Press Conference, Adelaide

SUBJECTS:  Osborne Shipyard Investment; Australia-UK relationship; AUKUS; ALP National Conference; Political Donations; Defence spending; US tariffs; Military Court Proceedings

RICHARD MARLES, DEPUTY PRIME MINISTER: Well, welcome, everyone. It is fantastic to be here with Pat Conroy, my colleague and Minister for Defence Industry, and we’re here today, of course, with the Premier of South Australia, Peter Malinauskas, and the Minister for Defence Space Industry, Chris Picton. And let me start by saying we are so grateful for the partnership that we have with the South Australian government in delivering this incredible facility. And we could not wish for a better partner than what we have in the South Australian government. Today, we are announcing a commitment of $4.6 billion in this facility, building the submarine construction yard here at the Osborne Naval Shipyard. Now this adds to the $3.9 billion, which was announced by the Prime Minister and the Premier back in February. This is an investment in jobs in South Australia. It is an investment in a giant leap in Australia’s defence capability. This will contribute to a project which will be delivered over the course of the next decade, where we will see 50 different buildings constructed here at the submarine construction yard. And the first of those buildings – which we’re actually in right now – will be delivered within the next 12 months. And what that does is enable us to begin the construction of our future submarine, cutting steel on it, before the end of this decade. Right now, there are 1100 construction workers who are in the process of building what we see around us. That is going to grow over the course of the next few years, up to 4000 people involved in the construction of this yard. And just as a reminder, today at the Osborne Naval Shipyard across the upgrades of our Hobart-class destroyers, the building of our Hunter-class frigates and the life-of-type extension of our Collins-class submarines, there are 5000 people working at the Osbourne Naval Shipyard. But in just a few years’ time, that will double to having 10,000 people based here when we are in the process of building our future submarines. Right now, this is the largest industrial site in the country. But it will be easily that in the coming years as we get to a number of north of 10,000 people. And they are jobs that will be here for generations to come. And so, this is a hugely significant facility in terms of what our nation’s industrial capacity is. This will be the highest-tech production line in Australia. It will be one of the highest-tech production lines in the world. The $4.6 billion that we’re announcing today on top of the $3.9 billion that we announced in February – a total of $8.5 billion – is part of around a $30 billion investment that will be made here in the building of this facility. And, as I say, I really want to thank our partnership with the South Australian Government for the way in which they have operated with us in the delivery of this. But most of all, I really want to thank the more than a thousand workers now, but thousands to come, who will be building this facility. They should be incredibly proud of what they are doing, and the outcome of this will really be the pride of the nation. 

PETER MALINAUSKAS, PREMIER OF SOUTH AUSTRALIA: Thanks, Deputy Prime Minister. It’s great to have you back here in Adelaide again. Very grateful for the leadership that Richard has shown over sustained periods over the AUKUS program more broadly, and it’s great to see it come to life in this facility. I also want to thank Pat Conroy. I was with Pat only a couple of days ago at the Lot 14 site immediately adjacent to Adelaide University, which will be home to many of the people that will be responsible for work associated with the AUKUS program for not a too long period of time. And I know Pat has been a regular visitor, as Richard has, over recent months and recent years. And I thank Pat for his hard work, as well as Chris, who has been down here at Osborne basically every second day since our state election when we become our Minister for Defence and Space Industry, along with Cheyne Rich, who’s the local MP and gets to drive past here literally every single day seeing this come to life. Today, the Federal Government announces another $4.6 billion cash injection to this $30 billion project. We stood down here in February and revealed the full-scale plan for the Osborne yard for the purposes of AUKUS – a $30 billion investment. And now we see that money translating from a number on a piece of paper to real facilities. Let’s just put this in a bit of context. Today is $4.6 billion. A couple of months ago, it was $3.9 billion as part of a $30 billion program. That’s 15 Royal Adelaide Hospitals – 15 Royal Adelaide Hospitals. Look at the size of this thing. This is the small parts workshop. This is the small parts workshop. Imagine what the big parts workshop looks like. So what South Australians are now starting to get a sense of is the raw scale of the size of this program, and this is just the construction yard to be able to build the most complex machines that have ever been built in the history of our country. And it will change the game forever in terms of the way that our state economy operates because people being born today in South Australia will have the opportunity to have some of the most advanced technical skills that you could possibly comprehend to set them up for life or future jobs, and then their children and then their children will get the same opportunities, which is why we are so excited about this as a state government. The facilities that we see being brought to life today are exclusively because of Federal Government investment. And they’re investments that the Commonwealth is making for the security of our nation. They don’t make these investments for the sake of the South Australian economy – which is doing just fine; they’re making these investments for the security of our nation. And what that translates to is a massive economic opportunity to improve living standards in South Australia. And our responsibility as a state government is to make sure we’re investing in the skills and the training pipeline. As [inaudible] heard me talk enthusiastically about the Skills and Training Academy. As you go back over the brand new bridge which only recently opened, you go back over the brand new bridge to head back into metropolitan Adelaide, you’ll see the Skills and Training Academy coming to life. In two years’ time, there’s going to be a thousand young people getting trained up in it. And many of those people might even come from the technical colleges, eight of which we are now building in South Australia, to train young people up, to get the skills that will be required to build the submarines. And when you bring all of that together, you get a program that’s going to improve living standards in South Australia.  One of our ambitions as a state government is to see the gap in average weekly earnings in South Australia catch up to the national average. We’ve already closed that gap to – by more than half in the space of four years we’ve been in government. Programs like this one will bring us in line, which means that South Australians’ living standards are improving, which is the main game from our perspective. So I can’t thank Richard and Pat and Andrew and the team at the ANI, Alex and the team at ASC and BAE and ASA for all of the work that goes into this. We know it just doesn’t happen. But I, you know, to be frank, I have been impatient over the last few years to be able to see what has been a proposition turn into something practical. And now to see that happening is exceptionally exciting, and we’re only at the beginning. I make this point again before I hand over to Pat: we are standing in one of the biggest buildings in the state, and this is going to be the small parts workshop for the submarine. So, this is just beginning, and there’s lots to be excited about. 

PAT CONROY, MINISTER FOR DEFENCE INDUSTRY: Thanks, Premier. It’s a pleasure to be here. And to everyone out there, to all the naysayers who say that AUKUS isn’t real, AUKUS is well and truly real, and it’s happening right now, right here in South Australia. What you’re seeing is the practical manifestation of the Albanese Labor government’s investment in defending our country, making it safer and delivering a defence future made in Australia. This precinct, the submarine construction yard, when complete, will be 10 times the size of the BAE Hunter construction facilities over there to give you an idea of the scale. Just over there will be a fabrication shed 400 metres long, which will be incredible for this nation to see. As the DPM has already said, we’ve already got 1100 workers working in this project right now as a down payment for the over 10,000 South Australians working in AUKUS long term.  So AUKUS is real. AUKUS is happening. The work has begun in preparation for cutting steel later in the decade. This is all part of our broader investment in the South Australian defence industry. Employment in the South Australian defence industry since we came to government has increased by 40 per cent – 40 per cent. And that’s before we get for AUKUS really kicking in later in the decade, so you can understand the scale of the South Australian defence industry. And as the Premier said, this isn’t just about jobs – although that’s obviously critical, giving people a future – it’s about defending the nation. We cannot have an Australian Defence Force without an Australian defence industry. And this is critical to our sovereignty and self-reliance. And that’s why I’m so grateful for the work that the women and men of the Australian defence industry do every day. But to do this, we need to train them. We won’t be poaching from other industries; we’ll be training young Australians to fill all these jobs. And as the Premier said, as you exit, you’ll see the Skills and Training Academy appearing before your eyes. The first intake will come in in quarter 1 2028. Every year 1000 South Australians will be trained there. And they’ll be part of a pipeline. On Tuesday, the Premier and I met some great young kids from Findon Technical High School who, all going well, with then flow through to the Skills and Training Academy and then flow through to sites like this. These kids will have jobs for life, making this country safer. And that’s what this is all about – making the country safer, giving families a future, giving economies a future at the same time. So, it’s a great pleasure to see it taking shape right here, right now. 

CHRIS PICTON, MINISTER FOR DEFENCE AND SPACE INDUSTRIES OF SOUTH AUSTRALIA: I think even South Australians who are following this closely will be surprised at how much is happening here at Osborne already. As Pat said, AUKUS is real, AUKUS is happening. It’s massive, and it’s happening right now. And there’s so much more to come. Standing here in this hall, which is going to be dwarfed by some of the buildings yet to come, you see the scale of this project and work that’s underway. So, thank you to the Deputy Prime Minister and Minister Conroy for their work in this latest injection into ANI. It enables the work to keep going. It enables more people to be hired. 1100 people already working on this site, but that’s going to grow to 4000. And the state government, we are in lockstep with the federal government of delivering this project, of making sure that we can have this here in South Australia to deliver generational economic benefit for South Australia but, importantly, the nation’s capability that we need to defend ourselves for generations to come. 

JOURNALIST: Deputy Prime Minister – 4.6 today. Are you confident that that will be enough money to get this facility done, or is it likely more will need to be put in as construction costs increase? 

MARLES: Well, we're confident around the number of 30 billion, so that's the size of the project. This is going to be built in stages, and that's so that we can get building of the submarine up and running as quickly as possible. But the $3.9 [billion] that we announced in February, the $4.6 [billion] that we're announcing today, is the money required to get this to happening. You can see it literally happening right before your eyes, and the progress here is really staggering in terms of how quickly it's occurring. Now, we're working to a timeline of seeing steel cut on the first of the submarines by the end of this decade. That's kind of the key milestone. We're really confident of being able to achieve that, and we're confident that we've got the funds behind this to achieve it.

JOURNALIST: Minister, you've timed this announcement with the Labor Party conference. As investment increases in AUKUS, and therefore the cost to the taxpayer, how confident are you that the anti-AUKUS elements of the Labor Party will keep quiet?

MARLES: Well, firstly, people have a right to have their say, but I guess what I remind people of is that three years ago, at the National Conference in Brisbane, we had a full-throated debate around AUKUS. You know, that was months in the building. It was the signature debate of that conference, and the outcome wasn't close. It was about 75% on the floor supporting AUKUS, so the statement of support by the party itself for the AUKUS program has been utterly clear and overwhelming, and that remains the case. And, of course, from the government's point of view, we are implementing that. As many have said, AUKUS is happening, and right now there are 1,100 construction workers on this site building this facility. But if you look at others who are involved in the AUKUS program, I mean, in terms of ongoing jobs, submariners, people in Pearl Harbor right now are getting the skills on working with nuclear-powered submarines who will come back to Australia with those skills. There's more than 1,000 right now in that category. So there are 1,000s of people working on this project today, and that only goes further. And I think everyone within the Labor Party understands the significant economic benefit which is associated with this, not to speak of what is ultimately the objective here, which is the biggest leap in our military capability that we will have had since the establishment of the Navy. We are the party of the Australian project. We understand the significance of having a highly capable, strong defence force to maximise Australia's sovereignty — that's what the Labor Party has always been about, and that is very much the centre of the Labor Party's today.

JOURNALIST: Minister, a number of Chinese diplomats appeared to walk out of Labor's conference yesterday after complaining about the presence of Taiwanese officials at conference. Just on that, are Taiwanese officials welcome at Labor's conference, and were the actions of those Chinese diplomats appropriate?

MARLES: Well, look, we run a program for international guests to observe our conference. That's how we've done this conference, in accordance with the procedures that we've adopted in conferences past. You know, it's a significant event in terms of the Australian political landscape, but we want it to be as transparent as possible for international observers to be able to see that. And we'll continue to operate the conference in that way. And I really wouldn’t add much more to it than that. 

JOURNALIST: (inaudible)

MARLES: Well, there's no doubt about the UK's commitment to AUKUS. Our Prime Minister spoke with the UK Prime Minister yesterday. I'm hoping that's public that they did have that conversation. I'm yet to speak with my counterpart, but I will very shortly. But, of course, my former counterpart, John Healey, who's an ardent supporter of AUKUS, is now the Chancellor of the Exchequer of the Burnham Government. The UK have been really critical partners in ensuring AUKUS happens, and they have made a massive strategic decision to have the successor to their current Astute-class submarine, their attack-class submarine to be a class of submarine that we operate jointly, a class of submarine that could be built at Barrow, and a class of submarine that could be built right here at Osborne. And the sharing of the risk associated with having two production lines — one right here where we're standing and one at Barrow — building the same class of submarine is enormously important for the United Kingdom, as of course it is for us. So we're really confident about the UK's ongoing support with AUKUS. 

JOURNALIST: (inaudible)

MARLES: Well, I mean, we have a very good relationship with the Trump administration and that will continue irrespective of how this plays out. But let me be really clear. Firstly, we are making the argument very forcefully and loudly that we believe in an open global trading system and, specifically in terms of our bilateral relationship with the United States, we want to see less tariffs rather than more. The U.S.-Australia Free Trade Agreement has been enormously beneficial to jobs in the United States, as it has been for jobs here in Australia, and we will continue to make that argument very clearly to the United States. Now, they have grounded this decision in respect of seeking to act on the question of modern slavery and forced labour around the world. I mean, we share an objective there to stamp that out, but we would also make clear that the legal regime that we have in Australia, in respect of forced labour, is amongst the best legal regimes that exist in the world today, and we're making that point very clearly to the Trump administration as well. 

JOURNALIST: (inaudible)

MARLES: Well, it hasn't changed my view about it in the sense that you know my view, but our view as a government is that we face a very challenging, in many respects threatening, strategic environment. In our rational world, defence spending is a function of strategic threat, and we are rational people, and that's why what you are seeing is the biggest peacetime increase in Australia's defence spending in our nation's history, and that happened well before this specific missile test. We see that we are living in a challenging world, and that is why we need to be building Australia's defence capability, and that's why we've committed so much money to that.

JOURNALIST: (inaudiable)

MARLES: Well, we have increased defence spending —

JOURNALIST: (inaudible)

MARLES: Well, I mean, we've increased defence spending, and you've seen us, in four different iterations, literally over the last four years, significant injections of funding into the 10-year funding schedule for defence between 3, 4, 5 and 6 each of the last 4 years, and so that is a really significant increase in Australia's defence spending. Right now, we're at 2.8% of GDP. That puts us ahead of most countries in NATO. We're ahead of Germany, France, Italy, Great Britain. We are ahead of our like-minded partners in the Indo-Pacific. So it is a significant commitment to defence spending, and we will continue to respond to the strategic circumstances that we face.

JOURNALIST: Minister, there are reports that a star-ranked naval officer is facing serious charges related to defence contracts at Henderson. What can you tell us about that case? Is it appropriate it's being heard before a court martial, a military tribunal, rather than a civilian court?

MARLES: Well, the answer to the second question is that it is appropriate, but because this is now in a legal process, there's not much I can really add to this in a public way. We now let those processes play out.

JOURNALIST: Are you alarmed by the accusations at least?

MARLES: I mean, I think we need to let those processes play out. The court martial is a legal process, and so it's important that play out. I think that should play out without commentary.

JOURNALIST: On another matter, The Sydney Morning Herald this morning reported that the Prime Minister attended an exclusive dinner with Felix Lee, the son of Philip Dong Fang Lee, and that he's promised a $1 million donation to the Labor Party. The Tax Office has accused Philip Lee of repeatedly deceiving authorities to funnel huge sums of money from China into Australian bank accounts. Who arranged (inaudible)?

MARLES: Look, I mean, I think there's been responses to this already. I mean, the only thing I would make clear here is that, in terms of any donation and all donations that have been made to the Labor Party, we declare them in a full and appropriate way.

JOURNALIST: What does it say about Labor that they are accepting donations from someone who made (inaudible)?

MARLES: Well, I mean, I'm seeking not to engage with your question in that sense. I mean, others have already responded to this. The important point to make here is that we fully disclose and appropriately disclose all the donations that we receive.

JOURNALIST: Premier, protests are currently going on outside the convention centre. Some of them are Port Adelaide locals who are against AUKUS and feel like they're bearing the brunt of this project. What's your message to them?

MALINAUSKAS: I think the overwhelming majority of people who live in metropolitan Adelaide, including the Lefevre Peninsula, understand the extraordinary economic opportunity. I, along with the local MP, Cheyne, have spent a lot of time on the Lefevre Peninsula, and the families I speak to are excited about the fact that there are going to be really good, long-term, well-paid jobs around the corner from where they live. And that hasn't always been true in this part of the world, and that's where the majority of the segregate is. Obviously, the size and the scale of the investment here mean that the way the Lefevre Peninsula operates has been changing, and that's why you see the requisite investments. The link road you see here, for instance, is all about making sure that as this facility grows, traffic movement is being invested in as well. That will remain to be true for as long as the program exists.

ENDS