Minister for Defence - Budget 2015: Defence Budget Overview

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The Hon Kevin Andrews MP

Minister for Defence

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12 May 2015

The 2015 Budget is part of the Commonwealth Government’s plan to build a strong, safe and prosperous future for all Australians. The first responsibility of Government is to keep our people safe in an uncertain world.

In the 2015 Budget, the Government will continue to make a significant investment in the safety and security of all Australians.

This Budget continues to deliver on the Government’s commitment to increase Defence spending to two per cent of GDP within a decade and builds on the Government’s promise to provide Defence with a stable and sustainable funding growth path.

This path for growth reverses the damage done by Labor, which ripped $16 billion from Defence, reducing Defence spending as a percentage of GDP to the lowest level since 1938.

The Government will provide Defence with $31.9 billion in financial year 2015-16 and $132.6 billion between 2015-16 and 2018-19. This is an increase of $9.9 billion compared with the four-year estimates announced in the 2014-15 Budget (2014-15 to 2017-18).

The Abbott Government is committed to strengthening the Australian Defence Force through the development of a credible and fully costed 2015 Defence White Paper, ongoing support to Defence operations and an increased investment in Defence capability.

The delivery of the Defence White Paper, along with the Defence Investment Plan (incorporating a Defence Capability Plan) and Defence Industry Policy Statement later this year, will provide the Australian community and defence industry with the clarity and certainty that Labor failed to deliver. We will lay out a clear, fully-funded plan for a strong and secure Australia.

The Government is committed to implementing its First Principles Review of Defence to ensure the department is properly structured and has the right business practices in place to support the Australian Defence Force in the 21st Century. With ongoing reforms, Defence will be able to make better investments and provide better value to taxpayers. Where we can find cost savings, these will be re-invested in the ADF.

Defence Capability Investments

The Government is committed to bolstering our defence capabilities and supporting Australian defence industry.

Labor’s mismanagement led to 119 defence projects being delayed, 43 projects being reduced and eight projects cancelled, risking critical capability gaps. The Australian defence industry shed more than 10 per cent of its workforce because of budget cuts and deferrals, procrastination and lack of opportunity for Australian suppliers.

In the past 12 months, the Government has committed over $5 billion to new Defence capabilities. These projects have included:

• two additional Boeing C-17A Globemaster III aircraft to bolster the Royal Australian Air Force’s existing fleet of six strategic lift aircraft;
• new and improved personal protective equipment for soldiers, including new-generation body armour; and
• state-of-the-art Special Forces vehicles being assembled in Australia.

This is on top of the Government’s decisions to acquire P-8A Poseidon maritime surveillance aircraft, MQ-4C Triton unmanned aircraft, F-35A Joint Strike Fighter and new replenishment vessels for the Royal Australian Navy.

The Government has also announced an investment in the order of $50 billion for Australia’s Future Submarine Programme. This is the largest Defence procurement investment in Australia’s history and we must get it right.

The Government is prepared to invest in the skills and knowledge base of the Australian naval ship building industry, and is prepared to commit to a long-term investment to make sure this important industry enjoys a future in Australia and these critical skills are maintained. Further capability announcements will be made in the Defence White Paper.

Defence Operations Funding

Recent events in Australia, Canada, France and around the world demonstrate the global nature of terrorism. The threat posed by ISIL or Daesh, is reaching out to Australians, as the terrorist incidents here late last year demonstrated.

We cannot allow violent extremism to spread to our shores. Nor can we afford to let it spread further within our region. The deployment of the ADF to Iraq reflects one part of the Government’s steadfast commitment to keeping Australians safe from terrorism and preventing the spread of violent extremism.

The Budget provides additional funding of $752.7 million in 2015 16 and $802.4 million between 2015-16 and 2017-18 to support defence operations. Including previously approved funding, this takes the total operations funding to $910.7 million in 2015-16 and $1,071.8 million between 2015-16 and 2017-18.

A significant portion of this funding will support ADF operations in Iraq. The Government has agreed Operation Okra will be supported by additional funding of $359.8 million in 2015 16 and $381.6 million between 2015-16 and 2017-18. Including previously approved funding, this takes the total funding to $390.8 million in 2015-16 and $418.3 million between 2015-16 and 2017-18.

Defence Force Pay

Recognising the unique nature of military service and the support offered by Defence families, the Chief of the Defence Force, Air Chief Marshal Mark Binskin AC and the Government applied to the Defence Force Remuneration Tribunal, seeking to improve the Defence Force pay offer. Subject to approval by the Tribunal, the decision to increase Defence Force pay to two per cent per annum will be effective from 12 March 2015.

This demonstrates the Abbott Government’s ongoing commitment to our men and women in uniform and their families.

For more information and access to the Portfolio Budget Statement, please visit

Media Contacts:
Brad Rowswell (Minister Andrews’ Office) 0417 917 796
Chloe Petch (Minister Andrews’ Office) 0477 395 356

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