SEA 1000 WHY OUR SUBMARINES NEED TO BE BUILT IN AUSTRALIA

Whenever I am asked why we should build submarines in Australia, my short reply is that we can’t afford not to.

8th Jul 2013


SEA 1000

 WHY OUR SUBMARINES NEED TO BE BUILT IN AUSTRALIA

Byline: General Peter Cosgrove, AC, MC / Adelaide

Whenever I am asked why we should build submarines in Australia, my short reply is that we can’t afford not to.

The longer answer revolves around three central themes – national security, cost and nation building.

And one other important point that I want to make early in the piece, setting aside the false perceptions, is that in reality we have built and maintained one of the most capable and powerful conventional submarines in the world.

National Security

Australia is a first world economy that needs and can afford a first class defence capability. We are a small nation of 23 million people contained within a vast land mass surrounded by nearly 60,000 kilometres of coastline with critical infrastructure and resources to protect and defend. We have charge of one of the largest marine jurisdictions in the world, with an offshore exclusive economic zone of about 10 million square kilometres.

More than 95 per cent of Australia’s trade by volume is transported by sea. In 2011, Australian exports topped $300 billion or 20 per cent of GDP. We have critical oil and gas resources located offshore that are major contributors to the national economy. In the next few years Australia will be the second, if not the largest, exporter of liquefied natural gas in the world.

In this context, submarines are our most important strategic defence assets. They are covert, agile, have long reach and deploy a powerful set of weapons and sensors. In terms of sea control, they are our best and most effective deterrent. This is critical to the thinking that has long positioned our future maritime power at the front and centre of many Defence White Papers, with bi-partisan support. It is so now and was so during my time as Chief of the Defence Force.

Australia has been operating submarines for nearly 100 years. Our design and construction expertise and shipyard infrastructure, developed in the past 25 years, has today positioned Australia as a world leader in long-range conventional submarine design, manufacture and maintenance.

The high quality industrial capability generated by the Collins Class submarines represents a significant, strategic national asset. And while the genesis of Collins was via a flawed procurement strategy, building them in Australia was not a factor that handicapped the program. Indeed, the experience has given us valuable and highly relevant lessons in future submarine design and engineering.

Current Australian Government policy aims for self-reliance in the direct defence of Australia. That doesn’t mean we should have a full suite of capabilities for every occasion. Nor does it preclude a degree of dependence on allied nations for collaboration on certain technologies. But it is absolutely within our best interests to develop, own and keep as much intellectual capital and capability as possible. The best means of maintaining that capability is to back ourselves in creating a long-term submarine building industry. And by long term, I mean at least half a century or more.

Cost

There is nothing to be gained and everything to lose by dealing ourselves out of an industry we have spent 25 years building.

The best investment return for the Australian taxpayer is to continuously build and maintain our own fleet of submarines. The maths is not difficult. The cost of building a submarine is proportionately small when compared to the expense of sustaining its 25 to 30 year operational life. The through-life support of submarines is typically two to three-times the value of the initial build.

So there is no real advantage in outsourcing the initial submarine build to another country when the real grunt work required to keep the submarine fleet working is carried out in Australia by the same skilled workforce using specialised infrastructure. Quite simply, there is no conventional submarine in the world available for purchase today that can meet Australia’s unique requirements.

Further, the greatest complexity of the future submarine program does not lie in the construction of the hull, but the design, installation, integration and maintenance and upgrade of the ship’s combat and weapon systems – the heart of a submarine’s fighting capability.

The Government’s recent announcement that it will use the United States AN/BYG-1 combat system for future submarine design work is extremely illuminating. The fleet will be fitted with sensitive US systems, which will need to be installed and integrated in Australia for security reasons. It cannot be done in the US, as it doesn’t build conventional submarines. And it makes no sense, even if it was possible, to retrofit the systems in a hull built overseas. It would be high-risk, costly and time-consuming.

It is in the integration of key systems that we maximize our defence requirements and derive the major economic benefits for Australia. So to let another nation build our submarines would also introduce unacceptable risks to national security by potentially diminishing the value, usability, effectiveness, sustainability and future evolution of one of Australia’s most important strategic deterrent and defence assets.

We must maintain control of the design because that provides us with the ability to upgrade and modernise over time. And that will help minimise the cost and complexity of sustaining the fleet through life. To outsource this work would be to export hundreds of billions of dollars of work to supporting another country’s industry and jobs, rather than investing in our own.

It bemuses me that these fundamental considerations are simply ignored by those calling for our submarines to be purchased off the shelf, superficially attracted to a marginally cheaper up front price tag. This is short-sighted thinking.


Nation building

In its formative years of development, Australia excelled at nation building projects. The Snowy Mountain scheme, our national road and rail systems, our ports and the creation of corporations like the GPO, ABC, CSIRO and Telstra were all borne out of visionary policies of a country on the move.

Submarine design, engineering, manufacture and sustainment is a massive industry – with enormous potential for spin-off industries – that will create at its core many hundreds of high-tech, high-skilled jobs that will cultivate long term careers. As a nation, we should not be averse to capacity building by allowing short-term political perspectives to ignore the benefits of embarking upon strategic large-scale projects.

The future submarine project will take a central supporting role in the national agenda for a sustainable advanced manufacturing future with an emphasis on high-end, high-value, low volume activities.

Basing the Future Submarine Systems Centre and the Submarine Land Based Test Site in Adelaide, to pave the way for building of our next generation of submarines, has attracted bipartisan support. The recent critical decision to focus on an “Evolved Collins” and new design options that are likely to meet our future strategic and capability requirements and suspending the options based on military off the shelf designs is a very significant step in the Future Submarine program. This heralds the beginning of a project akin in size and complexity to building the next generation of space shuttles. These will be the biggest and most complex non-nuclear submarines ever built on the planet.

While Australia bowed out of the space industry many years ago, there is no earthly reason for doing the same with the submarine industry.

The fact is – we have the capability. Over the past two decades we have amassed the skills and the infrastructure and attracted the very best defence contractors from around the world to invest here. Many design engineers and high-skilled workers are currently employed nationally. It would be a tragic loss to the nation if we were to lose even half of this workforce and international investors at the conclusion of these projects. Such a boom and bust approach to strategic industry development is inefficient and wasteful. Australia’s defence industry tackled this very issue in the Future Submarine Industry Skills Plan, released with the Defence White Paper.

There are compelling economic justifications for undertaking big national projects that change expectations, create opportunities and fire up the national imagination.

Our future submarine building project will ultimately not confine itself to the next 12 submarines. It sets a course toward the creation of an evolutionary industry – one of continuous build and continuous improvement, ingenuity and innovation. It will certainly be an adventure – but one with a clear and strategic purpose designed to produce economic benefits while protecting our nation’s future.

Let’s use confidence and common sense and build the subs here.


(Peter Cosgrove is Chairman of the Defence SA Advisory Board)

 

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