Radio Interview, ABC Melbourne

SUBJECT: Defence Estate Audit

ALI MOORE, HOST: Richard Marles is the Minister for Defence and the Deputy Prime Minister. Richard Marles, hello.

RICHARD MARLES, DEPUTY PRIME MINISTER: Good afternoon, Ali. How are you?

MOORE: Good. So today the news does sort of beg the question of why it’s taken so long to make the final decision on these assets?

MARLES: Well, I mean, that is a good question when you look at the review of the Defence estate that was done by Jan Mason and Jim Miller. I mean, one of the points they make is that what we are dealing with now is a legacy of decades of indecision and that the failure to deal with the consolidation of the Defence estate is one that’s really been in place over decades. And, the quote that they put in their report is that there has been a lack of both political and organisational will to make this happen.

MOORE: So that’s both sides of politics?

MARLES: Well, to quote the report, they make that observation over the course of decades, and it would be absolutely right to say that the reform that we’ve announced today, in agreeing or agreeing in principle to all the recommendations of the Defence Estate Review, is the most significant reform to the Australian Defence estate in our history, and it will be the biggest consolidation. So, there is a lot to be done here. I suppose, specifically, we got this report at the end of 2023. If I’m being honest, the size of it and the significance of what was being put forward in it was more than I had expected. But it’s an excellent piece of work, and it really has taken longer than we had thought over the course of the last two years to work this through. There are personnel implications associated with this. There’s a number of community organisations which engage with a range of Defence bases around the country, and so we’ve had to work through all of that. But having said that, against the backdrop of decades of no action, this is very much a huge step that we’re taking today.

MOORE: So there must be a lot of relocation, and a lot of these sites were obviously continuing to be used. If you look at what you’re expecting to make from it — because I said $1.8 billion in a return, but I think the starting is $4 billion — but you’re going to lose the rest of it just in the relocation and, you know, the costs involved in this whole process.

MARLES: Yeah. Look, there’s an estimate in the report of actually a kind of combined sale on the order of $3 billion, with about $1.2 billion needing to be spent in terms of relocation, yielding a benefit of $1.8 (billion). That’s roughly the numbers. But the report itself obviously says that that’s all something of an estimate. I think that’s an important part of it, to realise that money for defence and all the money that’s recovered from this disposal will go directly into defence capability. But, to be honest, a bigger issue is the maintenance of these properties right now. I mean, we’re spending — for example, Spectacle Island, which is in Sydney Harbour, which hasn’t had any Defence Force personnel since 2023 — we’re spending, over the last four years, $4 million in just securing that site. And the review estimates that over the course of the next 25 years, we’ll spend $2 billion on this estate if we don’t do anything about it, without any addition to our defence capability. And obviously that’s an untenable situation, and that’s the significant saving in what we’re doing.

MOORE: So let’s look at that. There’s 16 sites, I think, around Victoria. Who are you going to sell them to? Because it seems that there’s a couple of different options, and an obvious one would be, well, don’t sell them and build public housing.

MARLES: Well, look, the mechanism that we are going through here is to transfer these sites relatively quickly into the hands of the Department of Finance, which really is the asset management specialist for the Commonwealth government. That process will happen over the course of the next couple of years. But the actual disposal of the sites out of the hands of the Commonwealth potentially can be done sooner in some cases, but it may well be much longer in other cases. I mean, there are some sites that are very iconic, that are large, that will require a lot of investigation in their own right in terms of what is the best outcome for that. And so the way in which we’ve done it enables a benefit for defence to be yielded relatively quickly, whilst giving the government and the Commonwealth the space and time to actually realise the maximum benefit from these sites.

MOORE: But does it need to take the—

MARLES: both in terms of the income of the government, but also the use of the site going forward.

MOORE: Does it need to take that long, though? I mean, you’re talking about a couple of years. We’ve got sites like the munitions site at Maribyrnong. I mean, what’s to stop that almost immediately going into becoming a housing site? We have such a desperate need for housing.

MARLES: Well, it is a good example. So, I mean, you’re right that it’s a very large site, the Maribyrnong site, but it has been used over years as a kind of a test place for ordnance and a firing range, which means that the site is really contaminated. It requires an enormous amount of remediation, which is measured in millions, if not tens of millions of dollars, to put it in a place where it could then be sold and to realise a benefit. So it is going to take a significant amount of work to put it in a place where we can ultimately sell it. And it is an example of the kind of work that has to be done on some of these. So there are some sites across the Defence estate which are actually relatively easy to sell. In fact, of the properties that were highlighted in the review, we’ve already sold three. But there are others — and Maribyrnong’s an example — which are going to take time. But I mean, if you look at a site like Point Cook or a site like Victoria Barracks Melbourne, which is in St Kilda Road, I mean, these are large sites which are going to take a lot of work to understand what their future use might be. And so that is, in reality, going to be measured in years. And from the Commonwealth’s point of view, the entity which is best placed to do that sort of work is the Department of Finance.

MOORE: And is the department best placed, though, to understand, in many cases, really historic significance of some of these sites that people would hate to lose from public hands? And no doubt there’s some heritage listing as well.

MARLES: Well, so, good question. So, in respect of the heritage value — and there are some really significant sites from a heritage perspective around the country — and in Victoria, I mean, Victoria Barracks Melbourne has in it the War Cabinet Room. You know, during the Second World War, whilst Canberra was the capital, much of the public service was in Melbourne. And so, in fact, a lot of the key decisions that were made in 1941, which really go to our nation’s independence, happened in that Cabinet Room on Victoria Barracks. But the point I’d make is it’s actually not accessible to the public right now. I mean, the heritage of that room, for example, doesn’t belong to the Australian Army or, for that matter, the Australian Defence Force. It belongs to the nation, and there needs to be an outcome here which makes that much more accessible. I’d make it really clear that these buildings are protected by law, and that’s the heritage laws that we have in place in Australia that protect them. So there’s no — these buildings will continue. But what we will now see as a result of this, whatever is their future, is something where they are opened up, because right now actually they’re off limits. I’ve seen that room but members of the public can’t see — the War Cabinet Room — and it’s a really significant room and very important. And, you know, you can look at Victoria Barracks in Sydney, which is really the beginning of the Defence Force. Those buildings there are incredibly significant, but they exist behind a wall and they’re not accessible to the public. And so this is going to be a much better heritage outcome because it actually returns the heritage to the nation.

MOORE: You’re listening to Richard Marles. And Richard Marles, I know I’ve got to let you go because Parliament’s sitting, but just a quick final question. If you take off your Defence Minister hat and put your Deputy Prime Minister hat on, can you reassure people that the Department of Finance will consider many of these sites for housing? Because that’s the overwhelming feedback that we’re getting — public land build, public housing.

MARLES: Yeah, look, I mean, in terms of housing, there may be a number of sites which do make sense in terms of housing, and obviously all of this will be considered going forward. But I do want to emphasise that none of those decisions have been made yet. And as we work forward in respect of each of these sites, there is going to be a thorough investigation as to what is the best use of the land. But, to be frank, what is the best opportunity for a return to the Commonwealth? Because that is money that will ultimately be reinvested in our defence capability - that’s at the heart of this decision. But I can imagine that in respect of a number of properties, housing is a possibility. But all of that needs to be worked through, and it needs to be worked through in the context of what would be the normal planning regimes that apply at a state level and, for example, the infrastructure which goes with them. So, this is all steps that need to be worked through, and in some instances that’s going to take years.

MOORE: Richard Marles, I really appreciate your time. Thank you.

MARLES: Pleasure, Ali.

ENDS