What Australia has spent so far

Five years into AUKUS, what do we have to show for it? We’ve measured progress on three key metrics

Thomas Corben and Esther Soulard, The Conversation, 15 Sept 26,

“. What Australia has spent so far.…………………………………………………………Australians are justified in wanting to know how much money their government has invested in AUKUS, and where it has gone.

When the Optimal Pathway was announced in 2023, the Albanese government costed it at 0.15% of GDP annually over the life of the program. This would amount to roughly A$268 billion to A$368 billion over three decades.

Since then, the A$368 billion figure has been widely cited by the media as the ultimate price tag.

Crucially, at the time, a third of this total – around A$122.9 billion – was set aside as contingency funding to absorb the delays and cost pressures that come with a 30-year program. In other words, it may not actually be spent.

Accurately tracking Australia’s overall spending to date is difficult. Since 2023, there has been a flurry of government statements announcing or promising funding to support various aspects of AUKUS over different time frames. These figures are scattered across portfolios, and are sometimes announced and then folded into the forward estimates of the federal budget. Some are projections, rather than down payments.

Both the Liberals and Greens have pressed the government to share updated costings for AUKUS. Budget papers do not offer an itemised account nor a consolidated overall figure for the program so far.

With no central database for AUKUS spending, we set out to build one.

We went through public announcements, portfolio budget statements, annual reports and strategy documents, and attempted to trace everything that’s been spent, announced, promised or projected.

What we’ve come up with hardly qualifies as a ledger. Still, it reveals three important things.

First, the bulk of the funding announced in Australia has gone to infrastructure, across three main sites:

A$12 billion on the Henderson Defence Precinct, a shipbuilding and submarine maintenance hub on the west coast
A$8 billion to expand HMAS Stirling so it can host US and UK submarines under SRF-West from 2027, and Australia’s own fleet of submarines from the early 2030s
A$8.5 billion to the Osborne Nuclear-Powered Submarine Construction Yard, where Australia’s nuclear submarines will be built.

Second, Canberra is investing in the UK and US submarine industrial bases to support the delivery of the Virginia-class and future AUKUS-class submarines to Australia. This reflects the additional demand Australia’s submarines will put on production and maintenance capacity in both countries.

This has included US$2 billion (about A$2.8 billion) to the US in three instalments, with a further US$1 billion (A$1.4 billion) in instalments pledged over the next decade.

Canberra has also paid A$310 million to the UK for components needed to build nuclear submarines and has committed an additional £2.4 billion (about A$4.6 billion) over a decade to expand the UK’s submarine production capacity.

Third, AUKUS will consume a growing share of the Australian defence budget, even if the government follows through on its commitment to increase spending to 3% of GDP by 2033.

In 2023, the Parliamentary Budget Office projected annual AUKUS spending to be roughly A$2.2 billion per year over the program’s first four years, rising to more than A$8 billion annually for the next three decades. This means most of the spending is still to come.

There’s a long list of various capabilities required to meet Australia’s future defence requirements. If the Defence budget does not grow sufficiently and AUKUS eats into those programs, the overall investment in these capabilities could become lopsided.

2. A new submarine base in WA

Until the Virginia-class submarines arrive, we still need to make sure our near-term defence needs are being met. We also need to be ready for when our subs show up.

This is where Submarine Rotational Force-West comes in.

The first phase of the AUKUS program involves frequent visits by US and UK submarines to HMAS Stirling in Perth from next year. These subs won’t be formally based in Australia; they will rotate in and out.

But these aren’t mere pitstops. Australians are being trained in how to maintain the ships and handle their weapons. Some US submarines already have Australians serving onboard. These initiatives are helping to prepare Australia to maintain our own nuclear-powered submarines when they come online.

The US is also setting up local operations to provide services, logistics and operational support to these rotating submarines and their crews. This will be the only location outside US and UK territories in the Indo-Pacific where these subs can receive sophisticated maintenance support.

Crucially, these facilities will be beyond the range of most (though not all) of China’s growing missile capabilities…….

3. US submarine availability

Sceptics in both the US and Australia have expressed doubt about Washington’s willingness to sell at least three submarines to Australia beginning in the 2030s, given how much it relies on them and how long it takes to build them.

Indeed, the speed of US submarine production has been under particular scrutiny. The conventional wisdom is production needs to hit around 2.33 boats per year to meet both US and Australian requirements.

There are no consistent public records for the actual production rate, but the estimates are sobering.

New builds have averaged 1.1–1.3 submarines per year since the COVID pandemic, down from a high of 1.9 per year from 2016–19. US Navy leaders anticipate reaching two subs per year by 2032 – still short of the 2.33 goal.

Yet, production rates only tell part of the story. If Australia is supposed to receive in-service submarines from the US, understanding the state and size of the existing fleet is just as important.

In 2016, the US Navy declared it needed a force of 66 submarines to counter growing Chinese and Russian threats – up from a previous requirement of 48.

But since then, the US’ submarine fleet size has gradually declined, with older submarines retiring at a marginally higher rate than their modern replacements (the Virginia-class subs) have been introduced.

This reflects the difficulties Washington has had speeding up production, even with US$15 billion (about A$21 billion) in navy investments since 2018, contributions from the Australian government, and a growing number of Australian companies supporting US shipbuilding.

What’s more, since 2016, between 25–33% of the US submarine fleet has been undergoing maintenance, at significant financial and operational cost. For Australia, addressing that backlog will be as important as boosting US production rates.

Australia is already helping to ease these challenges with investments at Submarine Rotational Force-West and its own shipyards. If the AUKUS partners take full advantage of these developments, this could increase the number of boats available to the US Navy – and, by extension, to Australia.

So, while the US has a mountain to climb to boost sub production, that won’t be the only factor that determines the timeline for Australia’s AUKUS fleet………………………………………………………. https://theconversation.com/five-years-into-aukus-what-do-we-have-to-show-for-it-weve-measured-progress-on-three-key-metrics-289885?utm_campaign=the-daily-39531&utm_content=the-daily-39531_au%7C1%7C39531%7Cc3c55007&utm_medium=email&utm_source=braze&utm_term=whether+our+investments+to+date+are+worth+it