Minister for Defence - Doorstop - DSTO Edinburgh

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Senator the Hon David Johnston

Minister for Defence

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4 July 2014

QUESTION: I notice this morning you started talking about the possibility of a rolling build for the Future Frigates, does that mean industry is very keen on it?

JOHNSTON: An enterprise, that is that we get a planned acquisition of not just Future Frigates, but many Navy ships if we can be cost-effective.

That’s the thing that industry really wants, that’s the thing that the skillset required really needs, some consistency of long term planning in naval shipbuilding.

If we can achieve that a lot of the problems we’ve had with stopping and starting submarines and frigates will evaporate, as seen in the UK and the USA. They don’t stop building, they come up with another plan, another design that they move to, that’s the secret.

QUESTION: So one at a time is the future?

JOHNSTON: I think one at a time, but block building is the way we’ve gone forward and accordingly it remains to be seen what technological systems come out of places like South Korea, from Europe and from North America as to the most successful way of going forward.

What we’ve learned – or should have learned – is that when you bookend a programme and then want to restart after several years you confront a lot of difficulty, and that’s what we’re confronting with Air Warfare Destroyer.

QUESTION:So you might wind up with submarine or ship six, seven, eight, ten, twelve, whatever in a series, might actually be quite different from number one?

JOHNSTON: That certainly is what we’re seeing overseas, and we’re seeing cost-effectiveness in that.

QUESTION: So it would evolve?

JOHNSTON: Yes, and you have your design team moving from design to evolutionary design and on and on in this space, and you can control all the security aspects much better because it’s in-country.

QUESTION: So you stop thinking about twelve at a time and think more in terms of (inaudible)?

JOHNSTON: And that’s what I’ve been saying, we want an enterprise, we don’t want to bookend a programme because by bookending we end up with this stop-start structure and that’s what’s been fatal to us and to industry because you naturally will have a contraction at the end commonly called ‘the valley of death’.

QUESTION: Have you learned on the subject from your trips to Japan? The Japanese do this very well don’t they?

JOHNSTON: More particularly I’ve learned from trips to the UK. The starting up of the Astute-class submarine programme by BAE, the lesson they learned and underlined to me was ‘we would probably not be able to do it again because it was so difficult in terms of cost and schedule’.

QUESTION: Will you be talking to Shinz? Abe about the S?ry? while he’s in Australia?

JOHNSTON: Well I’ll be talking to him about how much he’s enjoying his trip to Australia; I’m sure the Prime Minister and he will have a lot of deep discussions.

He’s a great friend of Australia, I’m really looking forward to seeing him here next week and we’ll be rolling out the red carpet and extending the hand of friendship as we are renowned to always do with a head of state from a good friend to us, as Japan has been.

QUESTION: But is it on the agenda if you have time with him?

JOHNSTON: Well the Defense Minister and I talk about these often and as much as we need to, and I think that’s all going very well, but they’re not the only people we’re talking to about – particularly – submarines.

We’re talking to the French, we’re talking to the Germans, we’re talking to the Brits and we’re talking to the United States. We’re talking to a lot of people about our Future Submarine programme.

QUESTION: Which one’s winning?

JOHNSTON: Well there’s no winners and there’s no losers. We’re looking to get the best capability we can for the best price we can.

QUESTION: Are you able to provide any more details on the death of the Lance Corporal in Afghanistan?

JOHNSTON: No I’m not.

QUESTION: What was your response?

JOHNSTON: I’m terribly sad for the loss of another Australian soldier – that makes 41 in Afghanistan – and I have spoken to his mother and his brother today.

This is always the downside of dealing with good people, they put their lives at risk for us, they’re on the front line and every now and then something like this happens.

Defence and I personally are determined to do everything we can to support the family, nothing is too much for us in that regard as we get them through the shock of losing their loved one.

Todd was a fantastic commando, he was a great soldier and he is an enormous loss to the nation.

QUESTION: The remaining troops in Afghanistan, are there sufficient safeguards in place to protect their wellbeing?

JOHNSTON: I believe there are and the facts of what has happened here are not clear yet, we are still conducting enquiries so I have no reason to think there are any systemic issues there.

The safety of our people is absolutely at the forefront of my mind, the CDF’s mind, and the service chiefs’ minds.

This is the issue we grapple with every day of our lives, to make sure that our people have the survivability and the safety around them that we must give them, and we try hard to do that.

QUESTION: We heard the Elvis this morning and-

JOHNSTON: Loved Elvis.

QUESTION: Loved Elvis, I’m glad to hear it! -and he echoed the sentiment of many in the industry which was disappointment that they won’t have a chance to tender for the supply ships.

Why did you rule them out, particularly ASC in South Australia?

JOHNSTON: HMAS Success is our replenishment ship, it was built and commissioned in 1986.

Now we’ve had a lot of trouble with it, its reliability has been questioned. We actually had to bring the Spanish out last year for $10 million with SPS Cantabria their replenishment ship to service our needs.

We’ve been in a bad way and we should have done something about replenishment ships about four or five years ago, but we did not.

So we are in a situation where we urgently need two large replenishment ships – for fuel, for aviation fuel for munitions and for provisions and supplies – and those ships must be able to replenish the LHD, the Air Warfare Destroyer, our frigates and other ships in our service.

This is urgent. It’s not something that I can invest a lot of money in infrastructure.

20,000 tonnes or 26,000 tonnes which the two competitors are offering, there is virtually not anywhere in Australia – with LHD’s being built in Adelaide – that we can build a ship of that magnitude without investing a lot more millions and potentially billions in infrastructure.

We’ve got to get on with it. We’ve got to solve the problem that’s been bequeathed to us by the previous Government and accordingly we’ve said we’ll have a competition between the Spanish, who have designed most of our ships, and the South Koreans who have a great reputation for building quickly and well.

So we’re going to have contest and that’s all about value for taxpayer’s money.

QUESTION: So it wasn’t about ASC not being up to the job?

JOHNSTON: No, it’s not about anybody not being up to the job, it’s about time and it’s about space.

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