The Senate enquiry into Australia’s sovereign naval shipbuilding capability has continued to receive submissions this week, notably from ASC and the SA government.
The enquiry is investigating the delivery and development of sovereign shipbuilding, including oversight of the national shipbuilding plan, progress in procurement projects, progress in building a workforce, implementation of Australian Industrial Capability (AIC), intellectual property transfer, and more.
The SA government’s submission highlights the need for a common understanding of what AIC actually is.
“Shipbuilding supply chains can contribute by some estimates as high as two to three times the economic impact of the shipyard itself,” the SA government submission notes. “The Australian Government’s investment into shipyards will dictate local content to some extent, however, without similar investment into the supply chain and a commitment to support local defence industry, the nation will not achieve its goals of sovereign capability and be a leading defence exporter.
“An unambiguous definition of what is classed as local content and supply chain is needed.”
SA also points out that prime contractors have Tier 1, 2 and 3 preferred overseas suppliers that collaborate well on programs, but come with risks for Australia – including the fact that Australian taxpayer money is helping create a future competitor in the global market.
The state is also evidently concerned about workforce shortages.
“SA needs on-going access to the Naval Shipbuilding College’s workforce demand projections to set, monitor and adjust as necessary targets for education, training and migration,” the SA submission said.
ASC, Australia’s largest locally owned defence contractor, outlined lessons it has learned from the Collins class program and advocated for an enterprise approach to the on-going Collins and Attack class programs.
“ASC’s history and future may be viewed against the backdrop of Australia’s unique defence industrial model, characterised by modest industrial size and a limited number of defence technology suppliers and developers, most of which originate from offshore countries,” ASC said. “As a consequence, with notable exceptions, Australia’s defence industry has been a technology aggregator, not a developer.
“ASC believes that an enterprise approach to Australia’s two submarine programs – the Collins and Attack classes – will best ensure that Australia’s continues to achieve a sovereign, regionally superior submarine capability today and into the future.
“ASC believes it was a positive step for the government to include Attack Class prime contractors Naval Group and Lockheed Martin in the regular meetings of the Submarine Enterprise Board.”
The BAE/ASC Shipbuilding submission, meanwhile, confirmed that the Hunter class frigate build and Osborne South Naval Shipyard redevelopment are both on schedule, with the program set to move into the shipyard around the middle of the year.
BAE/ASC Shipbuilding’s submission takes a slightly different tack to SA, noting significant investments in Australian supply chains and the transfer of intellectual property from the UK to Australia through expatriate personnel in both countries.
“Our success will be determined not only by the design, construction and delivery of nine anti-submarine warfare frigates, but on our contribution to growing and sustaining a sovereign capability with the aim of independently designing and building the next generation of complex warships in Australia,” the submission said.
It also estimates that the Hunter program will contribute $1 billion in GDP by 2028, with a total of $17 billion in GDP over the life of the Hunter class build.
All submissions are available here.