National Defence Strategy and Integrated Investment Program, Ghost Shark

SUBJECTS: National Defence Strategy and Integrated Investment Program, Ghost Shark.

MINISTER FOR DEFENCE INDUSTRY PAT CONROY: Well, good morning, everyone. I’m joined today by Professor Tanya Munro, Chief Defence Scientist, Rear Admiral Chris Smith, Commander of the Australian Fleet; Major General Anthony Rawlins, Head, Force Design; and Major – sorry, Mr David Goodrich OAM, CEO of Anduril Australia. 

Today is a great day for the defence of the nation and a great day for Australian industry. With the release of the National Defence Strategy yesterday, the Deputy Prime Minister Richard Marles outlined the strategic circumstances we face. We face the most uncertain strategic circumstances since World War II. We see the biggest buildup of conventional forces in our region since then as well, and the Australian government is moving at light speed to respond to these challenges. 

Importantly, we’re matching our rhetoric with action and we’ve announced through the Integrated Investment Program yesterday $330 billion of investment in new capabilities and sustaining those new capabilities over the next decade. That includes $50 billion of additional funding over the next 10 years and $5.7 billion of new funding over the next four years to meet those challenges. 

Importantly, a key part of that program is the Albanese Labor government’s commitment to over $10 billion of expenditure in acquiring autonomous vehicles and drones – over $10 billion being spent on acquiring autonomous vehicles and drones and over a billion dollars on counter drone capabilities. 

One of the most exciting projects that is being worked on is the project that’s standing right behind me – Ghost Shark. Ghost Shark has been a co-development between the Defence Science and Technology Group, the Royal Australian Navy and Anduril. They’ve been co-developing this sovereign, uncrewed sea power capability and, importantly, it's a co-investment. Over $70 million from Defence, over $70 million from Anduril and a tonne of staff working on trying to develop and deliver the most advanced undersea autonomous vehicle – vessel in the world. 

And situated behind me is the first prototype – the first prototype of an extra large autonomous undersea combat-ready drone. This drone is capable of doing intelligence-gathering, surveillance and reconnaissance and, importantly, delivering strike. So it has the ability to be fitted with weapons to deter potential aggressors. 

Importantly, we’ve had a contract to deliver three prototypes. This project started in the middle of 2022. This one was delivered right now, delivered one year early and on budget. Let me repeat that, because it is unusual – the first prototype was delivered one year early and on budget. And all three will be delivered by June 2025. So from conception to full realisation, less than three years. 

But, importantly, today, ladies and gentlemen, I’m announcing as part of our 5.2 to $7.2 billion investment in undersea, uncrewed maritime systems that we’ll be moving from prototyping to producing the Ghost Shark, moving from a theory and a prototype to production of the Ghost Shark. That will obviously be subject to Ghost Shark continuing to meet its key performance indicators, and so far it’s not just meeting them; it’s surpassing them. 

So this project started in mid-2022; first prototype in mid-24, and we will have the first production variant by the end of 2025. So we’ll go from an idea to production variants of this in three and a half years, demonstrating the new speed that the Albanese government is injecting into Defence. 

Importantly, this will be also mission zero for the Advanced Strategic Capabilities Accelerator – ASCA – that is at the cutting edge of innovation. We’ve allocated around three and a half billion dollars to ASCA to bring bright ideas to prototypes, to production-ready variants that can equip the Australian Defence Force. And this is a really new model where for too long we funded good ideas but there’s been no path to production. 

This as the first mission – mission zero – demonstrates what we’re trying to do – that is, fund a good idea, co-develop it and have an acquisition path with Defence that will actually fund them into service. And, as I said, the first will be delivered by the end of 2025. 

Importantly, this advanced capability – one of the most advanced capabilities in the world – isn’t just great for the Royal Australian Navy in giving them the capability to do reconnaissance and strike well away from the Australian continent – thousands of kilometres away from the Australian continent potentially – it’s great for Australian jobs. Anduril has been doing all this work in Australia. It’s designed in Australia. Importantly, they’ve partnered with 42 other Australian companies to produce this, so it’s great for Australian jobs as well. 

So if I can conclude, ladies and gentlemen, this is part of our record $330 billion investment and it’s a demonstration of our commitment to bringing equipment into service at speed, moving from an idea to in service in three and a half years. 

We’ll take questions first on today’s announcement then we can go broader than that. Yes, sir.

JOURNALIST: Colin Clark at Breaking Defence. Do you expect industry to come up with the kind of co-payment that Anduril did as you go through these? So they’re going to have to put in more cash upfront than they historically have for a lot of these programs? 

MINISTER CONROY: Well, I’ll invite Chief Defence Scientist Tanya Monro to talk about the ASCA model, but from my point of view, flexibility is key. In some areas we will fully fund it, but I’ll be very frank with you: one of the reasons this moved so fast and was so easy to get approval was that Anduril put their own skin in the game. They put $70 million of their own money in, which meant it was very easy because that demonstrated their commitment. So it wasn’t just us funding something; it was a co-development approach. 

Tanya, was there anything you wanted to add? 

TANYA MONRO: Thank you, great question. Of course when we’re working with small to medium enterprises we need to cover costs because it’s not always possible for companies to co-invest. But where it’s possible we do prefer that model because, as the Minister said, skin in the game means we together share objectives. And it’s in industry’s interests then to accelerate. So we have a mixed and flexible model. What matters most is accelerating capability into the hands of the war fighter. 

JOURNALIST: Do you expect lots of SMEs or more primes? 

SPEAKER: Sorry, please direct [indistinct]. 

TANYA MONRO: Certainly, sorry. So I see in this mission and future missions going forward with ASCA that SMEs have a critical role to play. This does not exclude primes, but Defence is not necessarily always going to use primes to integrate solutions for Defence. Thank you. 

MINISTER CONROY: Any other questions on today’s announcements? 

JOURNALIST: Yes, just generally, is there a time line when the government will announce the east coast submarine base? 

MINISTER CONROY: Well, we’ve been very clear that our focus at the moment is on developing the submarine construction yard at Osborne in Adelaide and pumping billions of dollars into upgrading HMAS Stirling on the west coast to be home to Submarine Rotation Force West in 2027 and then home to Australia’s own sovereign Virginia class submarines from the early 2030s. That’s our focus. 

We’ve been very clear that we are looking at an east coast base for our submarines, but that is a bit further away. Our focus is on the construction yard and the base for Submarine Rotation Force West. 

JOURNALIST: Minister, why are you cutting the naval support [indistinct] to do replacement at sea when you’re doubling the size of the service fleets? 

MINISTER CONROY: Yeah, thanks for the question. Our main focus – and I’ll invite Major General Anthony Rawlins to see if he has – wants to add anything. We’re focused on increasing lethality of the Australian navy. That’s why we’re more than doubling the fleet going from 11 major surface combatants to 26 major surface combatants. So that’s been our focus. 

We’ve got two supply vessels that are doing great work. The joint supply vessel – support vessel that was part of the previous government’s plans was not just about support; it was also about amphibious operations, and we’re hitting that need through acquiring 26 medium and heavy landing craft for the army and bringing those projects forward so that the first medium landing craft will be delivered in 2026 and the first heavy in 2028 compared to 2035. So we’re fulfilling that requirement through other means. 

JOURNALIST: Minister, why are we only buying 72 fighter jets now [indistinct]? 

MINISTER CONROY: Yep, so the last government’s plan was to retire prematurely the Super Hornets. The Super Hornets are an excellent capability that’s doing great service for the Royal Australian Air Force. The US Navy plan to run their Super Hornets out to 2040, for example. So these are great aircraft that are doing great work, and we made the very sensible decision not to retire them early. 

We will look at their replacements a bit further out, and that could be another squadron of Joint Strike Fighters or it could be another aerial capability. But, importantly, it would be a waste of money to retire the Super Hornets early, and we’re using the money saved to invest in long-range strike, some more advanced missiles for the air force, more long-range strike for the Australian Army and more than doubling the naval surface fleet. 

JOURNALIST: Minister, should the Australian defence industry [indistinct] focus on minimum viable capability [indistinct] US? 

MINISTER CONROY: Well, no, they shouldn’t. In fact, it’s the opposite. When we do foreign military sales cases and buy from the United States, we expect those capabilities to be at a hundred per cent of capability. When we acquire our Apache Attack helicopters from Boeing, they will be coming off an established production line and we would expect them to deliver from day one exactly what’s promised. 

Minimum viable capability is about saying when we’ve got developmental projects, rather than spending disproportionate amounts of time and money on the final 15 per cent of capability, we’ll accept it into service earlier and upgrade it through an upgrade pathway like your iPhone or things like that. That actually gives Australian industry a foot in the door because they’re the ones doing the developmental work rather than us buying something from overseas. 

JOURNALIST: Minister, most of the capabilities that you’ve committed to buying so far are coming in in the far end of the five-year period. And we hear a lot of people in the ADF, like, we need things now. Are you concerned about this? Is this part of the effort to fill that gap? 

MINISTER CONROY: Well, I reject the premise of your question – it won’t surprise you to hear that. We are moving at great speed. Ghost Shark behind me is an example of that. As I said, an idea discussion between Anduril and Defence in the middle of 2022 will be hitting production of that by the end of 2025 – three and a half years. 

Another example is we’ll be manufacturing missiles in this country next year – next year – when we’ve only been in government for less than two years. We’re bringing forward the landing craft so that we’ll be delivering the first one of those in 2026. We’ve brought forward the delivery of the high mobility artillery rocket system so that the first one will be in country by the end of next year. We’re moving at light speed to re-equip the Australian Defence Force so that we can protect the Australian people. This is all about promoting the safety of the Australian people, and we’re doing that with all due haste and with increased resources. 

JOURNALIST: Minister, Andrew Hastie said that cuts to projects [indistinct] is this true? 

MINISTER CONROY: Well, quite frankly, Andrew Hastie has no credibility on this topic. He stood up yesterday and did a press conference – sorry, before I get into that one, because that’s a political question, are there any other questions on broader Defence topics? No? 

I might ask the rest of the team to exit. It’s just very important to preserve the impartiality of the Australian Defence Force. 

So let me go again. Andrew Hastie has zero credibility on this. Andrew Hastie admits he stood up at a press conference yesterday without reading the documents that he was talking about. How can you comment on something when you haven’t read it, is my question. Importantly, also, only three days ago they were committed to only spending 2.1 per cent of GDP on Defence, which would have been a $50 billion cut over the decade. Now they’re saying they’re going to spend who knows what. They’ve had more positions than I’ve had hot meals, quite frankly – and I’ve had a few of those. They are a joke on Defence.

If you want further evidence of that, they announced $42 billion worth of projects without increasing Defence funding by a single dollar. By contrast, we’re increasing Defence funding by either $50 billion over the decade, including $5.7 billion over the next four years, and we are making hard decisions to reprioritise funding. Yes, the Joint Strike Fighters are a great capability, but so is the Super Hornet, and we should be running them as long as they were planned to deliver to then spend that money on more missiles for the Australian Defence Force is one example. 

Any other questions? No? Okay, thank you very much, ladies and gentlemen. 

ENDS

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