Submarine Institute of Australia Submarine Science, Technology and Engineering Conference 2017

4^th Submarine Institute of Australia Submarine Science, Technology and Engineering Conference 2017 Opening Address

Tuesday, 14 November 2017

*Check against delivery*

I am delighted to be here at the fourth Submarine Institute of Australia Submarine Science, Technology and Engineering Conference.

A great deal has happened since I spoke to you this time last year. At that point, US President Donald Trump had only just been elected and had committed to a massive expansion of US military capability.

The Turnbull Government, then a year and two months into office, had itself been very active in the defence capability space.

In February, we had released the 2016 Defence White Paper. It laid out the need to strengthen Australia’s security for the more complex strategic environment Australia will face in the years ahead.

It signalled a near 200 billion dollar integrated investment in defence capability over the next decade.

In May 2016, we released the Turnbull Government’s Naval Shipbuilding Plan, which provides enormous opportunity for Australian industry, the community and our workforce.

The Plan provides for a native shipbuilding and sustainment industry comprising 12 new submarines, nine surface combatants and thirty‑three smaller naval vessels – to be built between now and the middle of the century.

We also provided more than 1.2 billion dollars for vital infrastructure in the nation’s shipyards and a further initial investment of 25 million dollars for workforce initiatives and skilling.

This time last year I promised you no complacency in implementing the Naval Shipbuilding Plan.

I noted that any delay at the start would be at the project’s expense at the end and I committed personally to driving the project efficiently – on time and on budget.

I am proud to say, one year on, the Turnbull Government and I are delivering, as promised.

The Naval Shipbuilding Plan is part of the largest renewal of our defence capability since World War Two.

It is our biggest-ever peacetime investment. It sets Australia up with a sovereign defence capability for the next 100 years. Not for a couple of decades, but a century into the future.

Our reasons are both strategic and economic in nature.

I can’t emphasise often enough how our national security and our economic security are inextricably linked.

We are a nation girt by sea. This affords us a strategic advantage and degree of protection that few nations enjoy.

It also means the physical goods we export each year – which the Department of Foreign Affairs and Trade calculated at 525 billion dollars in 2016 – must be carried by sea.

A sovereign, shipbuilding and sustainment industry based on our soil can aid and protect us in this and be an enduring strategic asset for the nation.

Building such an industry is an objective well understood by those who know our history. We have been willing sovereign participants in global and regional security.

They would also know it brings with it a deep economic stimulus for the nation. This is entirely consistent with the Turnbull Government’s economic direction and its support for innovation.

This month the Government launchedThe Workforce Behind the Defence Force campaign to alert industry, communities and individuals to the boundless opportunity offered by this national enterprise in defence industry.

The campaign encourages Australians to seek out its opportunities, to steer their education and training towards it and become part of it.

It encourages Australian enterprises of all sizes to get involved.

The twin aspects of national and economic security have been firmly in our view as the Turnbull Government has set to work on this.

As I have said on numerous occasions, a 90 billion dollar continuous shipbuilding program does more than provide for an onshore continuous build program for naval vessels.

It enhances and trains our construction and sustainment workforce to be world class.

It brings real job opportunities and offers real support for industry to be defence industry participants and exporters.

Contrast this, if you will, with the record of the Gillard-Rudd-Gillard governments, who over six long years failed to commission a single naval vessel from an Australian shipyard. Not one.

That was a hiatus we did not need, and reflected a lack of commitment not only to sovereign defence capability but a shortfall in ability to run the economy.

The Turnbull Government has turned that on its head. Even our critics must privately concede that we have acted with decisiveness, foresight and commitment.

The Naval Shipbuilding Plan is a blueprint for both implementation and reform. It describes what we must have in place if we are to achieve productivity advances in Australian shipbuilding and put downward pressure on costs – something that is never easy, but is crucial.

Our work to date embodies reform.

We have established Australian Naval Infrastructure Pty Ltd – achieving the structural separation of ASC Pty Ltd.

We are delivering on our commitments to workforce expansion and skills development. A Strategic Workforce Plan for naval shipbuilding is in the works.

We have committed to a 100 million dollar infrastructure investment in Western Australian naval shipyards.

We have secured the purchase of the Common User Facility and surrounding land at Osborne Naval Shipyard, South Australia.

We have unveiled the design, turned the first sod and Lendlease has commenced mobilisation works on-site for the new surface shipbuilding yard in Osborne.

And we are delivering on our commitment to invest 24 million dollars in the Cairns Marine Precinct upgrade in Queensland.

We have made an initial commitment of 25 million dollars in announcing the establishment of a Naval Shipbuilding College, which commences on January 1^st 2018. The analysis of the tenders is currently underway and the Government will make the announcement of the preferred supplier in mid-December.

In capability terms – we have accepted delivery of the first Air Warfare DestroyerHobart.

We have chosen and finalised the contract with Naval Group Australia to design our 12 Future Submarines. Lockheed Martin Australia has been chosen as Combat System Integrator for the Future Submarines.

We have selected and signed a contract with Austal Ships Pty Ltd for design and construction for the Pacific Patrol Boat replacement Program. Steel has been cut and work is well underway for the first of 21 vessels at Henderson in Western Australia.

Australian company CEA Technologies has been chosen to upgrade the radar capability of the Anzac class frigates, and the CEA radar has been mandated for our Future Frigate capability.

Saab Australia has been selected to build the tactical interface for the new Future Frigates and the combat management system for future non‑combat vessels.

We are currently undertaking a tender process for the selection of designers for the Future Frigates and the Offshore Patrol Vessels.

This is real progress and demonstrates what happens when a reforming Government acts with decisiveness and energy.

It gives confidence and certainty and a clear role for industry.

It comes with extensive government support and practical guidance from the Department of Defence.

This means Australian industries, however small, are in a better position to learn, for example, from global primes.

Overall it shows how to transition global supply chains to Australia and accelerate our transition to a high-tech manufacturing future.

The focus of this Conference is Australia’s Submarine Program, and the continued delivery of our potent and agile Collins submarine capability while we design and deliver the Future Submarine.

Australia’s recognition of the need for sovereign submarine capability is embedded in our earliest experiences as a nation and our history of contribution to international security.

Australia ordered its first two submarines from Britain in late 1910, following deliberations as to whether we should assemble or build our submarines here, or buy them from abroad.

The early submarines AE1 and AE2 arrived in Sydney in May 1914, after the longest submarine transit of the time – sixty days at sea over thirteen thousand miles.

At the outbreak of the First World War, both vessels were sent to German New Guinea. On 14 September 1914, a day after the official German surrender of the colony, AE1 failed to return from patrol. To this day, the Submarine Institute of Australia continues the search for the AE1 and her crew, and I acknowledge the Institute for its ongoing efforts.

AE2 went on to become the first allied submarine to penetrate the Dardanelles. From 25 April 1915, AE2 remained at large in the Sea of Marmara. It had provided a much-needed boost to the morale of our land forces ashore in Gallipoli. AE2 was lost soon after, suffering irreparable damage in action.

Efforts to re-establish Australia’s submarine capability after the First World War were marked by the arrival of six J-class submarines from the UK in 1919. In mid-1929, came the O-class submarines, Oxley and Otway, also from the United Kingdom. In both cases, however, tight fiscal conditions saw them scrapped or returned to Britain.

Our modern submarine history started with the acquisition of the Oberon class submarines, approved in 1963. In 1971, a further two were ordered.

The Oberon fleet proved very capable, and reversed the opposition of many to submarines, opposition that had been shaped by experiences with previous classes.

The increasing proficiency of the Oberons at sea was matched by growth in the sophistication of submarine support arrangements ashore. Cockatoo Island Dockyard developed the foundations and skills to competently refit the submarines.

Australia also developed the capability to implement a comprehensive weapons update program. It replaced straight running mark 8 torpedoes with the US mark 48 torpedo and sub-launched Harpoon missiles.

Largely locally developed and implemented, this update program was highly successful and, along with the quality of refit work undertaken at Cockatoo Island Dockyard, demonstrated the capacity within Australia to support its own submarine capability.

The Oberons also emphasised the valuable role our submarines could fulfil as strategic defence assets, with the capacity to deter as well as respond to aggression.

In 1987, the Australian Submarine Corporation, now ASC, began the task of constructing what was then the most sophisticated conventional submarine in the world.

The construction of HMAS Collins, the first of the Collins class, commenced in Adelaide in 1990 and was delivered in 1996.

In all, six Collins class submarines were constructed in Adelaide, with the last delivered to the Navy in 2003.

Now the challenges with the Collins class have been well documented, but they undeservedly remain the excuse used by many, to deride the capability of Australia to again build a world-class submarine.

Our allies have had no such view and have always respected the Collins class as a very capable submarine.

The vast improvements in sustainment that have been made since, now allow us to deliver world-class availability from the Collins fleet.

John Coles stated in his Beyond Benchmark report of May 2016 that ‘a program once considered a “Project of Concern” should perhaps now be treated as an “Exemplar Project”’. This reflected the tremendous gains made by Defence and Industry, working together, to deliver vital capability to our nation.

Having demonstrated consolidated improvements in sustainment, the Collins Program was removed from the Projects of Concern list on the 4^th of October, this year.

The Government is determined to maintain the capability of the Collins fleet. In early October, I, announced two projects that will see the Collins maintain its capability edge.

The two major upgrades include the submarine's ship control system and the communications capability.

ASC, Saab and Raytheon, our prime partners for the remediation control and communications system enhancements, again continue to demonstrate the world-class expertise that Australian industry can provide to our economy and defence of our nation.

This, again, has an economic benefit. It will employ 120 people per year, on average – across South Australia, New South Wales and Western Australia.

The projects will inject approximately 540 million dollars into the Australian economy over the next 20 years, with 300 million dollars going into South Australia, 65 million dollars to New South Wales, and 175 million dollars to Western Australia.

We do not talk about the activities undertaken by our submarines, but all can be confident that the Collins class can be deployed in the highest-end operations, and that it has the enduring respect our allies. It is a world-class submarine.

In April 2017, The Australian National Audit Office tabled its report on the Future Submarine Competitive Evaluation process. It found that Defence designed and implemented an effective process to select an international partner for the Future Submarine Program.

The General Security Agreement and the Framework Agreement concerning Cooperation on the Future Submarine Program – both are treaty-level agreements between Australia and France – have now entered into force.

On 9 July this year, the Prime Minister opened ‘Hughes House’, the Future Submarine Office in Cherbourg. This is a purpose-built joint facility where Commonwealth, Naval Group, and Lockheed Martin Australia staff will work on the concept and preliminary design of the Future Submarine. A pre‑sizing activity was completed in September 2017, with solid agreement on the initial sizing envelope of the Future Submarine. It happened on schedule.

Naval Group Australia opened its headquarters in Adelaide on 30 August 2017.

This was followed by a successful Preliminary System Requirements Review, which marked the end of Functional Analysis, the first phase of design, and allowed entry to the next phase, again on schedule.

Preliminary design of the submarine construction yard in Osborne is nearing completion, and concept design will soon commence with the aim of starting ground works in September 2018.

More than 1700 people attended seven industry days conducted around the country, for briefings on the program and its progress. This helped ensure awareness of the opportunities that exist for Australian industry and how Australian companies can be involved.

The next phase of design, the Feasibility Studies, has commenced. We are positioning more Australians in France to gain knowledge and expertise that can be brought back to Australia. This will directly contribute to our sovereign capacity to build, operate and sustain our Future Submarine fleet in decades to come.

Nation‑wide industry involvement will be essential to the successful delivery of this major program.

I re-emphasise – every submarine in the Future Submarine program will be built in Australia, by Australians.

Australian industry involvement in the program has already started. Three Australian companies were engaged in August to conduct the early survey work of the submarine construction yard site at Osborne.

Australian industry will play a role in completing the design of the submarine construction yard, and in building the yard from late 2018. Australian industry involvement in the supply chain for the Future Submarine will also be essential to maintaining a sovereign capability in Australia.

This too will mean the creation of thousands of local jobs. We expect to sustain an average of two thousand eight hundred jobs as we construct the Future Submarine fleet.

Many young Australians who are currently finishing high school will be the apprentices laying foundations for where these large submarines will be built. They will construct the halls where the submarine sections will be joined. They will certify the berth from which this future fleet will sail.

Given our commitment to the continuous build of submarines and ships, young Australians in school today can look forward to exciting and varied career opportunities across the national naval enterprise we are building.

Engineering, technical roles, program management, commercial roles, procurement and other opportunities will provide career paths for young Australians. They will make a vital contribution to our nation’s national security.

Delivering on the Government’s Naval Shipbuilding Plan is about building ships and submarines. But as I indicated, this construction program is about more than this. It is about our economic future. About using the skills we have now, to advance a naval shipbuilding industry into the next 100 years. It’s about becoming a shipbuilding and submarine building nation. In the first row of nations in the world.

It is designed to strengthen what we already have, what we are capable of, and to showcase our potential at an international level.

The Plan, and the enterprise, is also about developing the skills and momentum to provide opportunities for Australians, in Australia.

We want a sustainable industry with national capacity and international reach, from which we can gain enormous certainty, opportunity, pride and security.

Thank you for having me here today. I wish the Submarine Institute of Australia much ongoing success. I commend not only your conference this year but your endeavours to raise awareness among Australians of the importance of sovereign submarine capability.

For those of you visiting, I trust you will enjoy your time in my home city of Adelaide. As I’m sure you are already finding, this is one of the world’s most liveable and delightful cities. It is also one that will be playing a very big role in the economic and strategic security of the nation for 100 years to come.