TRANSCRIPT: INTERVIEW WITH CHRIS UHLMANN, 7.30 REPORT
TRANSCRIPTION: PROOF COPY E & OE
DATE: 3 MAY 2012
TOPICS: Joint Strike Fighter; Defence Budget; White Paper; Labor Party.
CHRIS UHLMANN: Earlier I was joined by the Defence Minister from Melbourne.
Stephen Smith, welcome.
STEPHEN SMITH: Pleasure, Chris.
CHRIS UHLMANN: Did you delay buying the Joint Strike Fighter because you believe it's in the best interests of Australia or to defend the Government's budget surplus?
STEPHEN SMITH: Well I've been saying for about six months that we had to make sure that so far as acquiring the Joint Strike Fighter was concerned that we didn't have a gap in capability and we'd make a judgment about that by the end of this year. That means do we need to purchase, for example, any more Super Hornets? I've also been saying for some time that this year we'll make a judgment about the precise time when we buy, effectively, our first 12. What I've announced today is that we're putting the purchase of those first 12 on the same timetable effectively as my US counterpart Defence Secretary Leon Panetta did for the United States a couple of months ago when he moved nearly 179 planes onto the same timetable and that's because there have been considerable schedule development and other production delays so far as the fighter is concerned.
CHRIS UHLMANN: Certainly, Minister, but when Leon Panetta did that he might it quite clear that they are cutting US Defence budget by $50 billion a year. Are you cutting the Australian Defence budget?
STEPHEN SMITH: Well, I've made it quite clear that Defence will make a contribution to the Government's budget surplus in the budget next week.
CHRIS UHLMANN: Is it cuts or delays?
STEPHEN SMITH: Well, there will be, frankly, both. There will be savings; there will also be delays so far as capability and procurement projects are concerned. And I've indicated today effectively the largest of those. Moving the purchase of the first 12 Joint Strike Fighters two years down the track has the effect of saving about $1.6 billion in the forward estimates, so that helps the budget, but it's also a sensible Defence, Air Force and national interest decision to do because there have been unanticipated delays in that project and that's a much better time for us to purchase those planes.
CHRIS UHLMANN: But, in the Defence White Paper of 2000, you recommitted yourself to three per cent increase in Defence spending until 2018 - that was a three per cent increase every year until 2018. Are you abandoning that promise?
STEPHEN SMITH: And then after that, a 2.2 per cent increase on average for a further more than 10 years. So it's an on-average increase over a long period of time. Now there's no doubt -
CHRIS UHLMANN: No, it wasn't on average, Minister, it wasn't on average over a long period of time. That language has crept in. Those are the weasel words that have crept in since 2009, aren't they?
STEPHEN SMITH: Well that's not right. It is an on-average three per cent, an on-average 2.2 per cent over effectively a 20-year period. But the real point is this-
CHRIS UHLMANN: It didn't say on average - it didn't say on average in the Defence white paper.
STEPHEN SMITH: Well, let's make this point: there's no doubt that since 2009, as a result of our financial circumstances and the global financial crisis aftermath, that it's been a very difficult time for us. So, we are not anywhere near that average, however you want to describe it. What we've tried to do is to make sure that the core capability set of the Defence White Paper, including Joint Strike Fighters, including Landing Helicopter Docks, Air Warfare Destroyers and the like continue to move through the system and that's what we're doing.
CHRIS UHLMANN: And in 2009 White Paper the Minister's forward said, "The Government has demonstrated the premium it puts on our national security by not allowing the financial impact of the global recession in its budget to affect its commitment to our Defence needs." So if it was good enough to say that then, why isn't it good enough to say that now?
STEPHEN SMITH: And what the White Paper 2009 said in the words of the former Minister was that we hadn't seen the complete unfolding of the global financial crisis. And what we've seen since then - one of the examples you've made - it's not just Australia who is under pressure so far as short and longer term Defence spending is concerned; so is the United States, so is the United Kingdom, and we have seen, as you've put it, deep cuts in both of those areas. What we're trying to do is by carefully looking at our priorities, yes, by some delay in capability in projects and not by cutting things but by reducing the amount of money that goes to them, to put us in a position where we can protect a whole range of Defence activity and when the fiscal position improves, to return those to a more improved state.
CHRIS UHLMANN: But you are still committing 12 to 18 submarines, which is the biggest ticket item that you had in the 2009 Defence White Paper. And you can tell us how many of the six submarines you have at the moment are actually operational?
STEPHEN SMITH: Well of the six Collins Class Submarines, we've got two in deep maintenance in Adelaide, where the Prime Minister and I were today. We've got two in short term or scheduled maintenance in WA. We've got one on operations in an exercise and another about to be deployed. So, that is not an unfamiliar two plus two plus two arrangement so far as submarines is concerned, and yes, we have fully committed ourselves to 12 Future Submarines. We announced the first step today. That's a very important part of our maritime capability. And so, in a difficult financial circumstance, we can do that and at the same time make sure that the budget doesn't adversely impact upon our operations overseas like Afghanistan, the kit we deliver to troops in the field, nor to our military numbers.
CHRIS UHLMANN: Finally Minister, on another issue, do you get any sense from your electorate or from your party that people are despairing of the Labor Party at the moment?
STEPHEN SMITH: Look, we're going through a very tough political time. There's no doubt - there's no point gilding the lily over that - a tough political time. But in difficult circumstances like today we are making important long-term decisions about our national security interests and about national economic interests and sometimes there's a bit of political pain associated with that. But at some point in the cycle, the community will start to take a longer term view about what we've done and also start to make the comparison, the comparison between Tony Abbott and the Liberal Party and Julia Gillard and the Government, and in that comparison I've always been of the view that we will be competitive when the time comes.
CHRIS UHLMANN: Briefly, it's your expectation that the Prime Minister Julia Gillard will be leading you to that election?
STEPHEN SMITH: Yes, it is. We dealt with the leadership issue comprehensively and conclusively a few months ago. I'm not expecting that we'll revisit it. She'll lead us to the next poll, just as I expect Tony Abbott will lead the Liberals to the next poll.
CHRIS UHLMANN: Stephen Smith, thank you.
STEPHEN SMITH: Thanks, Chris. Thanks very much.