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Read all the latest news from Brendan O'Connor MP


November 09, 2021

Thank you for the invitation to speak at this event, the 6th SIA Submarine Science, Technology and Engineering Conference.
I would love to be in Adelaide in person, but unfortunately covid restrictions have meant that is not possible, so I am speaking to you today from Melbourne.
I haven’t been able to travel to Adelaide for a while, but the last time I was there I visited the Osborne shipyards and met with those involved in our shipbuilding programs.
Despite this being a virtual presentation, I look forward to some personal engagement in the Q and A segment to follow.
This conference comes at a time where submarines are, for the first time, a BBQ stopper topic for the broader population outside of Defence.
Events such as this are important as we consider the proposed use of nuclear powered submarines.
The conference’s theme asks how can Australian academia and industry provide a capability edge?
Rather than a capability edge, I’m afraid to say as things presently stand, we risk a significant gap in our underwater capability.
With the announcement of AUKUS we now start a new proposed submarine program from scratch.
I say proposed because there is no contract, no plans, and any decision is more than 18 months away.
This is a Government that has quite rightly been accused of secrecy when it comes to Defence and other areas of critical public policy.
With the AUKUS deal, however, it’s not that they won’t disclose details – they just don’t have any.
You can’t hide a plan you don’t have.
Labor has offered bi-partisan support for the AUKUS partnership and the procurement of nuclear powered submarines from the beginning.
Labor leader Anthony Albanese wrote to the Prime Minister to call for a bi-partisan process of oversight to be established, which would continue should Labor win Government at the next election.
Unfortunately, but not unsurprisingly, the Prime Minister didn’t take us up on our offer. 
Despite this, we will continue to hold the Government to account on what is likely to be the largest procurement in Australia’s history.
The last minute insertion of a mandated Australian Industry Content into the Attack Class contract, and recent reports that the current Defence Minister is prioritising schedule over content, were important factors in our offer of support.
Federal Labor want to ensure that Australian industry is represented at the start of negotiations rather than as a potential afterthought.
The Government botched the $90 billion Future Submarines program from the beginning, and now they are in a position where they have no new contract for submarines, no date for delivery for any proposed new submarines, and a fleet of Collins Class submarines that are expected to stay in the water until the middle of the century.
In the recent Senate Estimates Navy Chief Vice Admiral Noonan warned that hull fatigue of the ageing Collins Class submarines could lead to "operational restrictions" and a defence capability gap in the region.
With the Collins Class submarines potentially in the water for another 30 years hull fatigue is a significant risk for these ageing vessels.
Defence warned the Government back in December 2013 when they first came into power that a decision on Life of Type Extension needed to be taken by mid 2015, yet it took until this year, 8 years later, before that decision was finally made.
While these vessels are now confirmed to go through Life of Type Extensions beginning in 2026, there is too big a gap between the first LOTE and the first of the new submarines becoming operational.
Given the evidence by the Navy Chief in Senate Estimates and views of Defence experts generally the Government’s plan has no credibility.
The capability gap is obvious for all to see.
Federal Labor has welcomed the decision to acquire nuclear submarines and agree they will be our best option, but at what cost when will they be delivered and what are we to do until then?
We have all been witness to the Prime Minister’s mishandling the diplomatic side of this announcement and the subsequent fallout.
We have the French, an important ally in the region, feeling betrayed and the American President calling our handling “clumsy”.
The Foreign Minister, moreover, is undertaking a tour of our region to calm anxiety about the AUKUS partnership.
Currently AUKUS hasn’t changed anything in terms of our Defence capability, it has just raised questions the Government has to date failed to answer.
So again, rather than a capability edge, we risk a significant capability gap.
And this gap is further widened through a current lack of the skills and knowledge needed for these proposed submarines.
And for those skilled people we do have now, we risk losing their talents as we wait years for these new submarines to begin the building process.
I see a broadsheet today has sought to suggest that Labor would sacrifice defence capability over jobs.
That is nonsense.
Our first priority will always be to secure the most effective defence capability to defend this nation.
In doing so, however, wherever possible, we must aspire to building sovereign capability to reduce our reliance on other nations particularly in times of trouble.
That is just common sense.
We heard in Senate Estimates there were as many as 1500 workers on Future Submarine program who no longer have a job.
It was revealed that there are 546 shipbuilding workers on the Future Submarines program affected by the cancellation, yet ASC Pty Ltd, who the Federal Government said would redeploy those workers, has only been funded to employ 300 workers for three months through the newly created Sovereign Shipbuilding Talent Pool.
In addition, there are up to 600 workers on contracted work for Australian Naval Infrastructure with no job certainty – and no government support.
Not only is it a difficult time for those workers, we cannot afford to lose their knowledge and skills.
Our workforce, both onshore and in the submarine force itself, need to increase dramatically, with a large number of nuclear-trained engineers and technicians.
We will need to more than double the present number of submariners and ensure that we have a senior and appropriately experienced workforce available when these new submarines are operational.
If our highly skilled workers in this industry face years of meaningless, unproductive work, we risk losing them to the mining industry or other lucrative industries.
Defence has confirmed that ship building jobs won’t come online for another 6 years.
The Government has said that there will be jobs for those who were working on the Future Submarines program, but what will those workers be doing for the next six years?
We need a detailed, actionable plan from the Government for these workers so we can preserve and develop their skills and knowledge to ensure we have the talent required when the time comes to build the new submarines.
These are uncertain times for businesses and their employees in the defence industry.
This goes beyond just those employed by Naval Group, but includes the small businesses in the supply chain who were gearing up to work on this program, who have now lost millions of dollars.
Defence has confirmed that contracts for 60 SMEs, working on the Future Submarines program worth $120 million, have been cancelled, as well as the cancellation of 35 contracts worth up to $150 million with Australian Naval Infrastructure for work that has ceased.
I feel for those who have lost money, time and foregone future work only to have these contracts torn up.
These are the businesses that Brent Clark from AIDN was referring to at the recent Senate inquiry who “were gearing up for years to get into this program and now that’s gone,”.
And importantly he went on to say that these small and medium businesses “need to know what is going to be happening today, and they need to know the whole time.”
These are the consequences of Government decisions, and the way those decisions were handled.
Labor has always been committed to Australian Industry Content to support and build a sovereign Defence industry.
If elected, Labor would ensure AIC would not be an afterthought, and such requirements would be written into Defence contracts.
Currently we don’t know what type of submarine we are getting, let alone what the local content of any proposed submarines would be.
We also don’t know what the AUKUS submarine deal will mean for South Australian jobs.
In November 2017, former Defence Industry Minister Pyne promised that shipbuilding projects would create 8,000 direct jobs in South Australia. Following the AUKUS announcement the Government released a factsheet spruiking the 5,000 jobs that the Government’s investments in the Naval Shipbuilding Enterprise will support by 2030.
This figure was used as recently as last week by Senator Birmingham.
The recent Senate inquiry however revealed that the workforce baseline would be further revised.
On those figures alone it looks that South Australia has lost 3000 direct jobs and depending on the revision, possibly more.
If you were a worker who left Holden to go and work on submarines after this government shut down the car industry, you would be feeling a strong sense of déjà vu.
With the Australian Government spending $270 billion over the next 10 years spent on defence, Labor wants to see a commitment to growing our sovereign defence industry with a focus on local jobs.
It is little wonder it has risen under this government due to budget blowouts.
It is pretty rich the Government claims their Defence spending to GDP is higher when a big chunk of that is the $5 billion wasted on the Attack Class.
Frankly, you don’t get to boast about your increased Defence expenditure when your cost blowouts run in the tens of billions of dollars.
So this government, having made the big announcement now has questions to answer.
It needs to explain to this industry and to this nation what it plans to do to address the capability gaps, the workforce shortages and the lack of industry involvement.
Thanks again for your invite to talk with you today and I look forward to seeing more of you face to face in the coming weeks and months.