Julian Kerr | Sydney

Exchanges in the Senate References Committee have made it clear the government has no intention of amending the terms of the Request for Tender (RfT) for the Sea 5000 Future Frigate program to mandate the inclusion of an Australian shipbuilder.

This means the winner among the three shortlisted international contenders for the $35 billion program will retain responsibility for the construction – albeit in Australia – of its proposed Future Frigate design.

The three competing designs comprise a version of the Type 26 Global Combat Ship offered by the UK’s BAE Systems, a modified F-100 design proposed by Spanish shipbuilder Navantia, and a derivative of the Carlo Bergamini-class variant of the FREMM multi-mission frigate offered by Fincantieri of Italy.

At the committee’s 8 September hearing into the future sustainability of Australia’s naval shipbuilding industry, Labor Senator Kim Carr quoted Clause D of the RfT as stating “The successful tenderer will not be directed to utilise any particular shipbuilding workforce or engage any particular provider of shipbuilding services. In particular, the Commonwealth is not mandating that the successful tenderer use the workforce of ASC.”

Independent Senator Nick Xenophon earlier quoted a passage stating the Commonwealth’s intention “that the successful tenderer will directly manage and supervise the workforce undertaking shipbuilding work. The responsibility for build management and supervision should not be subcontracted in its entirety to a third party entity”.

Both Austal CEO David Singleton and ASC Shipbuilding CEO Mark Lamarre told the committee that meaningful engagement with the contenders had ended after the RfT’s release on 31 March. Three months later the two companies entered a teaming arrangement for Future Frigate construction.

Responding to questions from Senator Carr, Department of Defence Associate Secretary Brendan Sargeant confirmed that CASG head Kim Gillis had subsequently telephoned the three contenders.

“Austal and ASC were making statements about their desire to participate in the (RfT) process,” Sargeant said.

“It may be that people thought the Government was making a decision to change that process and the communications with the companies were to ensure that they understood that the process as designed would proceed.”

Asked if the change in attitude of the preferred tenders to Austal and ASC had anything to do with Gillis’s telephone call, Sargeant responded “I have no idea. That would be speculation on my part and I don’t think it’s appropriate for me to talk about how tenderers might approach their commercial relationships.”

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