Greg Combet (Charlton, Australian Labor Party, Parliamentary Secretary for Defence Procurement) Share this | Link to this | Hansard source

As members of the House would be aware, a number of defence procurement projects have received extensive media coverage in recent months. In my role as Parliamentary Secretary for Defence Procurement, the Minister for Defence commissioned me to review a number of projects that have suffered from a delay in schedule and/or increases in cost. At the top of my list for these reviews was the $1.3 billion Super Seasprite helicopter project. There are others on the list, including the guided missile frigates, or FFG, upgrade, which is now almost five years late.

In reviewing the FFG upgrade, I have been struck by the lack of direction provided by the Howard government in these important areas of government expenditure. Despite the frigates project being notoriously complex, and receiving wide media attention and parliamentary scrutiny, the previous government appears to have failed to get across the detail. What I found in my review of the project was that there was a fundamental lack of government direction and supervision of projects like this. By providing that direction in relation to the FFG upgrade and aiding the communication flow between the prime contractor, the subcontractor, the Navy and the Defence Materiel Organisation, I am now hopeful that progress on the project can be made.

The same lack of direction and supervision by the Howard government was evident in the review of the Seasprite helicopter project. On 5 March the Minister for Defence announced the Rudd government’s decision to cancel the Seasprite helicopter project, which had been due to deliver 11 helicopters to the Navy by 2001. Seven years later not a single helicopter was operational—seven years after the due date not a single helicopter was operational. Around $1.3 billion of taxpayers’ money had been spent by the Howard government for no result. In my experience, there is no doubt that there were many good people who worked on this project and did their utmost to bring it to fruition. I know that many in the Defence Materiel Organisation have done whatever they could to bring the project to successful completion.

But what seems to have escaped sufficient scrutiny is the pathetic performance of the former Howard government in its decision making and monitoring of the project. We are aware now that the current opposition leader and former Minister for Defence, Dr Nelson, recommended to the Howard government in May last year that the project be cancelled. That was the right recommendation, but the fact was that he lacked the authority to carry the argument with his colleagues. This point is very important: despite $1 billion having been expended for no result and with little prospect of a result forthcoming—and acting on the same advice, facts and figures that the Rudd government now has available to it—the Howard government rolled its own defence minister and ploughed on, spending taxpayers’ funds. The other senior ministers involved at the time rolled Brendan Nelson and kept spending taxpayers’ money on a project with very little chance of success.

One of those who rolled him, we assume, is the current shadow defence minister and then finance minister, Senator Minchin. The interesting thing about Senator Minchin’s involvement is that he now thinks the decision to cancel the Seasprite helicopter project is the right decision. What a rabble we are dealing with here—a defence minister who lacked the authority to carry a recommendation through and a finance minister who supported the project less than 12 months ago and now thinks it is the right decision to cancel it when nothing substantially has changed in that time. They knew, I think, that they should have cancelled the project at the latest by May last year, but they kept going and, in the process, a further $26 million of taxpayers’ funds has been wasted. And I think we all know why that money was expended. It was for purely political purposes. It was an election year, with the Howard government increasingly on the nose, and they did not want to own up to a fundamental failure in this procurement area and the incredible fact that $1.3 billion of taxpayers’ money had been lost.

Just imagine what could have been done with that money in the areas of health and education, skills development or infrastructure investment. I think the former government and Dr Nelson, and Senator Minchin in particular, have a fair degree of explaining to do. They have to explain why the monitoring of that project was so incompetent. And they must explain why they failed to make the right decision in May last year. (Time expired)