Part inspired by Anonymous’ May 27, 2022 comment:
Economics
Australian Defence Spending is going to face close examination when the new Labor government runs its upcoming Force Posture Review.
Projects that Labor has made no promises about, are not Labors’ idea, involve minimal local employment, or cannot be linked easily to strategy will be vulnerable to cutting. On all those grounds projects like a range of light and heavy armour projects may be at risk.
An expanded submarine force for Australia under Program SEA 1000 was an idea of former Labor Prime Minister, Kevin Rudd, so should be safer and the AUKUS alliance is valued by Labor.
But cuts in scope and cost of Defence Projects have to be a real risk. This is with the Australian Government’s deficit nearing A$1 Trillion. This is no time for Defence to trot out its wish list of high priced sub options when the Australian public value cost of living, health and welfare more highly.
It is still important to keep SSN program costs in perspective compared to the Australian Government's A$667.3 billion in the 2020-21 Annual budget. See Page 159 of the 2021-22 Budget. Defence accounted for A$34.5 Billion 2020-21 in "Estimates" on Page 161.
Politics
Despite all the rhetoric about savings, Labor and Coalition governments always find money for projects they care about, even if very costly (like the Coalition purchasing F-35As). The Coalition fund projects their big donors like. Labor funds projects that big unions and major employers of unionists like. In this case, if the AUKUS subs are built at Osborne, Adelaide’s ASC Ltd. Large unions (like the CFMEU) benefit.
Also important is Labor's wish to fill the component order books of broader Australian equipment suppliers. This is for the AUKUS SSNs and preceding that, the Hunter-class Future Frigates, all to be built in Osborne, Adelaide, South Australia.
Labor’s high ranking Deputy Leader and Defence Minister Richard Marles will spread the benefits of sub and ship building right across the Australian economy. Marles is from the Right faction of the Labor Party and thus could have easily felt at home in the Coalition. He represents continuity in supporting AUKUS.
Balancing Marles, to a
degree, is Minister for Defence Industry, Pat Conroy at “Outer” (non Cabinet) Minister
level. Conroy, from the Labor Left, may
have been selected (in part) to liaise with the Unions and reassure anti-nuclear
ideological elements in the Labor Party and in the crossbench (including
Greens).
Labor is fully aware substantial
AUKUS sub building work in Adelaide is essential because Adelaide is a new Labor heartland. Labor
won all (but one) Federal seats on offer in Adelaide at the May 21, 2022 Election. Labor
doesn’t want to lose any of these seats.
Also Labor, earlier in
2022, resoundingly won the South Australian State Election. The new Labor Premier Peter Malinauskas probably has a big future if /when he moves to Federal politics. He might
be a future Labor Prime Minister one day.
The Enemy
Against Labor is the Liberals' new Leader, Peter Dutton, the Coalition’s former Defence Minister. Dutton might pursue the line that the AUKUS subs should be fully built overseas to have any chance of taking on China’s encroachments in a timely manner.
If this plays out Dutton could calculate that “Build AUKUS subs
in Adelaide or not?” could split the Labor Party, between Right-Center Naval
Strategic and Left Shipbuilding Industry wings.
Watch this space. These are early days for Labor working on SSNs and AUKUS generally. Surprises are likely.
Pete
ReplyDeleteThanks that is a good summary. I forgot to mention that SA Premier Malinauskus is also from the Labor Right faction, which is dominant in SA. With Marles and Malinauskus calling the shots I’d say AUKUS subs have a good chance of surviving any cuts.
(As an aside though I doubt Malinauskus will quickly go into Federal politics. No matter how talented State leaders seem, you rarely see Federal MPs in a safe seat step aside for them, and a State leader will rarely give up a premiership to risk a Federal marginal.)
I do see one threat. WA Premier McGowan is powerful in Labor, from the Right faction, and is probably owed some favours because the big swing and extra seats in WA gave Labor majority government. None of this changes the political arguments for frigates and subs in ASC, but there will be pressure to shift some defence spending to Stirling. The upgraded SSN sub base West then looks odds on for funding, but SSN Fleet Base East might be waiting a while, especially if money is tight.
GhalibKabir said...
ReplyDeleteHi Pete
One should hope even class A drongos are able to see the occasional ray of sense and avoid playing with fire over critical security matters...
In any case the local build obligation and the 'local source' obligations are best applied once the program gets going and there is a system in place for tier-2 and lower component vendors to have learnt the specification and manufacturing ropes by then.
The first two boats are best built at Barrow in Furness with a sliding timeline that builds up component sourcing from Australia at a manageable pace. This will also help give investment certainty locally and ensure employment ecosystems sustain over 40-50 years.
Else, there is a real risk of a royal pig's breakfast of a situation developing with terrible cost and time overruns. We don't want an Attack class redux 5-10 years down the line with nothing to show for...
Hi Anonymous [at Jun 3, 2022, 9:50:00 PM]
ReplyDeleteThanks for that extra South Australia and Western Australia political info.
An even further complication is the Life of Type Extension (LOTE) project for the 6 Collins subs. That little baby might only be currently costed around A$5 Billion but to prop up the SA and WA submarine industry for 10 years that may increase to A$10 Billion. After that comes the AUKUS SSN build.
Also from 2022 to 2032 (or later) is the 9 x Hunter class Future Frigate build.
Also an Australian hypersonic and/or ballistic SLBM project will be kicking around.
All amounting to around A$70 Billion (not counting the A$200-500 Billion AUKUS SSN project over 70 years - which includes Operations and SSN Base East)
Cheers Pete
Hi GhalibKabir [at Jun 4, 2022, 3:54:00 PM]
ReplyDeleteIndeed Australia shouldn't do an Attack-class redux of
- another 5-6 years stuffing around (till 2028) on "local build" formulas
- before cutting steel in 2030
- before completion of SSN1 in 2036,
- then 2-3 years (2039) till SSN 1 is commissioned.
If we want 2 SSNs fast that means GD EB or HII Newport News Shipbuilding built Virginias https://en.wikipedia.org/wiki/Virginia-class_submarine
rather than stretching the much smaller UK industry resources which, for the next 10 years are concentrating on Dreadnought-class SSBNs.
The UK will suffer a no SSN Completion Gap between about 2027 and about 2044.
Regards Pete
Be interesting if the new ALP govt can repair relations with the French? They may be amenable to that just to stick it up Morrison and his ilk for a bit of revenge. Then, buy Barracuda class nukes. LEU reactor which would probably suit us better than the HEU units in the Brit / US offerings, US combat system and weapons (easy, we already did that with Collins) and smaller crews we can better deal with.
ReplyDeleteKeep an eye out for Suffren doing a "goodwill" visit to the Pacific via Fremantle. :)
Hi Anonymous [at Jun 5, 2022, 9:49:00 PM]
ReplyDeleteGiven the rising China threat its much more important that Australia weapon-buys closer relations with the Pacific nation US then far off France.
Then there's the need to refuel France submarine reactors every 10 years. A job only done in often fickle France. Maybe France in a major war would rate refueling allied nuke subs lower than its own.
Then there's the low number of heavy weight shots (torpedoes, anti-ship missiles, mines) in the Barracuda, only 20 https://en.wikipedia.org/wiki/Barracuda-class_submarine_(France) .
The Collins has 22 https://en.wikipedia.org/wiki/Collins-class_submarine so the critical number of shots metric would go backwards.
With the new capability of Tomahawk or one day hypersonic land attack missiles sought for Australia's future SSN, 30 heavyweight shots would be desirable, ie. 22 torpedoes, anti-ship missiles, mines + 8 land attack missiles.
LEU submarine reactors are a French sales pitch. Ideal for France's limited enrichment LEU land nuclear power reactor economies of scale. Something that Australia, which has no intention of building land power reactors, does not rate highly.
Regards Pete
I would say that French support for Aussie subs seems to be a smart idea given that Malaysia and India operates scorpenes and that Indonesia and the Philippines are at advanced talks with scorpenes, and Indonesia is pushing for their own version of the enlarged-spec scorpene based model of the Rachel's in Brazil. Australia will have better operability with 6 important partners (Inc france) in the indo-pacific that are increasing ties with the US.
ReplyDeleteI wouldn't be too concerned about the refuelling gap. At worst case scenario we would only be missing 1 sub at a time for a month or two at a time which isn't bad considering that the cost of french SSNs are lower that UKUS subs and a few extra units can be used to cover the gap.
Nonetheless I think we have to be realistic that a 200 Billion AUD bill for 8 nuke subs is unacceptable particularly for the tax payer. The attack class debacle was already seen as exorbitant at just 90 Billion. I think a refuelling gap is much more acceptable than 110 billion dollars more just to not have any refuelling. The attack class was pretty much 1/3 American anyway, same for an AUS-spec LEU nuclear barracuda and could fire a reliable supply of tomahawks and mk48 torpedoes from the US.