The fifth annual ADM Defence Estate and Base Services Summit was held in Canberra on September 21, attracting delegates from across Defence, government and industry. The event this year was the biggest ever, with over 250 people attending the one-day conference.
Chaired by Laing O’Rourke’s Michael Rinaudo, the summit provided an opportunity for stakeholders in the estate and infrastructure space to discuss problems and share ideas on how to provide Defence with the best return on the four billion dollars it spends annually on upgrading, sustaining and supporting bases to enable Defence capability.
The opening keynote address at the 2016 conference was delivered by Steve Grzeskowiak, Deputy Secretary, Estate and Infrastructure Group (E&IG).
“This is a great opportunity for me to talk about what’s going on in Defence as I see it, it is about how we deliver services to the ADF,” he told delegates. “Everything we do is about delivering capability outcomes for Government.”Grzeskowiak noted that the majority of what E&IG does is heavily outsourced to industry and in response to the First Principles Review, he said there was a genuine desire to look further into what industry could provide in the future.
“Why do we do some of the things that we do when industry could do them better?” he asked.
The soon to be released Defence Estate Strategy is a further key response to the FPR and Grzeskowiak said that one of the strategies of the document will be the Future Estate Profile, which will consider a long-term view of what estate profile Defence should adopt to meet the ADF’s future capability needs.
“It is going to guide the decisions we make in our estate world over the next few years,” he added.
From a budget perspective, he noted that $26 billion will be spent on Capital Expenditure over the next decade, a nine billion dollar increase over funding in the previous budget.
“The majority of that will be spent by industry on our behalf,” he said.
The Estate and Infrastructure group has recently been reorganised and the heads of each of the new divisions, Alice Jones, First Assistant Secretary Estate Services and Chris Birrer, First Assistant Secretary, Infrastructure also delivered keynote addresses at the summit.
Birrer noted that about $1 billion is spent annually on Defence capital facilities and infrastructure projects in Australia and that the figure will significantly increase in the future. “That’s a challenge for both you and us, in terms of actually delivering the projects as committed to by the Government,” he told industry representatives.
He also noted that in the White Paper, the Government had very much committed to further investment in Defence infrastructure in northern Australia and in particular the NT.
“There will be long term options to look at Defence’s footprint in the north, including the development of a northern Joint training area for large-scale Joint and amphibious training,” he said.
In terms of industry engagement overall, he said his organisation was very much interested in continuing the focus on building more effective and collaborative working relationships.
“We will continue to listen to you and talk to you and look at some new ways of working together as we move forward.”
Alice Jones spoke about the introduction of the innovative contracting model for Base Services contracts and also the move towards a contractor and subcontractor model, whereby one contractor integrates services for all other contractors.
“The contracts have been strategically bundled in response to feedback from industry. In relation to innovation, Defence also made continuous efforts to both capture and capitalise on innovations introduced in the Base Services contract environment, through the introduction of much more comprehensive intellectual property management and contract clauses,” she said.
“These clauses were introduced with the intent of providing the framework through which innovation or best practice ideas could be implemented by one contractor and then introduced across the entire Defence estate. This will provide the customer and the consumer with a consistent best practice experience.”
Industry Keynote Address
Leading the presentations from industry was a keynote address from Martin Sheppard, CEO of Spotless, on partnering with Defence on innovation.
Sheppard noted that the traditional models of both Government and business have been very hierarchical, but the model has now been inverted and the management role is to capture a broad base of ideas from within the organisation. He provided case studies around progressive and successful businesses such as Uber and Airbnb, which have challenged established thinking.
“The ideas and initiatives and in effect the strategy is, in the progressive businesses, now built from the bottom,” he said. “There’s probably a bigger challenge around innovation for a hierarchical structure.”
The international keynote address was given by RADM (Ret) Gary Engle and Wesley Ishuzu from AECOM, who shared their experiences of working for the US Navy on a range of infrastructure development and relocation projects in the Pacific.
Although keen to note they were not speaking for the US Navy, the pair provided insight into some of the lessons which may have relevance to Defence, as it seeks to develop infrastructure to support Navy operations in the future.
“We see some great parallels around how you are going to develop the guiding principles needed to develop the infrastructure,” Ishuzu said. “There are tremendous opportunities to come and AECOM would love to continue to provide assistance to Defence, based on our experience in this area.”
Lawyers Cate Greene from Clayton Utz and Richard Morrison from Sparke Helmore delivered an entertaining presentation on the Integrated Project Delivery suite of documents which, although carried out in a humorous ‘interview’ fashion, in the style of the ABC’s Clarke & Doyle, provided a detailed explanation of the processes required if industry wishes to bid for work.
Arguably the loudest applause was reserved for the final speaker, Mark Coleman, CEO of Pacific Services Group Holdings, who provided a compelling insight into why it is beneficial for Defence and industry to mentor indigenous businesses.
Note: ADM would like to thank the platinum sponsor for the 2016 iteration of the popular event, namely Laing O’Rourke, and also AECOM, Aurecon, Jacobs and Fulton Hogan for providing gold level support.