Television Interview, ABC News Afternoon Briefing

SUBJECTS: Defence Strategic Review, fuel imports from Malaysia, Viva Energy refinery fire.

PATRICIA KARVELAS: Let's return to the Government's new defence strategy and bring in Defence Industry Minister Pat Conroy. Welcome to the program. 

MINISTER FOR DEFENCE INDUSTRY PAT CONROY: Thanks for having me, PK. 

PATRICIA KARVELAS: The Opposition calls this increase tricky accounting to get to 3 per cent of GDP. It is a subjective calculation, isn't it, and we don't know how much of it's actually been sucked into pensions and other elements rather than warfare? 

MINISTER CONROY: Well, we make no apology for highlighting the NATO measurement of defence expenditure. If people want to compare different nations they should use the same measurement of defence expenditure, which is all we're doing. 

But that's not the way we're presenting the National Defence Strategy and Integrated Investment Program. We've presented it today with funding figures, dollar funding figures year on year for the next 10 years, and they show a $53 billion increase in the defence budget and $14 billion over the forward estimates. Which means through the two National Defence Strategies since we've came to power, we've increased the defence budget by $117 billion over the decade, and $30 billion over the forward estimates compared to what we inherited from the Coalition. 

This is a very significant increase in defence budget in dollar terms measured through direct appropriations and other support for defence, and it stands in stark contrast to the last government that only increased the defence budget by $10 billion in the 10 years they had in power. 

PATRICIA KARVELAS: Okay. James Paterson says it lacks transparency, though they'll have to wait to the Budget to see if it's actually really an increase because of the new metrics. Doesn't he have a point? I mean we don't have in your announcement a run down of the different line items and where it's going. 

MINISTER CONROY: No, that's completely wrong. James Paterson hasn't done his homework yet again. He's big on headlines but hopeless on detail. 

If you go to page 85 and 86 of the National Defence Strategy, you will see the budget figures for the next 10 years. They show an annual increase in the defence budget of 7.6 per cent, and it will show in table 2, which is page 86, that we're increasing the defence budget compared to what the Coalition was planning on doing by $117 billion. That's there in black and white in an official government document. 

If you go to the attachment in the Integrated Investment Program, you'll see the $425 billion Integrated Investment Program broken down by different areas. 

So he just hasn't done his homework again. He's happy to go on your show and others and slag the government, but he hasn't read a single thing. 

PATRICIA KARVELAS: Okay. I can't fact check if he's read the whole thing, but I can go to the different metrics, because there are now different metrics that you've openly said that you're going to be using. Why change them now? 

MINISTER CONROY: Well because that's in the context of when people choose to compare our expenditure on defence with other countries, and when you compare apples with apples, when you use the NATO measurement, it shows that we're spending at the moment 2.8 per cent of GDP on defence. That puts us above every single like‑minded country in the Indo Pacific. It puts us ahead of every NATO country besides the United States and those countries on the front line against Russia, so people like Poland and the Baltic States. It's more than the United Kingdom, more than Germany, more than France. But that's for international comparison purposes.

When you're trying to measure our commitment to defence, look at the actual dollar figures. Look at table A2, table 2, page 86. 

PATRICIA KARVELAS: Okay. 

MINISTER CONROY: Which shows $117 billion increase compared to what the Coalition was planning on spending. That's a true measure of our commitment to national defence. Something that we are doing that the Coalition failed to do. 

PATRICIA KARVELAS: Sure. You are also going to cut defence by $5 billion and then reprioritise it into the areas that you think are important, but you won't tell us what you'll cut. 

MINISTER CONROY: Well, we've highlighted examples of that. They were highlighted in the document itself. So the biggest one is we're retiring the C‑27 Spartan light tactical aircraft because they're very, quite expensive to run for the purpose that they're using at the moment, which is for supporting Pacific nations and transport. And we'll replace through a Pacific aviation program. 

So that's the biggest re‑scoping, and they're not cuts. They're actually saying, "This project we can't justify in the current strategic circumstances, we'll retire that capability early and invest in other things". That's prudent financial management and taxpayers would expect us not just to ask for more money, but to make sure that the money we've got we're using as effectively as possible. 

PATRICIA KARVELAS: The Deputy Prime Minister paid tribute to the outgoing defence secretary today. Why haven't you announced a new secretary at this time of war? 

MINISTER CONROY: Well we're going through an orderly process of selecting a replacement for a very important position. It's not unusual to have someone acting in that role for a month or two. Cath Patterson's the associate secretary and she's a very experienced public servant. We just named the new leadership of the defence force this week, so we're getting on with the job but we're going to do it in an orderly way, which is what people expect from a cabinet government that we're running. 

PATRICIA KARVELAS: The Defence Minister also said today work was under way in building the submarine construction yard at the Osborne Naval Shipyard. That is where we're building the first Australian made nuclear submarine of course. That program does actually really depend on lots of specialised things. How resilient is the supply chain if conflict in the Middle East keeps continuing? Won't that impact all of the work you're doing there? 

MINISTER CONROY: No, I don't believe so. We're building the Australian industry to build our submarines. They're winning work right now helping build UK and US submarines, and that will help form the basis for constructing our submarines, which is due to begin by the end of the decade. 

We're also training lots of Australians. We're building the submarine training academy right now, the skills and training academy that will train thousands of Australians to do this work. 

So I've got complete confidence in the Australian industry's ability to do the work. I was in the UK in February, and I saw the first parts of the reactor modules for our first two submarines being built right before my eyes. So this project is on track, it will drive 20,000 jobs in our economy and equip the Royal Australian Navy with the most advanced submarines in the world, which will help deter conflict in our region. 

PATRICIA KARVELAS: I just want to go to the fuel refinery fire today. Should consumers in Victoria expect an immediate price shock at the bowser from that oil refinery fire in Geelong? 

MINISTER CONROY: Well first off I want to pay tribute to the firefighters and the other emergency service personnel who handled the situation so well, and I'm very grateful that everyone is safe.

Viva has said that they're confident they can replace the lost petrol production through imports. That's their statement and I think I've got no reason to doubt that. Thankfully the production lines for diesel and jet aviation fuel weren't damaged by the fire. 

Importantly, also, Prime Minister Albanese announced that we've secured 100 million litres of diesel through two shipments under the Export Finance Australia mechanism we announced a few weeks ago. 

So we're working very hard on supply to make sure that Australian households have the fuel they need. We urge people obviously to be careful and only buy the fuel they need, but we're working very hard on supply at the moment. 

PATRICIA KARVELAS: Okay. But you were already working on supply and now you'll have to import more, so doesn't that just show that the situation is even more urgent, that the Prime Minister's going to have to fly around a whole lot more? 

MINISTER CONROY: Well again, Viva has indicated that they're confident that they can replace the petrol that will not be produced while that particular part of the facility is being repaired. 

We've got 57 vessels on the water coming to Australia right now, that's roughly the same as this time last year. It's the normal course of events. And we've secured additional fuel loads. 

PATRICIA KARVELAS: Yep. 

MINISTER CONROY: Last month there was a hullabaloo of about six shipments being cancelled. Well guess what? We replaced them with nine. 

So this is a difficult situation, we're not pretending otherwise. 

PATRICIA KARVELAS: Yeah. 

MINISTER CONROY: But we're working very hard and supply is being maintained. 

PATRICIA KARVELAS: Again, James Paterson said the problem is that this is not a binding agreement, for instance, today with Malaysia. It's true, right, it doesn't bind them? 

MINISTER CONROY: Well, Mr Paterson, Senator Paterson, rather, again is happy to carp from the sidelines. We're striking agreements with important regional partners, partners that rely on us as well. So they rely on us for either energy imports from Australia or food imports, for example.

So there's a real spirit of goodwill and the regional diplomatic missions that Prime Minister Albanese and Foreign Minister Wong have participated in is all about building and securing those partnerships. And I think most Australians would appreciate them doing it, would expect us to do that. 

PATRICIA KARVELAS: Thank you so much for joining us. 

MINISTER CONROY: Thanks PK.

ENDS