Television Interview, ABC 730

SUBJECTS: Defence reforms, AUKUS, progressive patriotism

SARAH FERGUSON, HOST: The Federal Government is coming clean about the dizzying sums of money lost in the highly complex world of defence procurement. Multiple reviews have identified the problems, but neither side of politics has found a fix. According to Defence, Australia is about to enter its most dangerous decade since the Cold War. The solution is now or never. Pat Conroy is the Defence Industry Minister. Pat Conroy, welcome.

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

FERGUSON: Now, your taskforce found $29 billion of cost blowouts on a small number of projects before those projects were even signed. How much money are you saying in total has been wasted over a decade?

CONROY: Well, what I'm saying, Sarah, is that the system is broken. And this is not about individual public servants or ADF officers. The system is not setting them up for success. What we've seen is a series of ineffective practices that mean that we're facing this situation right now. And that's why we're putting in place the biggest reforms to the Defence organisation in 50 years, because it can't continue as it has been for more than a decade now.

FERGUSON: What's the total number you think has been wasted over the decade? If you, if your task force has found $29 billion on a small number, what do you think? You must know.

CONROY: Well, I'm not going to speculate on a figure. This task force took a sample of projects and they took this sample to understand what is driving behaviour and they found on average a 38% increase in the cost of projects before we get even into contract. And that's for a couple of reasons. One, cost estimation is not up to scratch. Secondly, we don't have change discipline. Let me give you an example. The Hunter-class frigates, $500 million worth of changes were made to the design without talking to the people actually building the ship on what that impact would be on cost or schedule. We just can't afford that anymore. And that's why we're announcing these reforms.

FERGUSON: You've been the minister responsible since 2022. At what point does a government that's been in power for four years own these failures itself?

CONROY: Well, I take responsibility. Every minister involved in this over the last 15 years should take responsibility for what's occurred. This sample included projects that had started well beyond a decade back. So, this has outlasted governments of all persuasions. We announced reforms in October 2022 that have improved the situation. But it's clear that we need to do more and that's why these radical reforms are necessary and that's why we're doing it. This will improve accountability, this will improve performance. And we're being transparent with the Australian public that we need to do better. But we should also be fair dinkum that no one around the world does this perfectly… 

FERGUSON: ...Exceptionally well. One of the, one of the items that you are identifying is a particular investment. The investment committee has got 26 people on it, failed to make decisions on 56% of recommendations it considered in 2025. But you were the minister. Couldn't you have better directed that committee for the time that you've been minister or your predecessor for the four years that this government has been in power? I think what I'm getting at is being clear that you own some of these failures.

CONROY: I own the challenges that we face. 

FERGUSON: And the failures.

CONROY: And the failures. I'm open about that. This is being about being transparent with the Australian public that the system put in place through the 2014 review by the Abbott Government where they outsourced project management from Defence to the private sector has failed. They put in place a bureaucratic structure where 26 of the senior leaders spent cumulatively 1600 hours in meetings where they – 

FERGUSON: Sure, as I just said, you've been in, you've been in the position as minister for a couple of years with control over the public servants as well as over how those decisions get made. So, you, you own that as well as Tony Abbott putting it in place.

CONROY: And that's why we've announced the biggest reforms to the defence in 50 years. We announced them last year. We didn't announce another review. We made a decision to reform and those reforms have come into place yesterday. And that's a great thing for this country.

FERGUSON: You don't – you say you don't want to blame the hard working public servants in defence. Then who are you holding responsible for what is essentially atrophy and management failure inside defence?

CONROY: I'm blaming the system. The system that's been constructed….

FERGUSON: But systems are made up of individuals.

CONROY: Absolutely. And the systems that have been constructed over decades in a different environment where they're all about minimising risk rather than managing risk. All about just layering on top of each thing bureaucratic decision making. Let me give you an example that got told to me by a senior Defence leader. On certain decisions he needs 70 signatures to make a decision. We can't afford that now. This is about making clear accountability where there's one person in Defence accountable for making decisions to the ministers on what equipment to buy. And one person, the National Armaments Director who's accountable for delivering those projects. And that person won't report to other bureaucrats. They'll report directly to myself and Richard Marles.

FERGUSON: And just to be clear because there have been numerous attempts to fix defence procurement over the last, certainly over the last 20 years in fact. Really if you look at history since Federation. What is your measure of success for what you are bringing in? How will we know whether or not it's worked?

CONROY: The measurement of success is faster decision making. Getting equipment to the warfighters faster than it is now, better value for money for taxpayers and more jobs in Australia. They're the three KPIs. And accountability – people making decisions fast and reporting to ministers who bear responsibility like me.

FERGUSON: You're giving a speech tomorrow in part to claim Defence as part of the great Labor project using John Curtin as an example. John Curtin as a wartime prime minister, raised the fifth biggest military in the world in three years during World War II. What would Curtin say if he could see this Defence Department shot through with the kind of atrophy that you're describing?

CONROY: Well, Curtin would say – and it's always dangerous to speculate on what other people would say…

FERGUSON: Yes, but you're claiming him as a precedent for this, for Defence being part of a great Labor tradition. What would John Curtin say if he could see the modern Defence Department?

CONROY: Well, he's my great hero and he said he would say change is needed and that's why we're doing this. And I reference not just Curtin during his wartime period, I reference him in the late 30s, railing against Menzies stripping soldiers from the army, appeasing potential adversaries like Japan, appeasing Adolf Hitler. He railed against that. And he called for investment in the Air Force and Navy, which, if it had been followed, would have put us in a lot better position. So, he would have called for better speed, more courage and taking hard decisions. And that's what we're doing. We're also levelling with the Australian public that we need to do better, and governments of all persuasions should be doing that.

FERGUSON: This is obviously money, the amount of waste that you're talking about, many, many billions of dollars that could be spent on Labor priorities – the NDIS, aged care, childcare. Are you also, by making this so public, trying to see off a potential revolt against AUKUS within Labor and promising them more money to spend on traditional Labor projects?

CONROY: Not at all. The support for AUKUS stands at the strong position it has been since it was announced within the Labor Party. This is about saying we've just overseen the biggest increase in Defence budget in peacetime ever, $117 billion over the next decade.

FERGUSON: Not the moment to get into the realities of funding. But this is not about seeing off a revolt inside your own ranks?

CONROY: No, it's about making the case for why this money should be spent wisely and talking to people about how we'll do that. Biggest increase in funding in peacetime history and demonstrating that we're making the hard decisions to make sure every cent is spent wisely and that we get the equipment to the ADF that they need.

FERGUSON: One of the other things you're talking about tomorrow is progressive patriotism. How's that different from populist patriotism espoused by Pauline Hanson?

CONROY: Well, it's about love of our country. Love of our country as it is and as a desire.

FERGUSON: She thinks its love of her country.

CONROY: Well, I would argue calling for a monoculture isn't loving our country because our country is proudly multicultural, for example, and that's one of the values I talk about. Our values of fairness, equality and multiculturalism make Australia the best country on earth. And progressive patriotism is about saying we can do better. That's why we're making record investments in Medicare, in education, in paid parental leave. We want it to be better and we want to defend it. And that's what this is about.

FERGUSON: And is it important for you to do it in the press club tomorrow where Pauline Hanson gave that speech that led to the discussion on monoculturalism?

CONROY: Well, there's a certain symmetry there, that we've been booked in advance of that. But it is important. Multiculturalism is one of our strengths in this country and I'm quite frankly sick of politicians bending the knee to Pauline Hanson and somehow uttering merely words about this. We're a multicultural country. We have been since 1788, if not before then. As a proud descendant of Irish convicts who were Catholic, their Protestant jailers had a very different culture. We're proud to be a multicultural country and that makes us stronger for it.

FERGUSON: Pat Conroy, thank you very much indeed for joining us.

CONROY: Thanks for having me.

ENDS