Creating a sustainable naval shipbuilding industry

The Abbott Government is committed to investing in a safe and secure Australia.

9th Dec 2014




SENATOR THE HON DAVID JOHNSTON
Minister for Defence


Creating a sustainable naval shipbuilding industry

The Abbott Government is committed to investing in a safe and secure Australia.

As part of this commitment – and building towards the release of the Defence White Paper – the Government today announces a three point plan that will create a sustainable naval shipbuilding industry that supports shipbuilding jobs.

Firstly, the Government will work with industry to fix the Air Warfare Destroyer program.

Secondly, the Government will create a sovereign submarine industry and avoid a submarine capability gap.

Thirdly, the Government will create a naval shipbuilding industry around a fleet of future frigates - provided industry productivity continues to improve.

This plan recognises the significant value to our nation of a skilled naval shipbuilding workforce.

Conscious of the financial disaster left to us by the former government, we will continue to ensure that our Navy is served with the best capability at the best price.

Announcements about specific programs will be made in due course.

Additional shipbuilding expertise to be inserted into the
Air Warfare Destroyer program

We are taking the next major step to put the $8.5 billion Air Warfare Destroyer program back on track to deliver critical capability for the Royal Australian Navy.

Following competitive procurement processes, BAE Systems, Navantia SA and Raytheon Australia will take on increased roles in the Air Warfare Destroyer program for an interim period. Their increased involvement will drive immediate improvements in shipbuilding performance.

The Government is totally committed to putting this important Defence project back on track and stop the growing cost and schedule overruns by implementing the Reform Strategy recommended by Professor Donald Winter’s Independent Review of the Air Warfare Destroyer program.

This focus on resolving outstanding productivity issues will identify opportunities to improve performance for the duration of the project.

The outcomes of this interim period will also inform the Government's considerations on the Australian naval shipbuilding industry in the context of the 2015 Defence White Paper.

This interim period marks a turning point in the performance of ASC and its partners on this important project and will renew confidence in the future of Australia's shipbuilding industry.

No decisions have yet been made about the long term arrangements for the Air Warfare Destroyer program and the Air Warfare Destroyer Alliance Industry Participants – ASC Shipbuilder and Raytheon – will continue to be responsible for the construction and delivery of the three ships.

We are committed to working collaboratively and constructively with all stakeholders to ensure we realise both the national security benefits as well as the long term benefits of this program for the Australian shipbuilding industry in the most cost-effective and efficient way possible.

 

APDR at a glance