Defence is withholding more and more information from the Australian National Audit Office (ANAO) Major Project Report (MPR), justifying that on a need for secrecy in these uncertain times.
As it did in the 2021-22 MPR, Defence again declined to publicly disclose some information in the 2022-23 MPR relating to forecast dates, capability delivery and variance information on 12 of the 20 projects.
In the 2021-22 MPR, Defence declined to publicly disclose data on four of 20 projects.
“Defence has assessed that some details, both in respect of individual projects and in aggregate, would or could reasonably be expected to cause damage to the security, defence or international relations of the Commonwealth without sanitisation of the data,” said acting Defence Department Secretary Matt Yannopolous.
For the largest project, acquisition of Lockheed Martin F-35 Joint Strike Fighters through Project Air 6000 Phase 2A/2B, data withheld relates to Final Materiel Release (FMR), Final Operational Capability (FOC), post-FOC capability, milestone dates and variance information.
Much the same data has been withheld for Peregrine (Air 555 Phase 1), Jindalee Operational Radar Network Mid-Life Upgrade (Air 2025 Phase 6) and Growler upgrade (Air 5349 Phase 6), with the addition excision of jammer information and weapons quantities. And so on.
Total approved budget for the 20 Major Projects included in the 2022-23 MPR is $58.6 billion, 30.8 per cent of the total $190 billion budget for Defence’s major and minor acquisition projects.
Project Data Summary Sheets (PDSS) included in the MPR can provide useful information on project performance including progress, with all the figures added together to indicate global schedule slippage.
No such data was available for the 2021-22 MPR but in the 2020-21 MPR, total schedule slippage was 405 months across the 21 projects examined.
For the 20 projects in the 2022-23 MPR, Defence declined to provide data on delays for the eight projects but did reveal global schedule slippage of 453 months, a 23 per cent increase since Second Pass Approval.
Average schedule slippage was 25 months and in-year schedule slippage totalled 101 months, as against 73 months in 2020–21. Total budget is $58.6 billion.
“Delivering Major Projects on schedule continues to present challenges for Defence. Schedule slippage can affect when the capability is made available for operational release and deployment by the ADF, as well as the cost of delivery,” ANAO said.
That certainly indicates Defence still has much work ahead to achieve Defence Strategic Review aspirations for a more efficient acquisition process, essential in this era of strategic uncertainty and reduced warning times.
The impact of the Covid 19 pandemic continues to be felt, with three projects reporting impacts across multiple domains of cost, schedule and capability.
Here’s what the MPR had to say about a few of the projects:
- Sea 5000 Phase 1 Hunter-class frigates: The ANAO says there are significant risks and challenges, as would be expected for a project of this complexity, but it remains on track to commence Ship One construction in Quarter Two this year. The plan is to construct nine frigates configured for anti-submarine warfare but that number could be altered as a result of the review of the Navy’s surface warships.
- Sea 1180 Phase 1 Offshore Patrol Vessels: Twelve are to be delivered with two launched and four more under construction. But delivery has been delayed after Defence identified changes required to improve structural fire protection of the ship and to address other safety issues.
- Air 2025 Phase 6: Jindalee Operational Radar Network (JORN) mid-life upgrade. This is a complex project featuring wholly Australian technology which is taking longer and costing more than anticipated. Budget is now $1.288 billion, up from $1.117 billion at second pass. ANAO said since implementing an Alternate Delivery Strategy in late 2021, the project has been delivering ahead of contracted dates.
- Land 907 Phase 2 and Land 8160 Phase 1 Heavy Armour Capability: The Army is to acquire 75 M1A2 Abrams SEPv3 Main Battle Tanks and 52 assorted engineering and recovery vehicles. Other than training systems developed by Australian industry, this is an acquisition wholly through US FMS. It remains on track to deliver on time, though Defence isn’t saying when.
- Air 6000 Phase 2A/2B F-35A Joint Strike Fighter: The ANAO said 63 of 72 aircraft had been delivered as at October last year, with new deliveries delayed for a major systems upgrade. Final operational capability, initially scheduled for end of 2023, will now occur later this year when the RAAF fully stands up three operational squadrons and a training squadron.
- Air 9000 Phases 2, 4 and 6 MRH-90 Taipan helicopters: The Taipans are being replaced by a fleet of 40 UH-60M Black Hawks, with the aircraft dismantled and their parts sold off. Under the circumstances, Defence was happy to disclose full details of delays. Final operational capability, never achieved, was scheduled for July 2014. Final materiel release was scheduled for October 2014 and achieved in September 2023, almost nine years late.
- Air 5349 Phase 6 Advanced Growler Airborne Electronic Attack Upgrade: This is a $3.2 billion project to equip RAAF Growlers with a suite of modern jammers, improved sensors and new anti-radiation missiles. This aligns with the US Navy upgrade of its Growlers. ANAO says there are risks but it’s proceeding on schedule.