Antinuclear

Business as usual: Labor stalls on Defence reform as AUKUS woes grow

Defence spending is lagging, AUKUS is stalling, and systemic mismanagement persists as Labor avoids hard structural reform.

Bernard Keane, May 11, 2025, https://www.themandarin.com.au/291901-business-as-usual-labor-stalls-on-defence-reform-as-aukus-woes-grow/

Having managed to get through an election campaign barely mentioning defence — despite the opposition trying to make it a late-stage vote winner — the newly expanded Labor government still faces a number of big challenges in the defence portfolio, and no easy answers.

The two big ones are well-known: the replacement of the US security guarantee with Trumpian chaos, which means Australia will have to strengthen its defence capability so that it has to rely less on the US, and the profound problems of AUKUS.

Despite some budget sleight of hand purporting to show an acceleration in defence spending, the government remains committed to increasing defence spending to just 2.33% of GDP — not merely well below the Trump administration’s demand for 3%, but below the Coalition’s planned increase to 2.5% and the calls from defence and security experts, as well as Labor luminaries like Kim Beazley, for a significant increase.

But the ability of the Department of Defence to handle any increase in spending — or even competently spend what it currently receives — is openly questioned even by hawks. Average major project slippage time, already alarming when the Coalition was last in power, noticeably deteriorated in Labor’s first term. The response of Defence appeared to try to hide embarrassing data from the Auditor-General under the pretence of national security.

Also characterising Labor’s first term was the admission of failure of departmental process, to the very highest echelons of Defence, in relation to the Hunter-class frigate project and the shocking audit of Defence’s dealings with Thales on munitions manufacturing (the second part of which is yet to arrive from the auditor-general).

With both defence minister Richard Marles’ track record in Labor first term, and his general insouciance toward revelations such as the Thales debacle — which included the revelation that the department had actively misled predecessor ministers — it seems unlikely Defence will face any real pressure to improve the incompetence and, quite possibly, corruption that marks its management of major procurement processes. A defence minister like Andrew Hastie, far more credentialed in military matters than most within the department, could have driven the kind of reform that would have gotten Defence backs up, and led to copious leaking against him, but improved the reliability and integrity of the department’s procurement processes. Instead, we’ll have to hope that a Labor government with a big majority and more confidence will be more willing to take on the fundamental problems in the portfolio.

A similar business-as-usual approach will likely characterise the unfolding disaster that is AUKUS. The grim reality is that US submarine construction rates are slowing, not accelerating as they need to if the US is to provide three Virginia-class nuclear submarines to Australia from 2030. In early April, the US Navy admitted to Congress significant delays in constructing its new Columbia-class ballistic missile submarine, which shares some components with the Virginia class. While the builders of the Virginia-class boats are talking bravely of demand signals and additional investment, the build rate for the subs late last year was barely above half that required by AUKUS.

None of this, apparently, is of interest to the bureaucrats charged with overseeing AUKUS. The Mandarin applied under Freedom of Information laws to the Australian Submarine Agency to see what briefing it was providing to ministers on the problems in submarine construction in the US and the UK. No such documents, came back the answer. Blind faith that the US can double the rate of submarine construction in a couple of years is one thing, but remaining ignorant of how badly off track AUKUS is? That’s quite another.

One of the key problems of the Virginia-class boats for Australia is that they require huge crews — 135 sailors, compared to just 58 for Australia’s current submarines. That brings into focus a persistent and worsening problem — our inability to attract and retain ADF members. Last year the Navy was short around 900 people. The Army was short around 5000; only the RAAF is around its mandated strength. A change of recruitment agency for the ADF proved a disaster, with portfolio minister Matt Keogh expressing his “deep disappointment” with the provider’s “wholly deficient” performance. Critics say the problem is with the ADF itself, which is “too slow and too picky”. The government announced in mid-2024 the brilliant idea of opening up the ADF to personnel from Five Eyes. countries. Only problem is, they’re all suffering the same problems with defence recruitment. In fact, armies, navies and air forces around the world are suffering ongoing recruitment problems and have done so for years — even the People’s Liberation Army is struggling to attract Chinese youth to its ranks.

In each of these areas, clearly, business as usual won’t cut it. But that is what Defence is very good at, and its ministers are very bad at preventing. To prevent it, only structural arrangements that disrupt Defence’s normal processes will achieve results. The royal commission into ADF member and veteran suicide had the right idea — and the government rightly took its lead from the commission in its response. The commission recommended a new independent statutory body to oversee reform across the whole Defence/Veterans Affairs portfolio, not a new area of Defence. And it urged, and the government agreed, that central agencies be charged with implementing the commission’s recommendations: the result was a Prime Minister and Cabinet taskforce to start implementing reforms, with the help of external expertise.

An independent agency, and a PM&C-led implementation taskforce, was what was needed to ensure Defence didn’t simply default back to business as usual when it came to the mental health of its members and veterans. Only the oversight and interference of high-powered external bodies will compel Defence to change its culture.

And it’s the only thing that will enable the government to seriously tackle the biggest challenges in the portfolio over the coming years.

Bernard Keane

Bernard Keane is a columnist for The Mandarin. He was a Canberra press gallery correspondent covering politics, national security and economics, and a public servant and speechwriter in transport and communications. He is co-author of A Short History Of Stupid, which covers the decline of reason and issues with public debate.

May 12, 2025 - Posted by Christina Macpherson | politics