5 May 2023
Subjects: Multi-Ammunition Soft-Kill System, increased protection from missile attack for navy vessels, defence jobs, Defence Strategic Review, Pacific budget speculation, Vanuatu security agreement, infantry fighting vehicles, missile types, exports, local manufacturing
MINISTER FOR DEFENCE INDUSTRY, PAT CONROY: Today is a great day for Rheinmetall Australia. It's also a great day for the Australian Defence Force and the national security of our country. Today, as part of the Albanese Labor Government's continuing efforts to improve and provide the best equipment for the Australian Defence Force, I'm announcing a $180 million contract with Rheinmetall to build the Multi-Ammunition Soft-Kill System, or MASS as it's known. This is a critical upgrade for the Royal Australian Navy's frigates and destroyers to increase their protection.
This is part of the recommendations from the Defence Strategic Review to really invest in the Army, Navy and Air Force of the Australian Defence Force, to give us the best capability in an environment where our strategic circumstances are deteriorating, and we've lost the 10 year warning horizon.
So today, this $180 million contract, which is over five years, is to equip the Royal Australian Navy's destroyers and frigates with the Multi-Ammunition Soft-Kill System. In crude terms, this is about installing launchers to deploy chaff, aluminium foil metal foil, smoke and flares to protect our ships should they come under missile attack. So this is all about helping our Navy, in the tasks they're required. This contract will add around 45 jobs to the Centre of Excellence we've already got here. That’s 45 jobs on top of the 700 jobs already here, high paid, high skilled jobs for Queenslanders, helping protect our country. Queensland is at the heart of our defence of the nation. Around 27,000 ADF personnel are based in Queensland, around $5 billion of Defence expenditure goes into the Queensland economy each year. And we made a number of announcements around the Defence Strategic Review last week, which will only boost that particularly our investment in hardening our northern bases, including Lavarack Barracks, HMAS Cairns and RAAF Townsville. So this is yet again another investment by the Albanese Labor government, in the defence of the nation and good paying local jobs $180 million to deliver the best possible defensive equipment for the Royal Australian Navy.
RHEINMETALL DEFENCE AUSTRALIA MANAGING DIRECTOR, NATHAN POYNER: Thank you, Minister Conroy. Once again, I'd really like to thank our own team here and the Commonwealth team for being able to get us to this point, very proud moment for us to sign our first contract with the Royal Australian Navy. And once again, I think you can see this as an example of bringing advanced technology into Australia and for the Australian Defence Force, where we can have our local workers now building and assembling and delivering equipment to protect our Commonwealth soldiers. So very proud moment for us. As the Minister said, we have an increase with this technology of more advanced manufacturing jobs for Australia, and bring a new technology edge in for our Royal Australian Navy. So very proud day for the company. And once again, thanks for our team for getting us to this point, and thanks to the Commonwealth team as well for being able to bring this capability into the Navy. Thank you.
JOURNALIST: Can you speak to China's presence in the Pacific at the moment and whether this was a catalyst for the technology to be built?
CONROY: Well, it was made very clear, as the Defence Strategic Review has made clear - that we face the greatest military build-up in our region since 1945. When you couple that with the loss of the 10 year warning horizon for any regional conflict, it means that the Albanese Labor Government is investing more and more into the Australian Defence Force –
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… This area uses advanced manufacturing - 45 high skill, high wage jobs going into Brisbane - because you’re a Centre of Excellence for defence manufacturing.
JOURNALIST: When will the first ships have this technology?
CONROY: Well, we're hoping to deploy very soon. One of the strengths of this system is that it's already in service in other countries. And in fact, we did trials with the Royal New Zealand Navy, very recently, so we're confident, and it's in the Canadian Navy as well. So we're confident we can get this up as soon as possible in the next couple of years
JOURNALIST: Why is the government setting aside hundreds of millions of dollars in a negative budget for the Pacific? Is it again the rise of China in the area?
CONROY: I'm not going to comment on budget speculation. I haven't seen the full details of that story. But what I can say is the Australian Government is truly committed to using every element of statecraft to improve our relationship with the Pacific. That includes investing in more Official Development Assistance, it includes taking action on climate change. The Pacific Australia Labour Mobility scheme is critical for that, as is our Defence cooperation. The ADF are great ambassadors for us in the region, as is our people to people connections, such as sport. So we're using all of that to rebuild and strengthen our relationships with the Pacific. We're part of the Pacific family, they're our closest neighbours. Papua New Guinea is only four kilometres from Australia. So we need to have very good relations with them and that’s what the Australian Government is committed to doing.
JOURNALIST: If we are seeing the military build-up now, is the next couple of years soon enough?
CONROY: Well, as I said, there is an existing protection system on the Royal Australian Navy, frigates and destroyers, and we're upgrading it as part of this process. And we're starting manufacturing as soon as possible to install that on those ships.
JOURNALIST: Minister the fact that it's already installed the New Zealand's Navy, Canadian Navy, now us, have we dragged the train a little bit here?
CONROY: I think that's probably unfair, each Navy goes through upgrade cycles for their vessels. This was the right time for our vessels to get it, and that's why they're getting it now. And obviously, one of the advantages of not being the first type is obviously, we're very confident this proven technology, and it can happen as soon as possible.
JOURNALIST: Back to budget question, are you able say what the spending will actually entail?
CONROY: I'm not going to comment on budget speculation. I'm not the Treasurer. But what I can say is the record of the Albanese Labor Government on the Pacific is very strong. We are committed to rebuilding those relationships. We have something like 36,000 Pacific islanders working in our country right now filling labour shortages, sending money home to their communities and getting great skills. We’re increasing our development assistance. We've got great military and police cooperation. And you can just expect to see that relationship deepening over the years to come.
JOURNALIST: ABC reported this morning that senior Ministers in Vanuatu are pushing back against the security treaty signed last year, and they're pushing it to be either delayed or amended. Are you concerned about that? Are you confident that you can crack it through in its current form?
CONROY: I'm not aware of that report. But I was only in Vanuatu, something like three weeks ago and I had some very good meetings with the Prime Minister, the Foreign Minister and the Treasurer. And the relationship is at a really good strong point. And as evidenced by the fact that we really supported them as they covered from those two tragic cyclones that hid them in only a space of 48 hours. So we've got a good relationship. I was there for when the bilateral security agreement was signed between Prime Minister Kalsakau and Foreign Minister Wong in December last year, and it's working its way through the normal processes.
JOURNALIST: On Land 400 3, have both companies, Rheinmetall and Hanwha, been asked to resubmit bids for prices of 129 vehicles as opposed to 450?
CONROY: That process is starting very shortly. This was an important recommendation from the Defence Strategic Review, which was the need to reshape the Australian Army. We need to invest in its littoral manoeuvre capability. So that means its ability to move at the intersection between sea and land. And unfortunately the DSR recommended, to free up the resources for that project, was to reduce the scope of Land 400 Phase 3 from 450 infantry fighting vehicles to 129. Still an incredibly important capability, providing protection to our soldiers, but using the resources freed up to invest in bringing forward and building more landing craft to actually transport our army assets around the region. And secondly, invest in long range strike. At the moment the Australian Army can only strike 40 kilometres away through its artillery by our rapid investment in long range strike and missile manufacture, they'll be able to strike targets in excess of 500 kilometres. So, the Defence Strategic Review has made that recommendation. We've accepted it, and we're working through the normal tender processes to arrive at a decision.
JOURNALIST: Has the Australian Government spoken to South Korean Government about cancelling the second [INAUDIBLE]?
CONROY: I spoke to my counterpart, the South Korean Minister for Defence Industry before the Defence Strategic Review was made public. That was a courtesy that we extended to both the Republic of Korea regarding the howitzers and Land 400 Phase 3, and also to the German government regarding Land 400.
JOURNALIST: Rheinmetall is famous for its vehicle manufacturer. This construction is very different to a vehicle, is that credit to the negotiation skills of the people involved?
CONROY: Well, I want to publicly thank the fabulously skilled Rheinmetall workforce that are right here now. They are delivering 211 Combat Reconnaissance Vehicles, called the Boxers to the Australian Army and I know the Australian Army, having spoken to some of the people in the cavalry regiments, are very excited to get that capability. I got to go in one, just out there, and not only is that a really skilled piece of equipment that the great Queensland workers right here are delivering, that will increase protection and firepower for the Australian Army, they've their help design and then manufacturing the lance turret, which goes on top of the box. This is the only place in the world where that turret is manufactured. And it's a testament to the skills and ingenuity of the workforce that's in front of me right now. And we're working very hard with Rheinmetall to land a very significant export deal, to export Australian made Boxers with a turret back to Germany. Just think about that if we can land that, an Australian manufactured military vehicle being exported to Germany. And if we land that, that will be the biggest Defence export deal in the history of the country. Long way to go. But negotiations have begun. And we're working very hard in conjunction with Rheinmetall Australia to win that contract.
JOURNALIST: Can you put what this capability will do in simple terms?
CONROY: I am aware there is great people from the Navy here, I am a layman. There is three sort of most common missiles. I'm going to simplify because I'm a politician. They're a heat-seeking missiles, they hone in on heat, you fire flares, which is a heat source, to distract them. We've all seen Top Gun where they fire the flares out the bottom of the, the jet, this, this has that ability. There are radar-guided missiles. So they hone in on a big piece of metal, you fire the aluminium chaff, which is tin foil to distract the radar. There's a third sort that use optical guidance, so they use lasers and things. That's where the smoke comes into play to obscure the target. So there are three ones. I've grossly simplified it, and I apologise for that. But that's how I helped to understand it. Does that make sense?
JOURNALIST: Does this graph all three types?
POYNER: Yes. That's the protective suite and that’s what the Navy use.
JOURNALIST: So if a missile was heading towards a ship, you fire off this? Where does it go? Does it just get a bit confused? Like into the water?
POYNER: Yeah, no, it confuses and disables it. And most of these have a kill switch on them. And then once it has a target and it gets confused, then it will do some classified things around the exact mechanism. But yeah.
JOURNALIST: How quickly will you be geared up to start manufacturing?
POYNER: We'll start the works on the on the site within the next weeks here, and then we'll get the first equipment in. And then we'll be starting to see energising about supply chain in the early part of next year.
JOURNALIST: How different will the system you're trying to create be to the systems already in place from overseas?
POYNER: I think there are 16 countries in total using this and not all of them, we can disclose, I think the Minister mentioned some and I think you'll see this is you know, against those three main types of different guided missiles, you can then defeat all three other systems aren’t quite advance. And then this is the really the technology upgrade that we can bring on to the Royal Australian Navy.
JOURNALIST: Will this be fitted on ships that patrol Pacific or Australian waters?
POYNER: I think that's, unfortunately, also a classified piece of information on exactly which ships and how this system will be deployed.
JOURNALIST: Will there be a plan to not only equip our ships but export as well?
POYNER: Yeah, absolutely. I think you know, reasonably, that's the reason in the facility that you're standing to export the technology and the workforce into the Asia Pacific region. So we can have ability to locally build and then export from here, as the Minister just said, we're working very hard on a Boxer order exactly for that. And that's why we've invested all the technology in the office and the workforce that you can see here in the facility we're standing. As you can see, we're already manufacturing the armoured vehicle program here on Land 400 Ph2 and Land 121. And this will be a great addition to the workforce and manufacturing plant.
JOURNALIST: Pretty exciting that this will be used internationally and it’s been manufactured right here in South East Queensland.
POYNER: Yeah, absolutely. And you know, this is this is one small part of a wide array of technology and manufacturing that you can see here. It's been a long journey. So we started building this facility five years ago, we started our efforts more than 10 years ago with the LAND 121 program. And this is a progressive investment in workforce and technology that we're bringing into the country. And also we've got advanced manufacturing engineering jobs but also engineering. So we've got the ability to start to now with the technology we're bringing in start to also develop our own equipment here and so very exciting for Australia and for South East Queensland as well.