Chris Evans (WA, Australian Labor Party, Leader of the Government in the Senate) Share this | Hansard source

The Minister for Defence has provided the following answer to the honourable senator's question:

(1) Please refer to the 19 October 2011 Supplementary Budget Estimates Question on Notice 17 for a full list of meetings, dates, locations and attendees.

(2) As stated in the 29 June 2011 Ministerial Media Release on reforms to the Projects of Concern system, the Minister for Defence Materiel conducts the Projects of Concern summits with Defence and company representatives to ensure individuals are being held to account for the progress of remediation efforts. Discussions at the summit cover all aspects of project activity and remediation, and are commercial in confidence.

(3) As also stated in the June Media Release, an action from each meeting is for the Defence Materiel Organisation (DMO) and company to update the project's remediation plan. This plan identifies remediation objectives, milestones, and project actions over the following six months, as well as the agreed basis for removal from the Projects of Concern list. All actions are assigned to an individual, accountable officer from Defence or the company. Remediation plans are commercial in confidence.

(4) The meetings are not held in an open forum. Attendance at each meeting is restricted to Defence and company representatives directly involved in the project. This allows commercially sensitive activities and contract obligations to be discussed freely.

(5) The discussions have no direct legal effect. However, agreements made at a summit meeting can lead to a contract amendment.

(6) As advised in the June Media Release, the Independent Project Performance Office (IPPO) began operating on 1 July 2011. The Projects of Concern Directorate is now part of the IPPO Branch within DMO.

(7) (a) The total project cost to install the Anti-Ship Missile Defence upgrade in all eight ANZAC frigates is in excess of $650 million, including the funds already spent on upgrading HMAS Perth.

(7) (b) The final system will be installed in the eighth ship in 2017.

(8) As outlined in the Defence White Paper 2009 and the public Defence Capability Plan (DCP), it is the Government's intention to replace the ANZAC Class frigates with a new generation of naval surface combatants under SEA 5000. It is expected that Defence will commence work on developing this project for Government consideration beyond 2019. While the indicative initial operational capability for this project is financial year 2027-28 to financial year 2029-30 (as per the public DCP), final dates will be determined later in the project development process.

(9) The industry capacity necessary to support the capabilities/equipment that will be acquired through LAND 121 Ph 3 is not a Priority Industry Capability. The revised tender for the project included a criteria that addressed Australian industry participation in the project. It was not prioritised as all evaluation criteria are considered as part of selecting the final preferred tender. The revised tender identified industry requirements for manufacture of modules and through-life support in Australia.

(10) As announced by the Government on 12 December 2011, Rheinmetall MAN Military Vehicles Australia has been selected as the preferred supplier tenderer and will now enter into detailed negotiations to provide up to 2,700 protected and unprotected medium and heavy vehicles under LAND 121 Phase 3B.