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The Hon Pat Conroy MP
Minister for Defence Industry
14 March 2023
NEIL BREEN: Okay, so the three countries, they made the significant announcement today that it's happening, happening. And we're going to get three to five subs that we can buy the Virginia Class subs off the United States to tide us over. We're still not going to get them for several years. Then we're going to build, over the course of 20 to 30 years, eight subs out of Adelaide. The whole thing will cost between $268 and $368 billion It's the percentage of 0.15, our average GDP over the life of the program. Gee, I thought it would have been more than that, but then again, when you think of that, that's a lot. Pat Conroy is the Federal Minister for Defence Industry. It's a big portfolio. He would have had a busy day. Minister, thanks so much for your time on Brisbane Live.
MINISTER FOR DEFENCE INDUSTRY PAT CONROY: My pleasure.
BREEN: Minister, I think one of the questions today, and I think at this time, right at the moment, cost of living, interest rates, everything's going up, inflation, people's rents are through the roof. People are dissatisfied in Queensland about the waste the Labor Government has done on stupid things like Wellcamp and buying too many RAT tests they had to throw away and blindsided us with $7bn spends on Olympic Games that the public was never asked about. So, along comes the Federal Government and has to tell the public they're going to spend $368bn. I don't think they can see past the dollar figure. I'm not bagging the governments for doing this. I think we have to do it. But is the dollar figure going to be a hard sell for the Federal Government?
CONROY: We've put out there the GDP figure, the 0.15 per cent of GDP, because we think that's a fairer and more accurate representation of the cost of what is a national effort. A national effort to get the most advanced submarines in the world as a key part of increasing the capability of the Australian Defence Force. It's a very large sum of money, but it's a big investment in our national security that will also deliver around 20,000 jobs and help modernise our manufacturing industries. So, yes, it's a big figure. To your earlier point about cost of living, governments have to be able to do both. That's why we've made significant announcements about easing the cost of living pressures through our electricity legislation, making child care cheaper, cutting the cost of medicines. But the first obligation of any national government is to protect its citizens. And that's why we've made this announcement. It's a big day, not just for our defence, but for our national effort. This truly will be the greatest ever industrial undertaking this country has ever attempted. Bigger than the Snowy Mountains Hydro. On par with establishing the auto industry. And it's a big announcement and it's really critical to our nation's future.
BREEN: It is. It is. And I don't want to get bogged down in a finance discussion here because I think we need to understand we have to spend this money, because behind the scenes, Minister, obviously there's things the Australian public can't be told. But, when the United States President has been working closely on this deal and today flies from Washington to San Diego. The United Kingdom Prime Minister, the UK Prime Minister Rishi Sunak flies all the way from London to go to San Diego. Our Prime Minister goes from India to San Diego. The three of them stand there together to talk about this AUKUS deal to make these subs. There's obviously a threat from China, that the nations of the world are worried about that the public doesn't have the full knowledge of. Am I right or wrong?
CONROY: Well, it's certainly true that we face a regional arms race. We're seeing very significant investment by many countries in our region, in their military. And we also face an environment that's becoming increasingly hostile to diesel-powered submarines. And that's why the Albanese Labor Government is making this decision and is making the investment in nuclear-powered, not nuclear-armed submarines to give us the capability to deter foreign aggressors. And you're absolutely right. Obviously, I and other members of the government are privy to classified security briefings, pretty frank about our environment. We've been open with the fact that we face the greatest strategic uncertainty since World War II, and we need to take action to respond to that. And that's why we make this national investment of acquiring a fleet of nuclear-powered submarines.
BREEN: It was a decision that was made before you came to government though. You're just franking a decision that was made by the previous government.
CONROY: The support for the AUKUS announcement was bipartisan and we paid credit to Scott Morrison and Peter Dutton's role in that. We're not denying that, we're not going to play politics on it, but obviously it's our job to deliver it. And one of the big questions that hadn't had an answer when we came to power was how to fill the interim capability gap. The submarines that are being built in Adelaide won't come into service until the early 2040s. The Collins class submarines are retiring from the late 2030s. We had to solve the capability gap by getting a deal done on the Virginia class submarines and that's the price we paid for ten years of chopping and changing on submarine acquisition under the last government.
BREEN: Okay, so the numbers are mind-boggling. I'm less mind boggled by the 368 or whatever the final number is than I am by, how can it take so long to build these subs? Like, okay, I'm 54, we're not going to see one until I'm mid-70s and we'll see the last one long before I've waived goodbye to everybody. And I'm long gone and long dead. Why does it take the better part of half a century to pull this off?
CONROY: Well, the truth is we're basically having to build a nuclear power submarine construction industry from scratch. We're starting right now on building the submarine construction yard at Adelaide to build the submarines and we'll progress to start building the actual submarine by the end of the decade. But we have to build the workforce and the industrial capacity. That's why, for example, we're investing $6 billion over the next four years alone in just upskilling and training Australian workers and building the supply chain to do this. Importantly, 2042 broadly, the early 2040s is as early as we could get an Australian-made submarine into the water.
BREEN: Why didn't we just get them to make them overseas and just sail on over?
CONROY: Well, there's a couple of reasons why we're not going down that path beyond the interim Virginia class. First, the Virginia class finishing the production line in the early 2040s, the US is finishing production of them so there isn't a production line to buy them off other than the interim capability. And secondly, the essence of AUKUS is actually growing the industrial capability of all three countries.
At the end of this period, we want to be in a position where Australia, United States and United Kingdom have moved from three shipyards that can make nuclear-powered submarines, two in America and one in the UK, to four, with the fourth being in Adelaide. That's about contributing to the industrial capacity of all four countries because the United Kingdom and the United States face significant supply chain choke points in their own production. So it's not as if we can go to a showroom and just pick a nuclear submarine off the shelf. We, in the end, have to build them here to grow the capability of all three AUKUS partners. We're doing it in a way that's considered and sensible and structured. For example, our first AUKUS submarine will come on come into the water about half a decade after the first of the British AUKUS submarines. That means that they've taken a lot of the risk around the first of type prototype and that we're coming behind with a submarine that's a bit more proven that a new industry that we are establishing in this country can build. But those 20,000 jobs are tremendously exciting that will come out of this as well. This is the most advanced manufacturing being undertaking in the world today and we're going to be part of it.
BREEN: Well, we can't complain about manufacturing jobs leaving Australia when we're doing a project like this. Minister, can I leave you with one last question?
BREEN: When this was first floated, Brisbane was mentioned as a possibility where we could build these subs and of course, it was always going to go to Adelaide. I'm not going to put on a stink about that. But the amazing thing was these are nuclear subs. Now in my lifetime, people have hung themselves off bridges as part of protests, not hung themselves, killed themselves, but straddled themselves off bridges, right to protest nuclear subs from overseas coming into our waters. Now, not one person in Australia has raised an objection to a nuclear sub being built here and being built here for the rest of time. Is it too much of a leap to suggest that in the future the Australian public is going to accept nuclear power, fullstop?
CONROY: I think that's a leap, and it's a leap for a couple of reasons. One of the key parts of this acquisition decision is that we're getting the reactor sealed and welded shut from the United States and the United Kingdom with all the fuel there for the entire 30 years of the submarine's life. So we don't have to touch the reactor, which is really important. But the base fact about nuclear power for domestic electricity production is that it's just too expensive. Renewable energy may be firmed up with pump hydro and batteries, so not by itself, but with that backup, that means it's available 24/7, is infinitely cheaper than nuclear power. So even if you got past people's safety concerns and people's concerns about having one near them, it's just more expensive than renewable energy made completely reliable. So I think that's the key difference between what we're getting with our nuclear-powered submarines, reactors that are sealed off shut that we don't have to touch them, in a very confined environment under the sea, versus on land, where we've got great options like solar and wind that can produce electricity -
BREEN: One day.
CONROY: - With a nuclear power.
BREEN: Maybe one day. Defence Industry Minister Pat Conroy. Look, thanks so much for your time this afternoon and for your knowledge on the topic. I think it's helped a lot of people understand it a bit better.
CONROY: My pleasure. Have a great afternoon.
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