Australia’s decision to acquire a fleet of nuclear-powered submarines will add to the budget pressures.

Australia’s decision to acquire a fleet of nuclear-powered submarines will add to the budget pressures.

The governmentreleased an analysis showing the Australian Defence Force has 28 major projects running behind schedule,with cumulative delays of 97 years and a total cost blowout of $6.5 billion.

Defence spending is set to hit $80 billion a year by the end of the decade,up from $49 billion currently. Crucially,that figure does not include the cost of nuclear submarines or an expansion in Australian Defence Force personnel.

Marcus Hellyer,a former senior public servant in the Department of Defence,said there were many uncertainties involved,but he expects the cost of the nuclear-powered submarines to reach at least $100 billion in inflation-adjusted figures.

Loading

“There is a lot of pressure on the defence budget,” said Hellyer,now an analyst at the Australian Strategic Policy Institute.

The final figure will depend on factors such as which submarine model the government selects and how much of the construction process takes place in Australia,he said.

Defence Minister Richard Marles has said the model will be announced by March next year.

Advertisement

Defence spending is already expected to hit 2.2 per cent of gross domestic product by the end of the decade,up from 2 per cent currently and its highest level since the early 1990s.

Marles said problems with major projects were “not the fault of the Department of Defence”,an argument countered by the Coalition.

Defence Minister Richard Marles and Defence Industry Minister Patrick Conroy are promising more scrutiny for troubled defence projects.

Defence Minister Richard Marles and Defence Industry Minister Patrick Conroy are promising more scrutiny for troubled defence projects.Credit:Alex Ellinghausen

Opposition defence spokesman Andrew Hastie said that “departmental secretaries and departments have responsibility as well” as politicians when key projects go awry.

“Their task is to operationalise the projects that we select,” he said.

Hastie said the opposition was “not interested in history wars,we’re interested in preparing for wars of the future”.

New figures release by the government show the biggest contributor to the $6.5 billion cost blowout is the F-35A joint strike fighter program,which is expected to cost $2.4 billion more than the $16 billion originally estimated.

The F-35A fleet is the biggest contributor to the defence cost blow out.

The F-35A fleet is the biggest contributor to the defence cost blow out.

The acquisition of a fleet of Boeing P-8A Poseidon maritime patrol and reconnaissance aircraft was the second-biggest factor,coming in at $1.8 billion over the original estimate.

The purchase of a fleet of helicopters has had the biggest blowout in terms of time,running over a decade behind schedule.

Speaking to reporters in Canberra,Marles said the government would pursue “an activist management of defence procurement going forward”.

Loading

“Defence needs to justify every dollar it spends,” he said,vowing to take the blame for problems with future projects.

“We accept the responsibility of government,and we do so going forward,” he said.

“It’s not ultimately for departments to stand here and accept responsibility for government performance. It is ministers. And we understand that’s what it is to be a minister.”

The government will also have to find money to pay for a promised 18,500 additional personnel for the Australian Defence Force and Defence civilian workforce in the years to 2040.

Cut through the noise of federal politics with news,views and expert analysis from Jacqueline Maley.Subscribers can sign up to our weekly Inside Politics newsletter here.

Most Viewed in Politics

Loading