Richard Marles (Corio, Australian Labor Party, Shadow Minister for Defence) Share this | Hansard source

There is a happy bipartisanship at the moment in Australian politics around seeking to build an Australian defence industry in this country. Certainly, I acknowledge the minister spends a lot of his time, as he should, spruiking this, and the government's achievements in seeking to build an Australian defence industry. One of the prisms through which one can look, in trying to foster an Australian defence industry, is the attributes of successful defence industry companies around the world and the extent to which they are replicated in any Australian companies today.

If you look at big defence industry companies like BAE Systems; companies out of Israel, such as Elbit Systems and Rafael; and companies out of Sweden, such as Saab, you see companies which are largely export based—not deriving the majority of their business from their home defence force, if you like—and which employ thousands of people. These are big companies. When you think about what companies in Australia meet that set of criteria, there's one that particularly stands out and is a remarkable Australian story. It's Austal. Austal employs thousands of people around the world. Most of what it does is based on exports, particularly to the US Navy. It's responsible for designing and building 27 ships for the US Navy, including the littoral combat ship and a number of troop transport carriers. It's also built ships for the Omani navy and, I think, the Maltese navy, although I stand to be corrected on that, as well as doing a lot of civil construction. Right now, it's building a very large civil ferry for Denmark.

Austal has, at its base in Henderson, a very significant design capability—more than 100 naval designers, which would be the most significant naval design capability in Australia today. But it has not done particularly well in terms of being able to win work from the government. To be fair, it has won a contract to design the Pacific patrol vessel, but, most recently, in relation to the offshore patrol vessels, it was overlooked in relation to contributing to the design of that platform, notwithstanding that that platform is perhaps the best opportunity that we have in Australia today to have an export-based naval construction business. It leaves Austal in something of a quandary, because they are able to design and build ships—and very significant ships—for navies around the world, including the United States Navy, yet, in terms of winning work on our own Defence Force, it has not achieved a lot of success.

The most significant decision that the government's about to make in relation to naval shipbuilding is the announcement of the designer in the frigate program. The designers who are left in the competition are three overseas companies: BAE Systems, Fincantieri and Navantia. In addition to the design, there will need to be a solution around the build of this vessel, which will need to be arrived at by the government during the remainder of this year.

A few weeks ago I called on the government to ensure that the builder working with whoever is the successful designer is a truly Australian company—a company which has its design capability here, which has its intellectual property here, which represents a projection of Australia. It's absolutely essential, if we are to build a defence industry in this country, that surface shipbuilding is at the heart of it and that we have Australian companies right at the centre of that work.

There has been failure in this respect since 2013 under this coalition government. You only need to look at the supply ship being sent to Spain. Former defence minister Johnston said, in respect of the ASC, that they couldn't be trusted to build a canoe. We need to see a decision by this government that provides a platform for an Australian company to participate in the building of ships, and this frigate decision is going to be fundamental. My question is: can the minister absolutely assure us all here that there will be a truly Australian company involved in that shipbuilding?

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