Doorstop interview with Premier Peter Malinauskas, Osborne shipbuilding facility

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The Hon Richard Marles MP

Deputy Prime Minister

Minister for Defence

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02 6277 7800

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6 July 2022

SUBJECTS: Australian shipbuilding industry; nuclear-powered submarines; Frigates; Skills shortage; Prime Minister representing Australia abroad; Brereton Report.

PETER MALINAUSKAS, PREMIER OF SOUTH AUSTRALIA: Good afternoon, everybody. Thanks for joining us here at Osborne. I'm very glad to be here with the Deputy Prime Minister of Australia, and of course the Minister for Defence, Richard Marles, along with the Minister for Health, Mark Butler, and of course, Mark is the local MP for this extraordinary part of not just our state but our Commonwealth.

I can't tell you how glad I am this morning to have the Deputy Prime Minister, Richard Marles, touring South Australia's extraordinary centrepiece of the shipbuilding industry here in the country. We know that Adelaide is the home to our capability as a nation to build warships. We know that it will be South Australia that produces the frontline of our national security and defence effort for many, many years to come. And to have the Deputy Prime Minister here firsthand today, in one of his first official visits, touring the Osborne facility, I think, bodes well for the future of this industry here in our state. What the Deputy Prime Minister has been able to see firsthand today is the extraordinary capability that South Australia offers when it comes to shipbuilding. This has been something that has now in our blood here in South Australia. We are the home of the Collins-class submarine. We built the AWDs. We now see firsthand the work in terms of the delivery of the Hunter class. And of course this will be the home of the future nuclear submarine program in our nation. To have the affirmation and confirmation of the Albanese Government that Adelaide will be the home of our national shipbuilding effort is something that I think should fill a lot of South Australians with confidence, particularly within the defence sector, to continue to invest in their own capability and technological advancement.

The shipbuilding industry here in South Australia, of course, represents the single biggest investment on behalf of the Commonwealth in the history of our nation. There is no more complex undertaking than building nuclear submarines on the planet, and that is going to be happening right here in Osborne. Make absolutely no mistake, the prospect of South Australia building nuclear submarines represents the biggest opportunities we've had as a state to realise an industrial transformation that will improve the standard of living of all South Australians. To have this many jobs, this many well-paid, secure, highly technical skilled jobs here in South Australia bodes well for our whole state's economy in a way that will provide a lot of benefit to South Australians for generations to come. The thing about these investments is it will improve the standard of living for the next generation of South Australians and the one after that and the one after that. And to have the Deputy Prime Minister here today, confirming the Albanese Government's commitment to this industry, not just with the Hunter-class program but also with the AUKUS nuclear submarines is great news and I very much welcome that.

I would now like for the Deputy Prime Minister to say a few words and then naturally, we're all here to answer any questions that you may have after that.

DEPUTY PRIME MINISTER: Well, thank you, Premier. It's great to be here with Peter Malinauskas, the Premier of South Australia. This is the first press conference we're doing together since both of our elections earlier this year. I cannot really express how good that is at so many levels to be here and doing that with Peter today. And, of course, it's great to be here with my good friend Mark Butler, the Minister for Health, but also the Member for Hindmarsh, the local Member of Parliament for this area.

This is the very first visit that I've done as Minister for Defence in Australia to any site of Defence significance. The reason I'm here is not by accident. This is a critical part of our nation's future. Indeed, Australia's defence starts right here. It starts right here at Osborne. As an island continent so much of our defence capability is based on our maritime capability, and this is the home of our nation's shipbuilding and submarine building industry. And it's been that in the past. As the Premier said this is where the Collins was built, this is where the AWDs were built. One of those is right now — or about to be — on exercise around Hawaii, in the US, Exercise RIMPAC. It is also where the first two of our offshore patrol vessels are being built. Right behind us you'll see what will become HMAS Arafura. And we've also seen the beginnings of the Hunter-class program underway in the magnificent sheds, which have been commissioned literally in the last 18 months. Of course, this is where full-cycle docking happens in respect of our Collins-class submarines, and where the life-of-type extension of our Collins-class submarines will also happen. And it's important to make that point. In terms of our submarine capability in the short to medium term, really for 15 years and more, it's going to be about Collins. And that is all happening right here in terms of full-cycle docking and life-of-type extension.

But as the Premier also said, in terms of AUKUS, what it delivers for Australia — a nuclear-powered submarine – it is fundamentally important to that program that Australia has the capability to build those submarines in our nation and that happens right here at Osborne. And an Albanese Labor Government is committed to that. It's really important to understand how significant that is in the context of AUKUS, because Australia needs to play its part in contributing to the industrial base of all three countries, and the way in which we will get the eight submarines in the quickest possible time is by having that capability to build submarines right here at Osborne. Which is why it's so fantastic to be able to come and inspect what's going on right now, inspect what we will see in the future with the nuclear-powered submarine program and where that will occur. And to understand that right now we see hundreds by thousands of people working at Osborne, but in the future it will be many thousands of highly skilled workers who are going to be building this incredible capability for our country. It is a nation-building effort. It's one of the most important pieces of infrastructure that our country has ever attempted to build and it's very exciting. It is very high-tech and it is very skilful. That's really the final point to make. As a nation, what we must be doing is climbing the technological ladder in terms of our domestic economy. We need to be engaged in high-tech manufacturing, and there is no more high-tech manufacturing that you will get than building submarines, than building frigates, than building offshore patrol vessels that we're seeing right now. So, the future is very bright here for Osborne. It's very bright for South Australia and this is going to make a huge contribution to the security of our nation.

JOURNALIST: Firstly, on the frigates program, that's blown out by billions of dollars and there's concern that it won't actually meet the needs of the Australian Navy. What do you make of the program so far and those concerns?

DEPUTY PRIME MINISTER: The frigates are a really important contribution to our Navy. The Hunter-class frigates will really in many ways be the centrepiece of our surface fleet. We will be working with BAE to make sure that this capability is delivered. It is critically important for the nation that that happens in a timely and effective way, and I do have confidence that that is what will occur.

JOURNALIST: Deputy Prime Minister, you'll be travelling to the US in a few days’ time, what are the main issues surrounding AUKUS that you want to raise with your American counterparts?

DEPUTY PRIME MINISTER: Well, the starting point is that given the complexity of the strategic circumstances that Australia faces today, the alliance with the United States has really been never more important. It is really critical to our world view. It's critical to our national security going forward. So, the starting point is to reaffirm that. But AUKUS and the way in which it will deliver for Australia a highly capable nuclear-powered, long-range submarine is central to building our nation's strategic space. It is the most important platform that we will have in terms of building our strategic space, and I'm very keen to have the conversation with the United States, as in time I'll also be having with the United Kingdom, about how we can make sure that this is happening in as quick a fashion as possible. We do need to remind ourselves that when the former Coalition Government came to power in 2013, it was anticipated that the Collins-class submarines would be being replaced in the middle of this decades, in just a few years’ time. After nine years of the former Government, we're now in a situation where, as it stands, we're not looking at those nuclear-powered submarines coming into plan until the 2040s. We want to look at how we can get them here earlier. We want to obviously be looking at what option we ultimately run with, and we also need to be looking at plugging whatever capability gap arises and looking at the solutions to that. So, there is much to talk about with the United States and I'm very much looking forward to the opportunity of doing that

JOURNALIST: Have you looked at local content specificity within the contract? I think there was talk of 80, 70, and then 60 per cent in the previous project. Is that going to be something that's look at, setting an actual target, and what is that target going to be?

DEPUTY PRIME MINISTER: Yeah sure. It is early days. We are going through a process right now of choosing the actual submarine option and, as I just said, working out then how we can get it as soon as possible and looking at whatever capability gap arises when we understand what that date is. And we want to be able to announce all of that in the early part of next year. But I think the point really to make in answer to your question about Australian industry content is that if we want this capability to happen sooner rather than later, we have to build Australian capability right here. But if we are going to be solely reliant on a capability overseas, then we can expect those submarines are going to take a long time to be in our service and we need them as soon as possible. So, building Australian industrial capability within Australia — and I mean right here at Osborne — is fundamentally important to making sure that we acquire this capability as soon as possible, and that is going to be front and centre in terms of the way in which we are analysing this issue.

JOURNALIST: What were your talks with the workers today who were striking for better conditions and pay rises, given you say it's critical for the nation's future?

DEPUTY PRIME MINISTER: Well, almost exactly that, what you just — the last phrase you just said then. And I really mean it. I think the defence of our nation starts right here. Those who work here at Osborne, those who are building our nation's maritime capability, they are critical workers in terms of our national mission, in terms of building Australia's strategic space, in terms of responding to the complex strategic circumstances that our country faces. They are vitally important in terms of that effort. What I wanted to say to them today was just that – that the nation recognises their service and values it deeply

JOURNALIST: So, you would be encouraging BAE to meet their demands?

DEPUTY PRIME MINISTER: Well, ultimately there is a negotiation around an enterprise agreement which is occurring between the workers, their union, and BAE. That's a process that will play out in the normal way and is playing out in the normal way. I simply make the observation that the value of their work is tremendous in terms of what the nation requires.

JOURNALIST: What will the Federal Government be doing to address the skills shortage that we have here, I suppose, to make sure that this program can be pulled off?

DEPUTY PRIME MINISTER: Yeah, it's a really good question. Skills is going to be a fundamental challenge, but also a fantastic opportunity for the workforce here in South Australia. Actually, I think, in terms of supply chains around the country, this project is going to increase the skills base of the nation, literally. You can put it as highly as that. So, that’s a great opportunity for the country, but you're right to say it's also a really big challenge. And it's a particular challenge again given the last nine years of drift under the Coalition Government, where we saw billions of dollars ripped out of our nation's TAFE system, so that we have far less apprentices and trainees today than we did back in 2013. We really need to reinvest in our skills base. We need to reinvest in our TAFE system. That's part of the policies that we took to the last election and key amongst those was making sure that we are offering free TAFE for people who are studying in areas of skill shortage. That is a critical policy in terms of going forward, but it's going to be really important that we focus on the specific skills that are required, and they are very specific in terms of building our surface fleet and, ultimately, participating in the submarine build as well. And we will be very mindful of making sure that we build that skills base.

JOURNALIST: Just another matter, the Prime Minister has come under fire for being overseas while New South Wales is under water. What would you like to say to that?

DEPUTY PRIME MINISTER: I think the criticism's ridiculous. I mean, it's patently ridiculous. When the Prime Minister left for overseas for what was really an important conference of NATO and its immediate partners - a really important conference in terms of meeting Australia's strategic circumstances - when he then went and visited Ukraine, where there are issues at stake in Ukraine which absolutely engage Australia's national interest. At the time the Prime Minister left, this event wasn't happening. As soon as he was able to make contact with the New South Wales Premier, he did. As soon as he was able to make contact with the Minister for Emergency Management, he did. And he is visiting these sites as soon as possible as well. But I mean, ultimately, you can listen to the New South Wales Premier who has made really clear that he is pleased with the level of cooperation between the New South Wales Government and the Commonwealth and the way in which we've responded in a very proactive way, including through the use of the Defence Force, to this natural disaster.

JOURNALIST: Just on another topic. On Defence culture, does it bother you that Defence was warned years before the allegations of misconduct and war crimes emerged from Afghanistan that there was a culture of silence and not telling the truth within the Special Forces?

DEPUTY PRIME MINISTER: Well, cultural issues obviously are always a concern, and we need to take them very seriously. And the matter that you've referred to, obviously, predated what occurred in Afghanistan, which has then been the subject of the Brereton Inquiry and the Brereton Report. The point to make is this: the vast bulk of those who serve our nation, who wear our nation's uniform, do an astonishing job in terms of representing our country. There is something very significant about the act of wearing that uniform and comprehending the sacrifice that potentially comes with it. What we saw in terms of those incidents that were described in Afghanistan, and indeed the incidents that have been described prior to that, are clearly shameful and it's really important that as a nation we speak to our own values by investigating them, and holding ourselves to account. That is what we are doing. The ultimate answer to making sure that we get culture right in our Defence Force is to completely follow through on all the recommendations of the Brereton Report and that is what we are going to do.



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