June 29, 2016

ASC. The Competitive Canoe Cargo Cult from South Australia

Clearly having had a "Good Lunch" a jovial “Federal” (but more South Australian) Industry Minister, Christopher Pyne (above) versus a completely astounded Julie Bishop (below) who is the senior Federal politician from Western Australia.


The industrial limbo that has been the Election Period has delayed the reckoning from which full blessings of ASC flow.

South Australia's  ASC, having made its mark building on-time and on-budget, is therefore being entrusted with most of Australia’s current and future shipbuilding business. As they say in France "ASC is Australia's shipbuilder par excellence".

Is not ASC South Australia's Cargo Cult in which Federal Industry Minister Christopher Pyne, is the John Frum? If you build a veneer of political uncertainty during Election times, Federal money, and heavily protected make-work, will come. To further mix metaphors - a shipbuilding Field of Dreams

Without competitive bidding (but total political favouritism) ASC is to build some very large canoes including:

-  2 Offshore Patrol Vessels
-  9 Future Frigates
-  12, though mercifully more likely 6, “regionally superior” Submarines

in ASC’s good time.

The trick is to milk the Federal purse for all its worth and stretch out the work (like the AWD, like Collins maintenance) for as long as plausibly possible.


There appears to be closed shop resistance to competition from other states of Australia. Peter Williams for The West Australian, June 24, 2016, has reported:

"Civmec battled defence contractors

Defence contractors were hostile to heavy engineering firm Civmec [website] entering their space to chase work under the Federal Government’s $90 billion shipbuilding program, chief executive Pat Tallon says.

Previously resources-focused Civmec had not worked in the defence space before announcing last year it wanted to help build submarines and other vessels. The Henderson-based company even built a portion of a submarine hull to show foreign bidders for the $50 million submarine program it could do the work.

Mr Tallon said some other companies did not want Civmec “cutting their grass”.

“They weren't exactly very happy at the idea that we seeking entry to the defence area,” he told a Chamber of Commerce and Industry WA function yesterday.

“Several have tried to distract us from doing this. We have been discouraged more than encouraged and ‘This wasn't the right space’ for us to be in.”

In addition to the submarines, Civmec is interested in the $3 billion offshore patrol vessel program which the Government has said would move from South Australia to WA in 2020.

That would put the company into competition with fellow Henderson shipbuilder Austal, which has built dozens of patrol vessels for the Royal Australian Navy and Australian Border Force.

Mr Tallon said Civmec was leaning towards bidding to build modules for defence vessels from Henderson instead of setting up in South Australia, where the submarines, frigates and some of the early OPVs will be built. That was because the fabrication labour pool in SA might not big enough.


So where does this leave senior politicians from other shipbuilding states, including:

-  Western Australia's Julie Bishop (Deputy Leader of the Federal ruling Liberal Party) regarding submarine and Frigate building? and

-  the Senator for NSW and Defence Minister, Marise Payne?

Might there be somewhat more fluidity in spreading out shipbuilding work after the July 22, 2016  Election?


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