Wednesday, 10 October 2012
Questions on Notice
Defence (Question No. 2083)
asked the Minister representing the Minister for Defence, upon notice, on 20 August 2012:
As at 30 June 2012:
(a) what specific productivity improvement savings have been made in Smart Sustainment reform; and
(b) what one-off savings been made?
The Minister for Defence has provided the following answer to the honourable senator's question:
(a) The Smart Sustainment Reform Stream of the Defence Strategic Reform Program does not account for specific savings against implementation areas of smart maintenance techniques, optimising inventory holdings and specific productivity improvements. The Stream is managed as a package of some 800 initiatives assigned to capability managers and system program office directors. There are three main categories of initiatives: Demand Management; Supply Management; and Process Improvement. Examples of initiatives within each of these categories are: the disposal of fleets that are no longer cost effective; competing support arrangements and improved availability; and the application of reliability, availability and maintainability analysis. In addition, these are complemented by improved decision making for the purchase of inventory through the use of advanced decision support systems.
(b) The Stream has achieved all the target cost savings in the 2019/10 and 2010/11 financial years of $551 million. The outcomes for 2011/12 are currently being validated but are expected to achieve the target of $370 million. Defence will publish the stream cost reductions achieved for the full financial year in the Defence Annual Report 2011-12 which will be released in late 2012.