Senate debates

Thursday, 10 May 2018


Defence Procurement; Order for the Production of Documents

3:08 pm

Photo of Marise PayneMarise Payne (NSW, Liberal Party, Minister for Defence) Share this | | Hansard source

I rise to make a statement to the Senate in relation to an order for production of documents. It frankly remains a mystery to all Australians who are interested in ensuring that Australia has a continuous naval shipbuilding program and the industry to support that why alone amongst the vast majority of Australians Senator Patrick seems unable to support that himself. It's a mystery to me and it's a mystery to his South Australian constituents. Nevertheless, we will provide some response this afternoon to his most recent motions.

It is typical histrionics from Senator Patrick to claim that the government has shown a profound lack of respect in its response to the Senate, to the President, by the letter of Minister Cormann of 12 February. In fact, if you know anything about tendering, if you know anything about significant contracts and if you know anything about national security then you would be of the view that it is perfectly reasonable, it is appropriate and it is proper that the government properly consider the circumstances under which information is publicly released where the release may have an impact on international relations and where it may unfairly prejudice the commercial interests of an entity or, indeed, of the Commonwealth. This government, perhaps unlike Senator Patrick, takes those responsibilities seriously. Further, unlike Senator Patrick's approach, this government will always act responsibly on such matters, especially when it relates to a program of such importance to our national security and to international relations.

In accordance with Senator Cormann's letter to the President when he was representing me in this place on 12 February, I will be writing to the President further on this matter.

3:10 pm

Photo of Rex PatrickRex Patrick (SA, Centre Alliance) Share this | | Hansard source

by leave—I move:

That the Senate take note of the statement.

At the outset I want to recap the sequence of events that managed to get us to this point. A year ago almost to the day, on 9 May 2017, then Senator Xenophon made an FOI application to the Department of Defence relating to Australian industry involvement in the $50 billion Future Submarine program, a nationally significant, highly important program. Senator Xenophon noted that an ANAO report into the Future Submarine CEP process had stated:

As part of its response to the competitive evaluation, the participants were required to provide an Australian Industry Plan identifying opportunities for Australian industry, and how Australian industry involvement could be maximised during the lifecycle of the program.

Senator Xenophon was interested in just what Australian industry involvement would be in this tremendously important national project and accordingly made an FOI application to the defence department for the final submarine Australian industry plan submitted to Defence by the submarine builder DCNS, now Naval Group. He simply wanted to know what they had promised to do in respect of Australian industry.

Defence was really quick to respond. Just two weeks later on 23 May 2017, a decision was made denying access to the document because, the department said, it did not exist. At that time I was an adviser to Senator Xenophon and on his behalf sought an internal review of that decision. After all, the Auditor-General had referenced it, so I was pretty sure that it did exist. On 26 June, a senior officer in the defence department made an internal review decision. Having found the document did actually exist, the department refused access to it in its entirety, claiming the documents to be exempt under sections 47C and 47G of the FOI Act. They claimed that the document contained information that was deliberative in nature and also contained confidential business information and commercial or financial information that, had it been released, would have disadvantaged or prejudiced business operation and may even have caused Defence difficulty in seeking such information in the future.

At the time, Defence made no claim—no claim at all—under section 33 of the FOI Act that the document was exempt from disclosure because it contained information that, if released, would damage the defence security or international relationships with the Commonwealth. No such claim was made. Former Senator Xenophon referred Defence's internal review decision to the Information Commissioner for independent review. That review is ongoing and is now being handled by me and my office on behalf of Mr Xenophon.

To move to this year: in the Senate on 12 February, I moved a motion for an order for the production of documents—specifically for the Minister representing the Minister for Defence Industry to present to the Senate the Australian industry capability plan submitted by DCNS to the defence department in its response to the Future Submarine competitive evaluation process. You might recall that at that time the defence industry minister had gone from 90 per cent to 60 per cent Australian industry content, and now we have just received a Future Frigate document that went to 50 per cent Australian industry content. In speaking to that motion, I made the following comments, which are worth repeating today:

This document is an important document which outlines the promise of DCNS, now Naval Group, to Australian industry as to what involvement it will have in the Future Submarine project. It is an important document that former Senator Xenophon requested under FOI in April 2017. What this means is that the Information Commissioner is about to make a decision about it. So I respectfully suggest to the minister that she needs to respond to the OPD in a very considered manner. I don't want to see the minister ordered to make another explanation as to why she got her OPD response wrong, because I can assure you I will not hesitate to protect the integrity of the Senate oversight processes in circumstances where the minister makes another bogus claim.

Senators will recall the Minister for Defence had previously claimed documents relating to the Future Frigate Program could not be released to the Senate, not only on grounds of national security and defence but also for international relations reasons, only to have those documents released through an FOI review undertaken by the Information Commissioner. So we can't have them, but Mr Xenophon, in those circumstances, could.

On 12 February, Senator McGrath affirmed to the Senate that the government would not release the DCNS Australian industry capability plan; indeed, it would continue to withhold the document in its entirety. Senator McGrath claimed the entire document contained intellectual property regarding the design and build of submarines and the methods for technology transfer. The subject matter of the document itself—Australian industry participation—made Senator McGrath's claims about intellectual property and technology transfer as the basis for withholding the entire document rather implausible. Most significantly, Senator McGrath added—almost as an afterthought but clearly as a justification for a complete refusal to disclose—that 'disclosure could be expected to damage Australia's international relations with France.'

This was the first time, on 12 February this year, that the government claimed that the release of the document would damage Australia's international relations. That claim had not been made by Defence in Defence's original internal review decision seven months earlier. It's not been made by Defence in the review process taking place with the Information Commissioner. One might have reasonably thought that, if the claim had merit, Defence would have already argued it, but they'd not raised it at all.

On 12 February 2018, the Senate agreed to the OPD motion. On 15 February this year, the duty minister tabled in the Senate a letter claiming public interest immunity and stating that the release of the documents would affect the commercial interests of Naval Group and adversely affect Australia's international relations. That letter further advised the Senate that the government was awaiting the outcome of the Information Commissioner's review into FOI exemption claimed over the documents. On 27 March this year, I moved a further motion that noted a previous Senate resolution and declared:

… declining to provide documents or answer questions on the basis that an FOI request has been made for the same information is an unacceptable response, is not supported by the FOI Act and shows a profound lack of respect for the Senate and its committees.

They're not my words; they come from Odgers.

The motion further observed:

(f) … claim of commercial confidentiality must be carefully advanced and claimed narrowly so as to recognise the public interest that lies in openness and transparency on this very important project.

The motion further made the point:

(g) the claim that the release of the documents will affect international relations is not properly made out and is flawed (and has not even been advanced by the Department of Defence as a concern in the Information Commissioner Review) because the document which is the subject of the order is a document of a French-law Public Limited Company, not a document of the French state;

The motion further called on the Minister for Defence to make a statement to the Senate—which she's done today—addressing why she:

(a) has advanced a claim showing a profound lack of respect for the Senate;

(b) offered a broad confidentiality claim that does not correctly balance the public interest in knowing what DCNS promised, in respect of Australian industry involvement in our largest ever Defence project; and

(c) has advanced a claim that releasing the document to the Senate would affect Australia's international relations knowing that this claim is inconsistent with the position of her own Department.

The motion was agreed to on 27 March.

Eight days after that motion there was a further interesting development in this story. On 4 April 2018, Defence made a new submission to the Information Commissioner's review and belatedly introduced a claim for the documents to be wholly exempt under section 33 of the FOI Act—namely, that the release of the documents would damage Australia's international relations. As I've said, in the course of nearly a year, Defence had not previously made that claim. That fact begs the question as to what, if anything, has happened to change the department's position.

Defence now claims that the release of the documents could reasonably be expected to cause damage to Australia's relationship with foreign governments; that it would damage international confidence in Australia and Australia's relationship with other countries; that it would adversely affect the ability of the Australian government to maintain good working relationships with other governments and international organisations; that it would cause a loss of trust and confidence in the Australian government; and that foreign officials may be less willing to engage with Australian businesses in future. None of those claims had been made previously; they were all freshly minted. Yet the department failed to detail any evidence to support its claim in relation to the release of the documents, which is, it should be recalled, information provided to the Commonwealth by a commercial entity engaged in a commercial tender process.

Defence's section 33 claim had been made late in the day. It is heavy on assertion and very light on evidence or argument. It looks much like something that's been cobbled together to bring the department's position in line with the assertion made by the minister in this place. Given the context of deliberations in the Senate on this matter since 12 February, it's not unreasonable to conclude that Defence's claim of a section 33 exemption may not be based on a careful evaluation of the relevant facts; rather, it may well be made in response to a direction or other interference from a minister's office or else was made by the department simply in order to bring the department's position in line with the claim made by the government in the Senate.

However, efforts to avoid political embarrassment for ministers are not appropriate drivers for departmental FOI decision-making. Defence's decision-making in this matter may well have been politically compromised. Accordingly, I have made a formal complaint to the Information Commissioner under section 70 of the FOI Act in relation to the defence department's decision-making in this matter. I have specifically requested the Information Commissioner to make inquiries and investigate Defence's decision-making in respect of its new section 33 exemption claim. It would be appropriate—indeed, I believe it is essential—for the information in pursuing such an inquiry to require under section 79 of the FOI Act the production of relevant documents and records, including communications between the department and ministers' offices and between the ministers' offices themselves in order to determine when, how and on what basis the purported new international relations exemption claims were made. Such an inquiry is essential to determine whether the integrity of Defence's decision-making has been compromised and whether Defence's claims are based on careful and objective reasoning and not on the desire to accommodate the political interests of the minister.

But that's not the end of the story. Curiously, on 30 April, I was advised by the Office of the Australian Information Commissioner that Defence had advised that 'they intend to release at least part of the document and will do so tomorrow'—11 May. So perhaps some of those claims of exemption were not very robust at all and could not have been applied to the document in its entirety. But how convenient the timing is! Defence is waiting until tomorrow, after the Senate has risen this week, before it provides me with the new documents.

This is not the first occasion that the defence minister has, on dubious grounds, invoked 'damage to national security or international relations' to justify withholding information from the Senate. However, national security is not a political light bulb that can be switched on and off at the whim of ministers to resist releasing what they may consider to be embarrassing information.

Today the minister stated that there were very serious reasons for not providing this information to the Senate. Yet I have a document from the Information Commissioner today saying that Defence is quite prepared to release some of that information to Mr Xenophon. They won't release it to the Senate—the Senate won't get anything, it appears—but Mr Xenophon can get his information. In response, I can only return to the remarks I made on 12 February, when I respectfully suggested the minister needed to respond to the OPD in a very considered manner and that it would be regrettable if the minister had to make another explanation as to why she got her OPD response wrong. Regrettably, she did not do so. Instead the government have adopted an obstructive and negative approach to the release of information. They have done so in complete disregard of public interest.

The extent of Australian industry participation in the new submarine project, a project of tremendous national security and economic importance, is clearly something that should be subject to well-informed debate not only in the Senate but also in the public domain more broadly. A year has passed since former Senator Xenophon made his original application. Yet here we are today, with the government still fighting tooth and nail to keep these things locked away. They must do better than this, and the Senate must hold them to account.

3:25 pm

Photo of Kim CarrKim Carr (Victoria, Australian Labor Party, Shadow Minister for Innovation, Industry, Science and Research) Share this | | Hansard source

The information that is being sought through this return to order unfortunately follows a record of deception and dissimilation, which Senator Patrick has outlined this afternoon, as a result of this government seeking to withhold legitimate information from the Senate. I have participated in the various committees of the Senate for quite some time. I have participated in the Senate inquiry into naval shipbuilding in this parliament, and I have seen the wide and reckless claims that the government have made in regard to executive privilege, the future frigate programs and the submarine programs. The claims they have made in regard to the withholding of information based on spurious protections of international relations or national security are confounded by the fact that these documents have so often been released subsequently. This is the really serious flaw in the government's argument. If the Information Commissioner is able to release the documents having had ministers of this government stand in this chamber and deny the legitimacy of the requests that are being made by senators in this chamber, it strikes me that it really does highlight the level of deception that this government has engaged in.

In my opinion, these are not questions that go to national security. As the alternative government, it is not the opposition's view that we would be engaged in questions that would fundamentally challenge the national security of the Commonwealth of Australia. As the alternative government, we have a responsibility to ensure that we don't use the powers of the Senate in a reckless manner. What we do have, though, is the responsibility to hold the government to account and to ensure that the actions of the government are scrutinised properly.

The fundamental premise on which the government's actions have been based has not been matters of national security but matters that go to the political interests of the government. The record of the government's Naval Shipbuilding Plan is much touted: a $90 billion investment and the development of a sovereign capability in our country, particularly the $50 billion Future Frigate Program, is essentially about a fundamental issue of the future direction of this country. It is only appropriate that we as senators take this matter at the most serious level. If we ignore the rhetoric and focus on what the government actually does in regards to the shipbuilding plan, I think we're entitled to go to the heart of what this issue really does come down to.

What has concerned me and my examination of these issues over the life of this government is that the Naval Shipbuilding Plan is increasingly resembling not a national industry plan for the development of a national capability in shipbuilding but a national marginal seats plan for this government. This is a government that makes assurances about shipbuilding jobs, for instance, which are simply not being fulfilled. Recently we have had the situation with Osborne, a shipyard in South Australia, where the ASC is still shedding jobs. Just last month, it announced 223 jobs would go. This is despite the fact that last December, last November—on numerous occasions in that period—and last October as well, the Minister for Defence Industry told the media:

The valley of death is over and we are now seeing a upturn of employment in naval shipbuilding in our state that will only continue to increase as these new projects gain momentum.

Yet he had previously told representatives of the metalworkers union and the Secretary of the ACTU that the ASC was transitioning and that he was doing all that was necessary to ensure that that was coming about. On 6 December Mr Glenn Thompson, the National Assistant Secretary of the AMWU, saw Mr Pyne in his office and was told that there would be no further job losses at the ASC.

On 11 December, Mr Pyne issued a media release where he said:

We are stabilising the shipbuilding workforce … things are truly on the up at Osborne.

However, on 22 April this year, the shipbuilding workers at Osborne found out what 'stabilising' actually meant under this government. It meant a further 223 of them were to go. We've got a long litany of broken promises. The minister's evasions and deceptions on this issue, I think, are totally without peer when it comes to what is a pretty sorry record of naval procurement.

The minister, in April 2016, announced that the company known as Naval Group was selected to design the Future Submarines. The Prime Minister talked to journalists at that time, with regard to the issue of sustainment of the submarines. This is the point of the documents that Senator Patrick has been able to secure through this process of discovery. The Prime Minister has been quoted many times in the media now about the delivery of the work. He said:

It will be shared between the two but the heavier work, if you like, was obviously always going to be done here at Osborne, as it is now.

Of course, what the Prime Minister was doing on that occasion was playing to a South Australian audience. What we know from the documents that Senator Patrick has brought before us is that a very different message was being given to the Department of Defence. Less than two months after that statement by the Prime Minister, on 3 June, the department asked the ASC, which carried out the work on the Collins class submarine at Osborne, to estimate the cost and time required to consolidate all the shipbuilding work in Western Australia—that was to actually shift the sustainment work to Western Australia. So the Prime Minister is telling the people of South Australia the work will be done in South Australia, while the department's asking the ASC what it costs and what it involves to move the work to Western Australia. Of course, that's being done in secret. The statement from the department issued to the ASC notes that the Collins class boats would still be in service at a time when the substantial construction work on the submarines and surface ships was underway at Osborne. He said:

This combination of activities may exceed the available industry capacity in SA, which may motivate consideration of a consolidation of Collins maintenance activities in WA, in order that SA industry might concentrate on ship and submarine construction.

Advice regarding scope, cost, schedule and risk of consolidating submarine maintenance in WA will help inform future considerations—

of the project. And the ASC, of course, was given until February 2017 to come up with an answer. The level of sheer dishonesty that's been perpetrated in this matter is clear for all to see.

What we know now, of course, is that there was something very pressing in the Prime Minister's mind when these matters were being developed. In the last week of May 2016 he announced that a federal election would be held on 2 July. That was an election in which the government was very worried about the job losses in South Australia. That was an election in which the government was very anxious about the consequences of its decision to destroy the motor vehicle manufacturing industry in this country. It wouldn't have been a good time to admit the truth about the government's intention to undermine the ASC and switch the sustainment work out of Adelaide and send it across to Western Australia. It wouldn't have been a good time to be honest with the workers at the ASC, who were employed in the sustainment of the Collins class boats, including the full-cycle docking at Osborne. So the Prime Minister used evasive words. He talked about sharing of the work between Osborne and Henderson. He said:

… the heavier work … was… always going to be done … at Osborne …

We now know that the government was acting in a thoroughly dishonest and deceptive manner. If the government were serious about investing in the industry, if it were serious about developing the national capabilities in terms of naval shipbuilding, if it were serious about these questions of national interest, it would have actually argued its case publicly. It certainly wouldn't have engaged in this rhetorical sleight of hand. If it believed that it was actually in the national interest to develop the capacity at Henderson, you would have thought it would have said so. If it were serious about arguing the case for a long-term strategic industry, you would have thought it would have said so as well, rather than taking the slippery, evasive approach which has been highlighted throughout this whole process and which these documents reveal time and time again. What does the government do? It wraps itself in the flag and tries to pretend that it is engaged in something other than sheer political hypocrisy, when it is developing a national capacity to defend its own marginal seats rather than defend the national interests of this country.

The government talks a lot about short-term thinking. Well, it is a past master of short-term thinking—thinking about the next election, desperately trying to maintain its political survival. When you put on top of that a South Australian election, which is what we have had, and a minister in South Australia who really shouldn't be known as the Minister for Defence Industry but should be known as the Minister for Marginal Seats, we've got a situation where this government simply can't help itself. It just cannot help itself. A government that was directly responsible for the destruction of the automotive manufacturing industry in South Australia then had to turn around and try to dress that up by some arrangements with regard to naval shipbuilding, but it couldn't then quite work out how to balance out the interests in South Australia against its marginal seats interests in Perth.

What we've got is a government that tries to hide its political intentions, and these documents reveal the inner secrets of what's actually been going on inside the government. We now know that the government has made no attempt to explain how it will reconcile its conduct of the business between the department and the ASC with regard to submarine sustainment. Now, of course, we are past the 2016 election, past the South Australian election, and we discover in these documents that the department is then instructed to go ahead with the project, having had to suspend it when it gets caught out.

We now know that the Department of Defence is instructed in such a way as to suggest that it is entirely responsive to the political demands of the ministry, not the national interests of the country. That's why I'm so concerned about the process by which we are going through these discussions at the moment. If the government wants to claim national interest immunity in terms of the provision of documents, it's got to be consistent in its approach. It simply can't rely on these weasel words, suggesting it can't provide information on the basis of a range of priorities or suggesting it is commercial-in-confidence or involves national security, when the real issue here is nothing more than the political priorities of the government, as dictated by the electoral cycle.

The evasiveness about the dates on which the government operated has now been exposed. The release of the documents has shown clearly the events that have unfolded with regard to the department's request for the ASC on the consolidation of the submarine sustainment program. The department's Capability and Acquisition Sustainment Group emailed the ASC and made very clear the way in which it was to operate. The consequences of this in terms of the precedent that's been set for the Future Frigate Program are deeply disturbing, particularly when that decision is due within a month. If this is the way we are to conduct the procurement for $50 billion, one has to question what the approach will be for the frigates program. What I'd like to know is whether or not this is going to in fact be the practice. That's why the shipbuilding inquiry, which will be examining this issue and will have a future hearing within another month, will have an opportunity to examine these questions.

The approach that's been taken with regard to some of our major contractors—the very partisan approach that's been taken in regard to the tendering arrangements—should be subject to very close examination. The approach that's been taken by Austal in Western Australia suggests to me that a distinct bias has been taken against Australian shipbuilding. I trust that my suspicions are incorrect. But the operations of the Offshore Patrol Vessel contract and the manner in which the discussions have taken place with the preferred tenderer from Germany—and at this point, as I understand it, the ASC has actually been obliged to go to Germany to discuss those tendering arrangements; they're in Germany right now—demonstrates just how, in the government's mind, it should operate. If the frigates contract is to be treated in the same way, then I suggest that we have a serious problem.

A genuine national industry plan should be concentrating on the capacity of this country to build its capabilities from the basis of a design through to building and to maintenance. We're not seeing that. We're not seeing a genuine plan B developed to marshal and harmonise all our nation's resources, and we're not seeing that in so many areas of government policy. Just recently in the budget a similar pattern was announced with regard to the space industry, for instance. I can say this in so many areas of science, where the government is simply aiming at wining short-term political advantage rather than thinking about the long-term interests of the country.

The shipyard workers at Osborne and at Henderson are entitled to be treated so much better than they are being treated, and they deserve to be treated better. They're entitled not to be treated as pawns in a rather tawdry political game. I think that the people of this country, who are paying the bills for this procurement, are entitled to be taken into the government's confidence about the way these plans have been developed. That would require a change in direction—a fundamental change in attitude by a government who would actually be committed to developing a genuinely long-term, strategic shipbuilding plan. It would require an entirely different course. From what I've seen from these documents and from questioning so many of the witnesses through the various committee processes of this Senate, this is a government that's failed those tests—and, frankly, it's failed the people of this country: $90 billion is a lot of money in anyone's language, and if we are to truly develop a national shipbuilding capacity in this country we really do have to work a lot harder at this than we have through this experience.

For the minister to come in here and say, 'Look, I'm not going to talk to you about this, because it's a matter of national security,' is simply not going to cut it. Senator Patrick, I think securing these documents has done a real service to this parliament and to this country. We have supported the securing of these documents because it's the proper role of the Senate in its scrutiny of government programs. We won't act recklessly and we won't be in the business of undermining the capability of this country to procure these vessels properly, but we will be in the business of proper public accountability.

3:44 pm

Photo of Ian MacdonaldIan Macdonald (Queensland, Liberal Party) Share this | | Hansard source

I thank Senator Payne for her statement today and for the documents she may have tabled. The nation is particularly fortunate to have a Minister for Defence with the style, capability and energy of Senator Payne. We are doubly fortunate in that we have Mr Pyne as Minister for Defence Industry. I can understand the concern of the Labor Party in nit-picking any little hole all the way, because during the six-year term of the Labor government they did absolutely nothing with defence procurement. There wasn't a ship build in sight under Labor. I can understand why Senator Carr wants to divert attention away from this government's great success in building, designing and launching military hardware within our country.

Senator Patrick indicates that he was an adviser to Senator Xenophon. He was also an adviser to a Liberal minister for defence, and I sometimes wonder about the source of some of Senator Patrick's knowledge. Senator Patrick made a long speech full of accusations and assumptions, not of fact. There was not one fact in them, just accusations and assumptions, mainly against public servants who aren't here and aren't capable of answering for themselves. It's typical that, when these facts are pointed out, both Senator Patrick and Senator Carr, who each had 20 minutes of accusations and assumptions—no facts—about a government that does something in the military construction area, they walk out of the debate.

Those who might be listening to this on radio should understand that what you've just heard in the last 40 minutes from Senator Patrick and Senator Carr is purely crass politics and has nothing to do with integrity or our military support. I won't go into the actual details; I hope and think that my colleague, Senator Fawcett, who is an expert in this area and a South Australian, will deal with some of the fallacies he may have heard in the previous two speeches. I just want to say how very fortunate Australia is to have defence ministers—two of them—and a government prepared to do something about construction of defence hardware. Labor continues to argue about and criticise the construction of ships. I again mention that Labor, in the six years it was in power in this country, did absolutely nothing about getting some ships built in Australia.

Ninety billion dollars has been allocated by this government for military hardware, most of which will be constructed within Australia. It will be done principally for our defence forces to ensure we can properly defend Australia, but it's important that most of that work will be done within Australia by Australian workers. You know where Senator Carr is coming from when, shortly into his speech, he starts telling you what the unions had told him to say about this. It's the old Labor approach, because they are entirely controlled by the union movement. When the unions ask Senator Carr to jump, he always says, 'How high?' He wasn't speaking in the interests of Australia or the integrity of the Senate, as he pretended he was; he was talking about the interests of the union movement in Australia, to which Senator Carr and most of his colleagues over there are entirely beholden.

I again thank Senator Payne and Mr Pyne for what they have done. I cannot understand why people like Senator Carr and Senator Patrick spend all of their time here criticising work that every other Australian says is just wonderful. We have this work in Australia. It's the first time for a long time. More than that—digressing slightly from shipbuilding—I'm from Queensland, and Senator Payne, in answering a question in the Senate yesterday, pointed out that 80 per cent of the work being done in the Central Queensland area, at Shoalwater Bay, for Australia's military training field is being done by local Central Queensland contractors.

That has been the whole direction of this government. Yes, we need these things done for the defence of our country and to make sure our military is properly equipped but, at the same time, we are doing it in a way that creates wealth and jobs for Australians. I can only congratulate the government, and I simply cannot understand the Senator Patricks and the Senator Carrs of this world who continually try to take down the wonderful work that is being done by this government—work which the Labor Party was never prepared to do.

3:50 pm

Photo of Peter Whish-WilsonPeter Whish-Wilson (Tasmania, Australian Greens) Share this | | Hansard source

I would like to rise on behalf of the Greens to also comment on this debate today and I'd also like to recognise, Senator Patrick, the importance of getting scrutiny. We just heard from Senator Macdonald about a $90 billion outlay on defence hardware. That is an incredible amount of money—$90 billion. Two years ago in budget week we heard that this government was ramping up defence spending to two per cent of GDP—the biggest increase since the Second World War—on the back of a white paper that said that there were no evident threats in our region. We've also heard in the last 12 months that this government is embarking on an arms export plan to put Australia in the top 10 exporters of defence military hardware in the world, including selling weapons to countries like Saudi Arabia.

Why is this occurring? I have my own theory. In fact, what I was going to say to Senator Patrick a little bit earlier was that I was in the same situation that he was in today—twice—three to four years ago, when the government refused, when ordered by the Senate under an order for the production of documents, to release information on the negotiations on the Trans-Pacific Partnership agreement. Twice the Senate voted for the government to release those documents and twice the minister came in here and refused to release information. I sat down and I chatted with the Clerk of the Senate at the time, Rosemary Laing, and I said, 'What do you do?' She took out Odgersand she showed me. Hopefully I'm not oversimplifying it, but she basically said: 'The Senate needs to vote against all legislation in this area. You need to put up a fight. That's the only thing you can do. You can't demand a government release these documents, but the Senate, as a body, can continually make their life difficult until they come and play ball.' That's what I chose to do over the next four years over free trade deals that were done behind closed doors and taken outside of the scope of parliament.

The reason I raise these free trade deals is not just around the order for the production of documents; my theory is that the reason that we have this $90 billion industry policy—and that's just the start of it; our estimate is that this is going to be hundreds of billions of dollars—is largely to do with all these free trade deals we've signed in the last five or six years, which preclude us and governments directly subsidising industries like the car industry, which was ultimately killed by free trade deals, or other industries, because it is not allowed under state-to-state or investor state in all these deals we have been signing. The only thing that is excluded and carved out, funnily enough, is defence and national security industries. That's why this government, in the last four years, has gone down the road of making this an industry policy, not just a defence policy. I have no doubt about that.

I had a discussion with Senator Payne at last estimates about the jobs that the new arms export industry plan was going to create, because the Liberal Party said in its media release that this was a 'jobs plan'. They were their own words. I asked: 'How many jobs is this plan going to create?' And they couldn't name a single bit of work that had been done to try to forecast that or estimate that. Do you know what Senator Payne did?

Senator Payne came very close to doing this to Senator Patrick today, but she fell short. She played the patriot card—How dare you ask questions! Aren't you patriotic? Don't you support our armed forces? Don't you support our Defence personnel?—because I dared scrutinise a plan with $3.8 billion being given to companies to create weapons to sell overseas.

What we're seeing here today is on an even bigger and more disturbing scale, and I think it's just the beginning of it. So transparency is absolutely critical. It is the job of the Senate. The reason we're here is to scrutinise. If the government come in here with the attitude that Senator Payne shows—that somehow this is below contempt for them—then this is going to continue. I'm actually glad that it's taken something like this for this chamber to scrutinise an aspect of defence spending.

I will say, just to finish, that it's good to see scrutiny on how much content is going to be Australian made. That's a very noble and important cause and something the Greens no doubt will support. But I'd also like to see a lot more scrutiny on the decisions about whether we even need this kind of hardware in the first place—for example, 12 submarines or Joint Strike Fighters. I'd like to see a lot more scrutiny in this place around the actual decisions that lead to the procurement of these kinds of hardware programs.

3:56 pm

Photo of Alex GallacherAlex Gallacher (SA, Australian Labor Party) Share this | | Hansard source

I rise to make a contribution on this matter. It's always a pleasure to follow Senator Macdonald. It usually means that you don't need any speaking notes because he raises so many points that are so easy to rebut. I'm sure the Hon. Marise Payne is basking in the warm glow of his adulation and appreciation. I am absolutely certain of that. But, just to take one point of issue, we are this day going to table in this parliament a report on the economic effect that defence training exercises have around the country. The fact that Shoalwater Bay is now able to demonstrate 80 per cent local content is a really good thing, but at the start of that inquiry—and we produced four interim reports—Defence wasn't able to demonstrate that. Trust me: you can see that from the evidence. Victory always has 1,000 fathers, and no doubt Senator Macdonald is claiming that as a victory for himself personally and the minister.

I accept the minister has moved very quickly in that area to put in place around those exercises really good practice that is beneficial to regional economies. But Senator Macdonald's statements alleging that Senator Carr is simply jumping at the request of unions could not be further from the truth. I don't really get where he's coming from. If representing the best interests of skilled, hardworking, willing workers in an immensely important Defence sector is a sin then I'm sure everybody on this side of the chamber, and probably a few on the other side of the chamber, are going to plead guilty—but it's not a sin. When I go to Senate estimates and carry out my duty, which is to go to the Finance and Public Administration Legislation Committee hearing, look at the Hon. Mathias Cormann and read a script which says, 'We have so many people employed, so many apprentices employed and so many contractors employed; can you please update the register?' he immediately says: 'It is all your fault. When you were in government, you did nothing.' I have to remind the other side that that's two parliaments ago. A couple of parliaments have been created since that day. Blaming it all on the Labor Party five or six years later really doesn't cut it.

We have the Hon. Christopher Pyne declaring that the 'valley of death' is over and that the decision that he has made will avert people being turned off through lack of work and having to seek employment in other states or overseas. We know through the estimates process and the briefings we get that these workers are immensely valuable and skilful and they probably won't have a great deal of difficulty translating those skills into other sectors—but at what cost to this project? What is the cost to this project if that workforce—currently 223 jobs—is being shed, despite the protestations that the valley of death has been averted? That claim, extraordinarily enough, came during the preamble to the South Australian election: 'The valley of death is over. We've fixed it all. It's all good. We're getting on with the job.' Shortly thereafter, ASC announced it had to shed 223 jobs.

We know that the Minister for Finance is a shareholder of ASC, and we know that the Minister for Finance is very keen to sheet all the blame home to other people and to governments twice removed. But really the responsibility does go to this government, to these ministers, to properly and appropriately plan the spend of $87 billion and to properly and prudently put in place the right parameters, the right disclosure and the right decisions for the country. And it shouldn't be based on a marginal seat campaign. The South Australian redistribution is over, and plenty of people in South Australia recommended that the Honourable Christopher Pyne's seat of Sturt be abolished. But the Electoral Commission didn't take that advice. They abolished the seat of Port Adelaide, much to the amusement of some. So the member for Sturt's seat is now safe. The seat of Sturt is safe, but it should never have been in the consideration.

It's very shallow of Senator Macdonald to cast aspersions that representing working class skilled South Australians and others in this sector is a bad thing to do. What is shallow and what is not worthy of proper ministerial diligence is making decisions designed to protect someone's seat—federal, state or other. Defence and Defence's capability is too important to be put at risk for those shallow political considerations. So, Senator Macdonald, you're completely wrong. But we'll willingly wear the tag every day, forever, of standing up for hardworking skilled workers in whatever sector. If this is a stop-gap, or a sop to skilled workers in South Australia for the damage caused by the closing of the automotive industry, then get on with it. Let's program it properly. Let's avoid the loss of jobs. These workers will probably get jobs elsewhere because they're skilled and hardworking. If we can avoid the loss of skills to the sector, that's a direct benefit to defence capability, a direct benefit to the nation and a prudent and efficient way of doing business. In my view, that is where we should be going.

Question agreed to.