The Ai Group Defence Council, the peak body for the Australian defence industry, says Australian industry has the capability, capacity and determination to meet the Naval Shipbuilding Plan challenge.
The Ai Group Defence Council has called for greater recognition of these local capabilities, as well as a more considered debate focussing on a national approach to further building that capability and delivering outcomes. These are more substantial considerations than a simple focus on specific local content targets.
“Australia’s industry is committed to delivering defence capability on time and on budget, using local capabilities and local workforce to the fullest possible extent,” Ai Group’s Chief Executive, Innes Willox, said.
“The Naval Shipbuilding Plan is larger and more complex than either the Snowy Hydro Scheme or the National Broadband Network. It is the largest, most complex and technically difficult manufacturing challenge Australia has attempted. We need all levels of Government, Defence and industry working together to successfully deliver these critical capabilities, using existing skills and creating new high-end jobs and opportunities across the country.
“There has been significant debate over State-based issues and the percentage of Australian industry content. We must take a national view of the Naval Shipbuilding Plan and the best way to incorporate Australian industry into supply chains. Focusing on local content percentages at too early a stage will not get the best results for Defence, industry, the workforce or taxpayers.
“The critical issue is for Defence to take a thorough and comprehensive view of Australia’s capability and industrial goals and objectives and match them to our competitive industrial and workforce capabilities now and as they develop over the shipbuilding program, which will last for decades.
“The continuous shipbuilding plan offers a once-in-a-generation opportunity for the Commonwealth to use its direct purchasing leverage to not only acquire the best capability in the world but also require the winning tenderers to transfer technology, create in-country capability and design expertise, and forge pathways to export that will deliver jobs and economic benefits for decades to come. These are the critical areas of focus for Australian industry.
“Once Australian involvement is agreed across systems, platforms and time, it should be rigorously enforced and industry will deliver.
“We should take confidence in the fact that Australian industry already has significant runs on the board across successful Defence programs and innovations, including exporting to the world. Australian industry was successful in the Anzac shipbuilding program and we can do it again.
"Recent results in the Air Warfare Destroyer program and sustainment of the Collins Class submarine demonstrate we can perform and deliver competitive results, particularly where there is program continuity.
“The Naval Shipbuilding Plan is too important to be derailed by simplistic approaches. Australian industry stands ready to deliver these capabilities which are so vital to our national and economic security,” Mr Willox said.
ADM Comment: Given the recent debate in government circles about the nature of ownership models in the shipbuilding industry (ASC and Austal in particular), this statement from Ai Group comes as no surprise. What did come as a surprise was that the original statement above did not mention the issue.
ADM asked Ai Group where they stood on the ownership issue.
“While there are considerable benefits regardless of whether a business is locally or foreign owned, the question of which generates greater benefits is a complex one with no simple general answer because there are various issues to consider such as access to global supply chains, the potential to expand Australian exports and the benefits of technology transfer and R&D," Willox explained to ADM.
“That’s why future defence investments should have a focus on the best way to incorporate Australian industry into supply chains. Top considerations should be how we can maximise the use and development of local capabilities and the local workforce, the transfer of technology and design expertise and export opportunities."
So does it matter which logo appears on the shirts of the workforce? That depends on who you talk to.