Address to the 2024 ASPI Defence Conference

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The Hon Pat Conroy MP

Minister for Defence Industry

Minister for International Development and the Pacific

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media@defence.gov.au

(02) 6277 7840

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minister.conroy@dfat.gov.au

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4 June 2024

I begin by acknowledging the Ngunnawal people as traditional custodians of the land we are meeting on and recognise any other people or families with connection to the lands of the ACT and region.

I pay my respects to their Elders, past, present and emerging.

I also pay my respects to Aboriginal and Torres Strait Islander men and women who have served our nation in the past and continue to do so today – and indeed to all those who serve in the Australian Defence Force and to our veterans.

I extend a warm welcome to Pål Jonson, Minister for Defence of the Kingdom of Sweden, and to all our international guests.

Members of the Diplomatic Corps.

Members of the Australian Defence Force.

Distinguished guests.

Ladies and Gentlemen.

INTRODUCTION

I’d like to thank ASPI for inviting me to deliver the Keynote Address to the Joining Forces Conference today.

As a Labor Minister, I count as my inheritance and inspiration the great speeches of Labor Leaders past. 

One of them is John Curtin’s speech ahead of the 1943 election. 

Just 20 months into government, with the nation at war, his purpose, he said, was to give to the men and women of Australia “an account of the Government’s trusteeship.”

Curtin’s ideal of a government that acts as trustee of the nation’s defence and security still resonates deeply for us today. 

On coming to Government, the easy thing for us to do would have been simply to tinker at the edges of Defence.

It would have been the easy thing to do, but it would have been the wrong thing to do.  

There was a profound need to go back to Defence’s foundations, to evaluate what we had and what we needed in light of the very real challenges we face.

Our Government identified a need for rational and robust strategy to guide some of the biggest and most consequential investments a nation can make.

And we inherited a void in the Defence Budget, with an over-programmed Integrated Investment Program that was simply inadequate to fund the commitments that had been made.

The independent Defence Strategic Review revealed that the Defence budget had reached historic high levels of over-programming as the former Government reduced planned Defence funding while announcing $42 billion in additional spending without funding.

In this context, the DSR and National Defence Strategy, along with the rebuilt Integrated Investment Program and the Defence Industry Development Strategy, represent strong, foundational thinking on Defence.

And the Budget handed down last month guarantees the funding that will build the Australian Defence Force (ADF) we need, both over the forward estimates and into the years beyond.

The Budget delivered an additional $5.7 billion over the next four years and $50.3 billion over the decade – resulting in a total of $330 billion in allocated funding over the decade to deliver the capabilities identified in the 2024 Integrated Investment Program.

With this Budget, the Government has acted as a trustee of the present and future of the nation’s defence.

We have adopted an affordable, achievable and sustainable plan which delivers the capabilities, jobs and investment in Australian industry needed to support our Defence Force and safeguard Australia’s security.

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One of the reasons Curtin’s 1943 speech resonates so strongly with me is he spoke directly with the Australian people right from the beginning about how the Government was re-shaping what we would call the nation’s defence industry.

There are shades of the Curtin government’s determination and purpose in the Albanese Government’s commitments in Defence, which will rebuild the sovereign defence industry that is critical for our national security.

A strong commitment to our own sovereign defence industry is essential to the Government’s plan to deliver an integrated, focused defence force designed to address the nation’s most significant strategic risks.

JOINING FORCES WITH DEFENCE INDUSTRY

“Joining Forces” is the theme of this Conference, and we see ourselves as joining forces with industry – because that is the only way we are going to get the capabilities we need into the hands of ADF personnel in the timeframes our strategic circumstances require.

We have to sustain and grow the sovereign defence industrial base we need, much faster than we have before.

Defence industry lies at the intersection of economic, industrial and security policy. 

This year’s Budget papers estimate that Defence will spend more than $33 billion on capability acquisition and sustainment in 2024-25.

This is a record level of investment – and most of this will be spent with Australian industry.

And that’s great news for the workers in the more than 100,000 jobs that are supported by Defence industry.

The first and essential purpose of the reforms outlined in the Defence Industry Development Strategy is to strengthen our national security.

But given the size and scope of Defence’s footprint in the national economy, reform to Defence procurement benefits the broader industrial economy.

We are delivering procurement reform to reduce the time and cost of doing business with Defence, enabling rapid delivery of capability into the hands of the ADF. 

And through the new partnerships we have forged with the states and territories, industry and unions, we will have a truly national, targeted and coordinated approach to skills development and growing the defence industry workforce.

For this reason, the Defence Industry Development Strategy is integrated into the Government’s overall vision for rebuilding Australia’s industrial base.  

Building the sovereign defence industrial base we need has to be swift and it has to be effective, so it has to be targeted to areas of strategic priority.

That means Defence will become a much more active partner with industry, supporting businesses to increase their scale and competitiveness to enable them to deliver the Sovereign Defence Industrial Priorities. 

The Sovereign Defence Industrial Priorities lock both Defence and industry into focussing on the outcomes that matter the most.

This approach will also move Australian businesses up the value chain, and lay the foundation for Australian businesses to be embedded into global supply chains. 

STRENGTHENING OUR INTERNATIONAL PARTNERSHIPS

Close industrial collaboration with trusted international partners goes to the heart of our shared strategic interests, making both partners less vulnerable to coercion, enhancing interoperability and accelerating technology development. 

Where we have willing partners, this Government is seizing the opportunities.  

Last year, our indispensable partnership with Japan delivered a first-of-its-kind collaboration between the Australian Department of Defence, Mitsubishi Electric Australia and Mitsubishi Electric Corporation.

A collaboration on cutting-edge laser technology to enhance the ADF’s surveillance capability and survivability of defence platforms. 

This year, the Albanese Government entered into the single largest defence export deal in Australia’s history, to supply over 100 Australian-made Boxer vehicles to Germany.

This contract is valued at 1.9 billion Euros – that is $3.1 billion Australian dollars going into our economy, securing more than 600 jobs in Queensland alone. 

This is a testament to the Government’s strong relationship with our international partners, sharing industrial ingenuity as we face the most challenging strategic environment since the Second World War. 

One of Australia’s most important international partnerships is AUKUS, and I acknowledge ASPI’s work in support of AUKUS.

What has already been achieved on industrial collaboration under AUKUS is remarkable.

The United States’ 2024 National Defense Authorization Act for Fiscal Year 2024 represents the biggest reform to export controls in decades. 

It establishes a national exemption for Australia from US export control licencing requirements, a significant step towards a trilateral export licence-free environment.

This in turn allows the US to share sensitive technology with Australia, with the corresponding cooperation and integration strengthening both our industrial bases.

Australia has also done our share of the heavy lifting on this side of the Pacific.

The Defence Trade Controls Amendment Act passed by the Australian Parliament last year is landmark legislation.

It provides a reciprocal national exemption for the US and UK, removing red tape, and allowing us to more closely integrate our defence industrial base with our partners.

These reforms will deliver an estimated $614 million in benefits for Australian industry over the next 10 years through reduced red tape and faster processing of defence trade permits.

A licence-free environment will deliver further benefits by improving the competitiveness of Australian industry and opening up new business, investment and collaboration opportunities in the US and the UK.

Not to mention the national security benefits of stronger strategic relations and industrial collaboration between Australia, the US and the UK.

And we have delivered the Budget funding to continue to implement these reforms with $28 million dollars over four years, including support for industry engagement and delivering an efficient processing system within Defence.

Along with the Safeguarding Australia’s Military Secrets Act 2024, the Defence Trade Controls Amendment Act also provides strong and robust protection of our national security. 

These significant reforms represent a critical step towards improving our industrial base collaboration.

We will continue to look closely at ways we can collaborate with our AUKUS partners to diversify our supply chains and strengthen our industrial resilience in the region. 

DELIVERING AUKUS PILLAR I

The collective efforts that Australia and our partners, the United Kingdom and the United States, are putting into AUKUS are already bearing fruit.

Through the process to acquire a conventionally-armed, nuclear-powered submarine capability for Australia, we have already developed an incredibly close and productive working partnership.

At every level, we are seeing swift and tangible progress.

Three Royal Australian Navy Officers have graduated from the US Navy’s Submarine Officer Basic Course, ready for their assignment to Virginia class submarines, to serve as division officers. 

More than 20 Royal Australian Navy sailors and officers are currently undertaking training in the US and UK nuclear schools. 

And we have Australian industry personnel in US and UK shipyards to grow Australia’s submarine sustainment workforce.

We have now hosted two port visits by US nuclear-powered submarines and the most significant maintenance activity to be conducted on an SSN in Australia, to date, is scheduled to occur in the second half of this year. 

This will see Australian personnel actively supporting the maintenance of a US SSN at HMAS Stirling. 

And on my last visit to the United States, I welcomed the initial purchase order of processed Australian steel by a major US military shipbuilder, marking another milestone in the AUKUS partnership. 

This is just one example of how we are expanding trilateral industrial capacity.

We are creating stronger, more resilient and more integrated supply chains across AUKUS nations that will support submarine production and reduce manufacturing and sustainment backlogs in the decades ahead.

The Australian Submarine Agency has launched the Defence Industry Vendor Qualification Program to help accelerate the qualification of Australian products for entry into the supply chains of our AUKUS partners.

In its initial wave, the program is working with Australian companies to qualify supplies across four product families to meet US supply chain requirements. 

The next wave will expand the program to qualify Australian companies into both the US and UK supply chains – this will commence in the near future.

These efforts will see opportunities for Australian defence industry to partner with the Government to deliver a nuclear-powered submarine capability for Australia.

The opportunities extend from the delivery of the submarine construction yard in Osborne in South Australia to the delivery of infrastructure works at HMAS Stirling in Western Australia; from sustainment of Australia’s Virginia class submarines to building and supporting the operation of the SSN AUKUS submarines.

GUIDED WEAPONS AND EXPLOSIVE ORDNANCE (GWEO)

Another way the Government is joining forces with industry – and with our international partners – is through our actions to strengthen Australia’s munitions stockpiles and uplift the industrial base for domestic manufacture of Guided Weapons and Explosive Ordnance.

Real progress is being made, and very quickly.

Just over 12 months ago, Defence’s GWEO Group did not exist.

In this short time, considerable progress has been made to expand and accelerate the long range strike capabilities of the ADF. 

This includes the $1.3 billion acquisition of Tomahawk cruise missiles for the Navy and the $1.6 billion we are investing in expanding and accelerating the acquisition of the High Mobility Artillery Rocket System for the Army.

In parallel, we have pushed ahead with our plan to improve national resilience through domestic manufacture of GWEO.

We have signed a contract with Lockheed Martin Australia to begin manufacturing Guided Multiple Launch Rocket System (GMLRS) missiles next year.

We are investing $220 million in munitions production at factories in Mulwala and Benalla, boosting their industrial capacity to support future production demands such as 155mm artillery ammunition and BLU-111 aerial bombs.

Through greater industrial base collaboration and diversifying the broader supplier base we create more resilient and robust supply chains. 

We also reduce overreliance on single sources for key materials, systems and components. 

This isn’t just a priority for Australia – this was highlighted as priority in the US National Defense Industrial Strategy released earlier this year.

GWEO is one of the best examples on how this collaboration is being delivered.

At AUSMIN last year, GWEO was an area of focus. 

At that meeting Ministers agreed to a range of activities, including:

  • Exploring opportunities for regional co-development, co-production and co-sustainment.
  • The co-production of GMLRS in Australia by 2025 – which is on track to be achieved.
  • And the transfer of technical data for the 155mm artillery shell in support of future production in Australia.

And in the coming months, Australian industry can expect to see the Government’s blueprint on the next stage of GWEO, backed with a commitment in the rebuilt IIP of $16 to $21 billion over the next decade.

ADVANCED STRATEGIC CAPABILITES ACCELERATOR 

The Advanced Strategic Capabilities Accelerator, created by the Government in response to the Defence Strategic Review, is essential to delivering a pipeline of emerging and disruptive innovation.

ASCA has issued a request for proposals for the first AUKUS Innovation Challenge in Electronic Warfare.

Australia’s challenge will focus on Defence’s ability to leverage electromagnetic spectrum (EMS) technologies and capabilities that provide a competitive advantage to electromagnetic targeting, and those that protect Defence from adversary electromagnetic targeting capabilities.

The creation of ASCA will, I believe, come to be seen as one of the most important Defence reforms of the first term of the Albanese Government.

Globally, Australia has long been recognised for the researchers, scientists and innovators who work inside and outside of Defence, developing cutting-edge military technologies.

But they certainly expressed to me significant frustrations with a defence innovation system that was clunky, slow, and under-funded. 

We needed transformational change capable of turbocharging the pathway from proposal to prototype to production, and capable of working in partnership with our international partners as well as with universities and industry … and that is what ASCA will deliver.  

ASCA is already working on the transformational technologies that will make the ADF a more formidable deterrent, with its Mission Zero – the Ghost Shark, an extra-large autonomous undersea vehicle co-designed by Defence Science and Technology Group, the Royal Australian Navy and Anduril Australia.

There is nothing like the Ghost Shark in the Australian Navy – and there has never been a public-private partnership quite like this one in the history of the Defence enterprise.

As this Conference explores the opportunities for greater private sector engagement with Defence, it is worth highlighting this innovative partnership.

By involving Navy in its design and development right from the very beginning, we are ensuring that not only will the Ghost Shark be Navy-ready, it is designed to help to make the entire fleet a more effective deterrent. 

And it’s important to highlight the speed at which ASCA is working with Anduril and Navy on the Ghost Shark. 

Through this partnership, we saw an idea become a prototype in an incredibly short time.

The Ghost Shark program only started in mid-2022.

The first prototype was delivered one year early, and the first production variant will be delivered by the end of 2025.

Ghost Shark is a clear example of how the Albanese Government is delivering on our commitment to pull innovation through into capability.

It’s also a clear example of how the ASCA is revolutionising the defence innovation sector in Australia.

CONCLUSION

The times we live in call for serious and bold reform in Defence; making it move much faster, in a more focused way, to deliver clear and identified strategic priorities. 

They call for prudent and proper funding to deliver a generational uplift in Defence’s capabilities, according to a coherent, logical and affordable plan. 

They call for closer relationships with industry and researchers and innovators as well as with our allies and partners.

They call for bringing together all the arms of Australia’s national power, to safeguard our security and contribute to regional peace and prosperity for decades to come. 

That is this Government’s unwavering purpose.

I wish you well for your deliberations at this Conference, as you examine ways to bridge national and international boundaries to deliver more joint, collective and effective defence. 

Thank you. 

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