With the election looming, Defence Industry Minister Pat Conroy has urged the Coalition to match Labor’s defence budget so that defence doesn’t become an election campaign football.
That’s looking less likely, with Opposition Defence spokesman Andrew Hastie promising more funding and accusing Labor of lack of leadership and of starving defence small and medium enterprises of funding.
Both spoke at the ADM Congress in Canberra last Wednesday, perhaps the last public defence industry forum before the election.
Minister Conroy stood by Labor’s record.
Despite a perception that the defence industry was languishing, with spending directed to big primes and acquiring nuclear submarines, the minister said acquisition spending was up 16 per cent to a record $16.7 billion while sustainment spending was up 12 per cent to $16.3 billion.
“We’ve spent record amounts in the Defence industry, $22 billion in the last year. We’re upping that spending. More importantly than the money we’re spending, we’re taking concrete initiatives to make sure that money flows through,” he said.
“Last year, we signed more than 19,000 contracts worth $26.1 billion with Australian industry, up by more than 12 per cent on the previous year.”
“This government is committed to giving the Australian Defence Force the equipment it needs to defend this country and we are committed to maximising the scheme in Australia to develop and sustain a sovereign and independent Australian defence industry.”
The government had initiated the Defence Strategic Review, National Defence Strategy and the 2024 Integrated Investment Program and Surface Fleet Review, shaping the ADF for existing strategic circumstances and setting the defence funding trajectory.
Mr Conroy said the government had brought forward acquisition of Tomahawks, SM-2 and SM-6 and HIMARS missiles and medium and heavy landing craft.
“We brought forward missile manufacture by 10 years. The frigates are the poster child. Under the previous plan, one new frigate by 2034. Under our plan, four new frigates by 2034,” he said.
Mr Conroy said none of this could be achieved without funding continuity.
“The last thing I want to see is for Defence to be a political football in the upcoming election,” he said.
He rejected coalition claims that defence funding was not keeping up with inflation and accused the Opposition of planning to cut the Defence budget by $50 billion, citing coalition frontbenchers as saying they planned to keep defence spending at the 2022 trajectory and would seek efficiencies across the public sector including Defence.
“I don’t want Defence, quite frankly, to be a political debating piece in the election and the best way of doing that is to have both sides of politics having the same funding commitments, and at the moment one side is not committed to that extra funding to get Defence over 2.3 per cent of GDP,” the Minister said.
With polls showing Labor the Coalition neck and neck, Andrew Hastie has a better than outside chance of becoming the next defence minister in a Peter Dutton government.
That would place him in the front row of Australian politicians dealing with the Trump administration, for which he’s been reading up on Trump-related literature such as Peter Navarro’s “The new MAGA deal - The Unofficial Deplorables Guide to Donald Trump's 2024 Policy Platform.”
Navarro is Trump’s senior counsellor for trade and manufacturing.
Mr Hastie said in his book, Navarro made it clear where a second Trump administration was headed - tariffs coupled with aggressive supply side domestic economics to recover American prosperity and manufacturing.
Mr Hastie said Australia was already facing economic challenges from the US with the announcement of tariffs on Australian steel and aluminium.
“It’s an economic challenge that poses both risk and opportunities for our Australian defence industrial base. To be best positioned to meet that challenge we need to understand what is going on and respond in a rational manner,” he said.
“Hyperventilating will get us nowhere. Nor will pejorative social media posts about President Trump,” he said.
“We must try to understand the underlying logic of what is happening in the Trump administration.”
Mr Hastie he was here to talk about the urgent task of rebuilding Australia’s sovereign defence industrial base.
“Under the Albanese government the economic conditions are hostile. Inflation is sticky. Productivity is down. Our energy costs are at record highs and the labour market is tight.
“And there isn’t any new money coming from the Albanese government. There is no signal that they are backing our local defence businesses. Our defence industrial base is leaderless. In fact, the Albanese government is starving our defence small and medium enterprises of funding.
“Indeed, the Albanese Government is doing its best to channel the spirit of Ebenezer Scrooge with its tiny commitment of $5.7 billion over the forward estimates.
“Let’s be clear. The task requires political leadership. The task requires drive and vision. The task requires a close partnership between the Australian government and our private sector. And we’re not seeing any of those things under Labor.”
Mr Hastie denied a coalition government would cut defence spending.
“I’ve already made a commitment publicly over the last 18 months, two years, that we would spend more in defence than Labor,” he said.
“I think the baseline of two per cent (of GDP on defence) is too low. It’s clear that the US administration is asking European allies to go up to five per cent. It’s just a matter of time before we get pushed publicly on our GDP.”