you another real world situation: we have a federal election on 15 September and this is the ideal opportunity for this parliament, and those opposite, to put pressure on the federal Coalition to match that commitment. That means we cannot lose either way; that means that South Australia wins, whatever the result of the federal election. That is real world and that is no less and no more than what we are asking with this resolution. The resolution simply calls upon this house to give an expression of intent, calling on the federal Liberal-National Party Coalition to support this.

I know those opposite choke whenever they feel as though they have to say something which may be seen as some veiled criticism of their federal colleagues. I think they are going to have to get over that in the interests of the state. They did that over the River Murray, they wanted us to accept 2,750 gigalitres on the River Murray—we refused to accept that—and we stood up for 3,200 gigalitres of water coming down the river, and we won because we fought. One of the reasons we were successful is that this state—

Mr Pederick: You committed to cutting $14 million per annum.

The Hon. J.W. WEATHERILL: —this state actually stood together—

Mr Pederick: Outrageous!

The Hon. J.W. WEATHERILL: We stood together, and that is what we are asking people to do now.

The SPEAKER: I call the member for Hammond to order!

The Hon. J.W. WEATHERILL: That is what we are asking South Australians to do today: expressed through their elected representatives, is stand together and call on the federal Coalition to match the federal government's commitment to assembling these submarines here in Adelaide. I do not know what the hesitation is by those opposite. I must say I am flabbergasted that they are opposing this resolution by suggesting there should be an amendment to it. I will be staggered if they vote against this resolution.

This will not be a good thing for South Australia, because the important thing about this, if we can lock in this commitment, is the process, the time that it will take, then, to actually move to the various decisions about the models. What will happen is companies will take this as an indication. They will actually see that it does not matter that these actual construction projects maybe 10 or 15 years in the future; you will have defence contractors that will say, 'We want a piece of this action; we want to be in Techport.' Defence companies here in South Australia have done this on spec, even before we have won certain contracts on the strength of the fact that we are going for them.

Mr Marshall: How good are they?

The Hon. J.W. WEATHERILL: Very good. Ask SAGE Automation, they are going very well. People are winning contracts here, not just in South Australia, but around the nation because they punted on the fact that the South Australian government had a clear vision, was making its own investments, and that is translated into defence contracts. How much more powerful would it be if we had the bipartisan commitment of both federal parties. We would then be in a position to know exactly where we stood into the future. There will be a massive temptation, should the federal Coalition be elected at the next election, for them to look at the largest single procurement on their books and seek to make economies. We have seen what Joe Hockey has said. It is natural; of course you would. This is an opportunity for us as a parliament to work together to ensure that this commitment is in place. I commend the motion to the house.

Amendment negatived; motion carried.

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