SKY NEWS INTERVIEW WITH MARISE PAYNE, DEFENCE MINISTER, ABOUT INDONESIA-AUSTRALIA MILITARY TIES.

HELEN DALLEY:  Well joining me live now to discuss our top story this morning is Defence Minister Marise Payne, and we're very pleased that she made time to join us. Marise Payne, thanks for joining us.

MARISE PAYNE: Good morning Helen, how are you?

HELEN DALLEY: I'm well. Now, how serious is this row, this rift with Indonesia's military?

MARISE PAYNE: Well Helen, we've indicated that of course we take the concerns that have been raised with us very seriously. But, given the depth and the breadth of our relationship, whether it's in cyber-security, counter-terrorism, the Bali Process and countless other areas, I think that if we work through this methodically and we deal with the concerns that were raised through the TNI that we'll be able to restore our relationship in Defence activities to where it was relatively easily.

HELEN DALLEY: All right, so you don't actually have any news on that front right now? You haven't been able to restore the relationship so far?

MARISE PAYNE: Well we've been talking with the relevant Indonesian officials, both their Chief of Army and their Chief of the Defence Force equivalent from our side, and doing that since concerns were raised in late November. We indicated that we would institute an inquiry, which the Chief of Army, Lieutenant General Angus Campbell, did. That is close to finalisation and once we have that finalised and we present those results to the Indonesians and talk that through with them, I think that will be the beginning of that process. That said …

HELEN DALLEY: [Interrupts] All right, but that does beg the question that Australia's- you know, we committed to do an investigation into this. That is still ongoing, and yet there is a rift because the Indonesians cancelled cooperation, they suspended the ties.

MARISE PAYNE: Well they have suspended some cooperation, other activities are still occurring. For example, the Chief of the Indonesian Air Force visited Australia just in December, and our co-chair with Indonesia of an ASEAN Defence Ministers Plus Working Group on peacekeeping activities visited Indonesia in late December. So there are a number of things which are still occurring, there are some which have been suspended. They indicated that, out of concern for the issues that they had raised in relation to the training activities in Western Australia, that they would suspend some activities. We knew that was occurring and we are managing the inquiry process now.

HELEN DALLEY: How would you describe what is happening now?

MARISE PAYNE: Well I would describe it as unfortunate; I, in fact, wish that it had not occurred. I think it would be far preferable if these sorts of issues were not a concern between us. But that said, I think the maturity of the relationship, the depth of the relationship means that we will be able to work through this process, and I look forward to, in fact, a positive outcome in due course. I think due course needs to be allowed to run through though, because it is important that process is seen to be observed.

HELEN DALLEY: All right. Would it be fair to say that perhaps the Indonesians felt that due course wasn't happening fast enough? I mean, how did it escalate to this point where they haven't waited for the results of our investigation and they have suspended ties with Australian military cooperation?

MARISE PAYNE: Well I think that is a decision the Indonesians took. Clearly we have been in regular communication from army to army and military to military. I have been in contact with my Defence counterpart in Indonesia, Minister Ryamizard Ryacudu. He's in fact indicated that he intends to visit, at my invitation, Australia indeed in February. So from that perspective we have been communicating regularly. I think though that the concerns that were raised are ones which we have taken seriously, and ones which we are dealing with seriously.

HELEN DALLEY: All right. So how did this all start? The concerns that were raised, were they from, as we understand it, a Kopassus trainer who was in Australia, he took offence at some of the training materials that were saying principally that West Papua was part of Melanesia and really wasn't part of Indonesia, and took great offence at that?

MARISE PAYNE: There are a number of issues which appear to have been raised out of the training program in Western Australia, and they are part of the inquiry process which the Chief of Army is undertaking. I'm not going to prejudge those or canvas the issue. I don't think that's appropriate given we have a military inquiry underway.

HELEN DALLEY: [Talks over] So you know what the issues are, but- sorry, you know what the issues are but you're not going to tell us what the issues are that caused this offence, to cause this suspension of military ties with one of our biggest and nearest neighbours?

MARISE PAYNE: Well some of them have been canvassed in the media as you know …

HELEN DALLEY: [Talks over] So they're true?

MARISE PAYNE: … but I don't think that it helps to re-ventilate those ad nauseam, and I think it is important to allow the inquiry to run its course.

HELEN DALLEY: All right. So you say there were a number of factors. I mean, there are reports that Australia tries to poach Indonesia's best soldiers. I mean, can you say whether that might be the case and that perhaps that really peeved them, but also that there may be concerns at the increased numbers of US troops in the north of Australia?

MARISE PAYNE: I've heard some of those reports this morning, and there is no basis in fact for concerns about poaching – or whatever term one would want to use – of Indonesian soldiers in that regard. I have in fact discussed the marine rotation with my counterpart at a number of meetings in the past and have had no concerns raised with me. The marine rotation is something which we spoke with Indonesia about once the decision-making was finalised, alerted them, advised them of it, and I am comfortable with the understanding between the Indonesian Government and our Government in relation to the marine rotation. We know that our joint efforts across the Indo-Pacific are vital to peace and to stability in this region – that includes Indonesia, it includes Australia, it includes the United States and a number of other parties, and that is a very well-understood aspect of our relationship.

HELEN DALLEY: So Minister, just to be specific and clear, you say the issue of the troops, increased numbers of US Marines in the north of Australia being rotated through has been raised with Indonesia before and they have not raised any concerns with Australia or with you?

MARISE PAYNE: That's right. That was part of the process of consulting across the region. Of course once the decisions were made our neighbours were advised. And let's be clear: the marine rotation has been underway for some years now. It's not a new occurrence and is something which has been very important in the region. In terms of our relationship with Indonesia, we have a very open and frank defence relationship. I have met several times with my counterpart. In fact, after the Defence White Paper was launched in February of last year the two visits that I made immediately after its launch were firstly to Jakarta, secondly to Kuala Lumpur, recognising the importance of both Indonesia and Malaysia in regional terms to us and to our activities more broadly. So these sorts of matters are things which we discuss regularly. The Foreign Minister and I attended a two plus two meeting with our Indonesian counterparts in Bali just at the beginning of November, if I recall correctly last year, a very important meeting with a focus on a number of things: on the Bali Process, on our efforts in cyber-security, and most importantly on our joint efforts in counter-terrorism, and particularly in addressing the challenge of returning foreign fighters from the Middle East, which is one which plagues both Indonesia and Australia as we well know, and one which we take very seriously.

HELEN DALLEY:  Yes, so those sorts of cooperative ties will continue, but who ordered this suspension then? If you say that it's being dealt with at the highest levels, was it- there is talk that it was more a low level reaction, but who ordered the suspension? This is a major change in our relationship, it must have been done at a high level, surely?

MARISE PAYNE: I understand it to have been a direction from the TNI commander, the CDF equivalent – Chief of the Defence Force equivalent – and one which we have been corresponding with Indonesia about since that time. The Chief of Army has an arrangement underway to meet with his counterpart, and once the inquiry is finalised and those matters can be spoken about with Indonesia we'll take it from there.

HELEN DALLEY: All right, and just finally, those planned upcoming shared military operations, what of them now?

MARISE PAYNE: Well I would hope that we can still proceed with those, and we have had preparatory meetings for that, and that's a matter which I'll be working with the ADF on.

HELEN DALLEY: All right, Minister Marise Payne we do thank you for your time and for putting that in some perspective. Appreciate it.

MARISE PAYNE: Thank you very much, Helen.