Interview with Hamish Macdonald, ABC Radio National

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The Hon Pat Conroy MP

Minister for Defence Industry

Minister for International Development and the Pacific

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(02) 6277 7840

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21 August 2023

SUBJECTS: Labor National Conference, Australia defence acquisitions, Big Four consultancy firms


HAMISH MACDONALD: An arms race is already happening before our eyes. That's what the Minister for Defence Industry, Pat Conroy, told delegates at Labor's National Conference. Since then, the government has announced that more than $3 billion will be spent on long-range missiles, Tomahawks and High Mobility Artillery Rocket Systems, or HIMARS, as they're known, from the United States. All to help boost Australia's military capability in the region. Pat Conroy is with us this morning, good morning to you.

MINISTER FOR DEFENCE INDUSTRY: Morning, Hamish. How are you?

HAMISH MACDONALD: Very well, thanks. If there is an arms race underway, is Australia buying into it with these purchases?

MINISTER FOR DEFENCE INDUSTRY: Well, the critical thing is for us to play our part in contributing to strategic balance. And the way you do that is investing in our military capabilities to deter potential aggression, but also to invest in diplomacy and international efforts through foreign aid. We're doing both.

HAMISH MACDONALD: Is that just another way of saying the same thing?

MINISTER FOR DEFENCE INDUSTRY: No, no. It's saying that when there is a regional arms race, we need to respond to that to ensure that Australia is in a position to protect ourselves and that no country ever thinks conflict is worth it. So, this is about strategic balance, but at the same time complementing it with our diplomatic efforts, our increased engagement in the region, our record investments in foreign aid. They all play complementary roles in promoting peace and stability in our region.

HAMISH MACDONALD: You are announcing the purchase of these 200 Tomahawk long-range missiles. They're high-tech, they can be guided once they're already deployed. They have a range of 1500 kilometres. What do you imagine them doing? What's the capability that we're buying with these?

MINISTER FOR DEFENCE INDUSTRY: Well, these will have the ability to strike, as you said, at a range of 1500 kilometres. We'll only be the third country in the world with this very advanced long-range strike capability. And this is about deterring conflict. This is about placing question marks in any potential adversaries' minds that Australia could respond if challenged. So, this is about peace and stability in our region by deterring conflict. And I know you'll respond and saying, "Well, aren't we just engaging in a military buildup?" But in the end, the only way we pursue peace and stability is by presenting strength, and this is what this is about.

HAMISH MACDONALD: So, how do you imagine these particular weapons changing the calculus for a power like China in the region? What does it do to the dynamics?

MINISTER FOR DEFENCE INDUSTRY: Well, it's about maintaining strategic balance in our region. It's about presenting an adversary, any adversary with question marks. That if they had any thoughts about -

HAMISH MACDONALD: Sure, but practically, you're spending taxpayers' money. I think it's fair to ask these questions. Practically, what does this do to the military calculus in the region?

MINISTER FOR DEFENCE INDUSTRY: Well, it equips our Air Warfare Destroyers, which are our most advanced naval vessels, with the ability to strike at a long range. That increases our military capability and that increases our ability to deter conflict. You can draw it whichever way you want, but this is about deterring conflict by presenting a stronger Australian Defence Force that's in our national interest. And that's what the Albanese Labor government is committed to doing, as well as complementing it with international diplomatic efforts.

HAMISH MACDONALD: In 2022, a request was put forward to buy 20 of these HIMARS, as they're known, High Mobility Artillery Rocket Systems. Reportedly, the quote for that was just over 600 million Australian dollars at the time. Now, it's been confirmed that for 22 of these systems, the government's going to fork out $1.6 billion. Why has the price gone up so much?

MINISTER FOR DEFENCE INDUSTRY: It hasn't. The cost is comparable. The difference is in the different munitions mix. So, you don't just buy the rocket launchers, the HIMARS rocket launchers, you buy rockets and missiles and supporting systems to go with them. So, the prices are comparable. The difference is that the second purchase order will include a different mix of munitions and rockets.

HAMISH MACDONALD: So, what does that mean? Can you help us understand what that means, tangibly?

MINISTER FOR DEFENCE INDUSTRY: Well, it means that we're getting more rockets of a certain type, as well as buying the rocket launcher. So, the price goes up when you're buying more rockets to go into the rocket launcher and when you're buying other supporting systems. So, I can assure your listeners that the cost is comparable. It's the sort of complementary parts of the system that have changed. And we've increased the number and we've done that in this purchase order.

HAMISH MACDONALD: At the Labor conference recently, you said that it was against Australia's interest to have one power dominate our region, especially one that breaches international laws. What did you mean?

MINISTER FOR DEFENCE INDUSTRY: Well, what I meant is that it's in our interest to have strategic balance in our region, where no one power dominates our region. Where we have a region that is multipolar, where a region that is bound by international rules and law. So as a middle power, that's in our direct national interest. And that's what my remarks were referring to.

HAMISH MACDONALD: And is it your view that China is trying to do that, dominate our region?

MINISTER FOR DEFENCE INDUSTRY: Oh, I'm not going to be going into what other countries are doing, but it's clear that we're seeing great strategic competition in our region and it's appropriate that we respond through increased diplomatic engagement and increasing deterrence in the Australian Defence Force.

HAMISH MACDONALD: There's some reports in the newspapers this morning suggesting that one of the Big Four consultancy firms will receive $8.5 million to help design a new agency to monitor - regulate safety issues associated with nuclear-powered submarines. What will taxpayers be getting for that money?

MINISTER FOR DEFENCE INDUSTRY: Well, I haven't seen that report, Hamish, but what I can say to you is that the Albanese Labor government is committed to rebuilding capability within the Australian Public Service. What we saw was a hollowing out of the APS and we're committed to rebuilding that capability, including in the Department of Defence. We'll use consultancies where it makes sense, where they add value or bring specialist technical expertise. The question is, we have to get the balance right. But I haven't seen that specific report.

HAMISH MACDONALD: So, you're saying you're not aware of Defence Department having a contract with EY to deliver work related to this nuclear-powered submarine safety regulator?

MINISTER FOR DEFENCE INDUSTRY: Well, Department of Defence has contracts with lots of people. What I'm saying to you is, if the principle you're raising is about Big Four consulting firms having contracts, we've obviously instituted measures to put a freeze on that, to look at these matters, as the Secretary of Department has announced. But the core principle of the Albanese Labor government is to rebuild capacity within Australian public service.

HAMISH MACDONALD: But I'm just asking you a simple question. Are you aware of that contract being in place?

MINISTER FOR DEFENCE INDUSTRY: Well, I'm aware that you've raised it this morning.

HAMISH MACDONALD: But were you aware of it prior to me asking you a question?


HAMISH MACDONALD: It's a very big contract to be handing out.

MINISTER FOR DEFENCE INDUSTRY: Well, there are lots of contracts in the Department of Defence, you’re talking about one to help establish the newest submarine agency. What I can assure your listeners is that we're committed to establishing the Australian Submarine Agency. It's critical to delivering on our nuclear propelled conventionally-powered submarines, conventionally-armed submarines, which is a critical capability for the defence of the nation. And of course, we will do that in a sound and measured way.

HAMISH MACDONALD: At the Labor conference over the weekend, you accused those opposed to AUKUS within your own ranks of following the Robert Menzies appeasement strategy. What did you mean by that?

MINISTER FOR DEFENCE INDUSTRY: Those comments were directed to people outside the conference, to be frank, Hamish, that have been engaged in this debate. The important thing was the debate at the conference was done by people of good faith, with good heart, with different views.

I work closely with lots of people who are involved in the debate. I'm working closely with Michael Wright and the Electrical Trades Union on how we increase foreign aid and how we increase training of Pacific Islanders in electrical trades. I work closely with Steve Murphy and the Manufacturing Workers Union on how we build our defence industry in this country.

Those comments were about people outside the conference, and I stand by them. But the important thing was, within the conference, the debate was made by people of good faith, with good heart and ultimately the motion was carried with strong support.

HAMISH MACDONALD: Respectfully, though, Minister, your words were, "So, delegates, do you want to be on the side of John Curtin or do you want to be on the side of pig iron Bob Menzies?" Appeasement is conflict. You were talking directly to delegates.

MINISTER FOR DEFENCE INDUSTRY: I was presenting a choice to the delegates, absolutely. And I was referring to the views of those outside the conference, including those protesting at that very point. The debate within the conference was respectful by people who held principled and different views. And as I said, we work closely with them. Michael Wright is working really closely to fight to increase foreign aid and our international diplomatic efforts.

Steve Murphy and the Manufacturing Workers Union are working really closely with me to bring manufacturing home and build our defence industry. My comments were about people outside the conference who were presenting a choice that I didn't think was in the interest of delegates to accept.

HAMISH MACDONALD: Pat Conroy, appreciate your time this morning. Thank you very much.

MINISTER FOR DEFENCE INDUSTRY: Thanks, Hamish. Have a good morning. Bye bye.

HAMISH MACDONALD: That's the Minister for Defence Industry, Pat Conroy.


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