Radio Interview, 5AA Mornings

SUBJECTS: 2026 National Defence Strategy and 2026 Integrated Investment Program; Middle East Conflict.

GRAEME GOODINGS, HOST: Joining us now is the Deputy Prime Minister and Defence Minister Richard Marles. Deputy Prime Minister, good morning. Thanks for your time today.

RICHARD MARLES, DEPUTY PRIME MINISTER: Good morning, Graeme, how are you?

GOODINGS: Well, thanks. So, what prompted this increase in defence spending?

MARLES: Well, every two years now we are releasing a National Defence Strategy, which is a periodic reassessment of our strategic landscape, an updating of our Integrated Investment Program. That's the 10 year spend that we make on defence equipment. And so that's what we released yesterday. And as part of that, we've announced the increases that you've described, which is a 14 million – billion, I'm sorry – dollar increase over the next four years, a $53 billion increase over the next 10. And what that means in total, since we've come to government back in 2022, is, you know, we've increased defence spending by about $30 billion over the next four years and $117 billion over the decade. Now, they're big numbers, it's hard to kind of put them into context, but during the period of the Abbott, Turnbull, Morrison government, they increased defence spending by about $10 billion over the decade. So, that is to say we've really done 12 times as much in the last four years as what the former Coalition government did in nine years. And I think that does give a sense of context as to the significance of this. It really is the biggest peacetime increase in our defence spending in our nation's history.

GOODINGS: But how much of this is new money? Or is some of it relocation? All new money?

MARLES: Yeah, I mean, and to be clear, there is, in addition to what I've just said, some reallocation. So, we've reprioritised about $5 billion of the Integrated Investment Program over the next four years that, to give you a sense, is around 4 per cent of the spend. So, we've kind of scaled back on some things to give room for others. But that's in addition to the numbers that I've just given you, which creates more space, in fact, to reinvest in the critical technologies that we need.

GOODINGS: How much of this new $53 billion is earmarked specifically for AUKUS?

MARLES: AUKUS remains a really significant part of our defence budget. I mean, the way to think about AUKUS really over the journey is AUKUS represents about 0.15 per cent of GDP in terms of our spend. And that's in a context where our defence budget is around 2.8 per cent of GDP. So, that gives you a sense of the relative size of the submarine program in the context of the overall defence budget. We are moving into a period of the submarine program, which is meatier, if I could put it that way, where we're spending more. And that's, a lot of that is around, for example, the construction of the Osborne Naval Shipyard at Port Adelaide. And by the end of this decade we will be actually into the building of the submarines themselves that will roll off that production line in the early 2040s. So, that is seeing an increased expenditure in the here and now. But it sits within the overall envelope that we've always thought for AUKUS, which as I said, is about 0.15 per cent of GDP relative to an overall defence 2.8.

GOODINGS: You've said this is the biggest peacetime increase in defence spending in our nation's history. How much of this has been brought about by the state of the world at the moment?

MARLES: Well, it is about the state of the world at the moment. That's completely what's driving this. I mean, we are facing the most complex and threatening strategic circumstances that we had since the end of the Second World War. And as we articulated yesterday, that's driven by a much greater degree of major power contest, geostrategic contest, and that's particularly competition between China and the United States. But I think what we're also seeing, and particularly with China, I mean, China is engaging in the biggest conventional military build up since the end of the Second World War of any country at any time. And that's necessarily changing the shape of our strategic landscape. And it's very much in the context of that that we need to be thinking through our circumstances and making sure that we're ready. And so that is what's driving our, the increase in our defence spending. But the overall strategic landscape that we're facing around the world. And you see that in how other countries are reacting as well. I mean, defence spending is increasing throughout countries in the Indo Pacific, as they are throughout the countries of NATO and Europe and North America. And that is very much a function of the world that we're living in today.

GOODINGS: What role will private capital and superannuation funds play in helping deliver our capabilities?

MARLES: Look, again, a good question that they will play a role. And this is something that's not new. We've had private capital be used, going right back to the Howard government, to help build some infrastructure for the Australian Defence Force. But when we did the Defence Strategic Review in 2023, it highlighted the idea that we've got the fourth largest superannuation fund capital in the world, it's going to end up being the second, that this is a national asset that we should use. And so, you know, without apology, we have sought to pull that lever more. But again, to give you a sense of context, over the 10 years, the entirety of the Integrated Investment Program, that is that the 10 year spend is about $425 billion. Now, we are imagining that about 15 billion of that 425 will be through alternative financing. So, the vast bulk of this is we're doing through the budget. And again, to give you a four year number, it's about five billion out of 117 billion. So, we're doing, we're doing it and we're doing it more, but it still represents a pretty small proportion of the overall defence spend.

GOODINGS: Now, let's refer back to AUKUS submarines. It's going to be the 2030s, the soonest that we get AUKUS submarines. Is there any interim measure? What can we do with conventional submarines?

MARLES: Yeah, there is. And so, in fact, when we talk about the submarine program now, we combine not just the building of our future submarines, but also the life of type extension of the existing Collins-class submarines. And that too is activity, which occurs at the Osborne Naval Shipyard in Adelaide. And it's a really important program. I mean, we do need to extend the life of the Collins-class beyond what was originally anticipated in the late 90s and early 2000s to get these submarines well into the 2030s, which is what we'll need in order to, as you say, meet that moment when the first Virginia-class submarines come online within the Royal Australian Navy. And so there is an extensive program of doing more life of type extension. That really means a very significant maintenance of each submarine where you are kind of putting in new technology, updating its systems and the like, and getting more years out of the platform. And that as we think about how we make sure that our submarine capability evolves, gets better over the course of between now and when we have a fully nuclear powered submarine fleet. This is a really important step.

GOODINGS: Now Australia's alliance with the US remains central. Donald Trump in the last few hours was asked about our defence spending. He said, I'm not happy with Australia because they were not there when we asked them to be there. How do you assess that?

MARLES: Well, look, we work really closely with all our allies and partners and that includes the United States. And I mean specifically in respect of the Strait of Hormuz, you know, we will, the Strait of Hormuz are obviously really important to Australia and we can see that as everything that's playing out now. And we're working with the US as we are working with countries like the UK and France around what contingencies might be put in place in respect of the Strait of Hormuz when circumstances allow. But, you know, that last point is important. It depends on when there is a situation which actually enables this to occur. But we will play our part and we will seek to make whatever contributions we constructively can to see the Strait of Hormuz remain open when we get to a point that it reopens, and we want to see that happen. You know, we've also been providing for the defence of the nations of the Gulf, particularly the United Arab Emirates. We have had a request from the US over the last month to assist in supporting the defence of the countries of the Gulf. We've actually been doing that. So, we continue to work very closely with the United States and but obviously assessing everything that we do in the context of Australia's national interest.

GOODINGS: Deputy Prime Minister, thanks so much for your time.

ENDS