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Legislative Council - Fifty-Fourth Parliament, First Session (54-1)
2018-10-17 Daily Xml
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Defence Shipbuilding

The Hon. T.T. NGO (15:53): I rise to address an important issue that has arisen recently in the national media about the building of the newly awarded submarines, which are to be the Shortfin Barracuda designed by the French company DCNS.

The Senate was originally established by our nation's founding fathers as a buffer to be used by smaller states to ensure that the House of Representatives and the majority of its members of parliament from the bigger states could not dominate the national agenda. This is why South Australia has the same number of senators as New South Wales or Victoria. While the establishment of formal political parties has blurred some of these lines, it is fair to say that across the party divide our state's senators try to work in the best interests of South Australia, and multipartisanship is normally reached on issues of strategic importance to our state.

It has been extremely disappointing to learn that we have four senators—Senator Rex Patrick, Senator Stirling Griff, Senator Cory Bernardi and Senator Tim Storer—casting doubt on the awarding of this contract back in 2016. Since then, Australia's defence department and its French counterparts have been working on a strategic partnership agreement. This agreement is to iron out the specific details of the build, including what will happen with the sustainment of the submarines.

Senator Patrick, in particular, through an opinion piece in The Advertiser on 2 October 2018, was vocal in his criticism of this agreement, arguing that for $20 billion Australia could have had 20 submarines off the shelf. What this would do is deny hundreds of South Australians at Techport the work they have been expecting in building the submarines from scratch as opposed to simply attaching a few components onto an already built sub. The arguments about whether to buy off the shelf or go with a new build were already furnished before the awarding of the contract.

Why are these senators raising this issue again to the potential detriment of hundreds or thousands of jobs in South Australia? The four senators have also raised a concern about the overall cost of the project, with reports from the Australian Strategic Policy Institute inflating the total cost to $200 billion. They claim that outside of the $50 billion for the build, another $50 billion will be spent in sustainment and another $100 billion spent in constant dollars.

It is disappointing that we have South Australian senators framing these costs in these terms without considering the long-term economic benefits to South Australia, which come with many years of sustainment at the Osborne shipyards. It has also been made clear on numerous occasions and was again reported by Tory Shepherd in The Advertiser on 3 October that, and I quote:

Extensive investigations and multiple defence experts said there was no off-the-shelf option that would meet Australia's needs, and the modifications needed to get them up to scratch would be so extensive it would be better to get a new submarine.

The Chief Executive Officer of the Defence Teaming Centre, Ms Margot Forster, stated in response to our four senators:

Anything that delays the awarding of contracts and the beginning of the flow of work and jobs and cash is going to be a bad thing.

At the moment, industry is working to a timeline that's been advised by the government to build up their capability to deliver. If that is then delayed it throws all of those plans into chaos and could drive businesses out of business.

With Western Australia clamouring to get more of the sustainment work for the current Collins Class submarines, now is not the time for our senators to be demonstrating any weaknesses out of South Australia to Canberra.

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