Speech to CCI WA

08 Dec 2016 Speech

Western Australia Defence Conference 2016

Perth, Western Australia

**Check against delivery**

8 December 2016

It is a pleasure to be here today to talk about how you can do business with Defence.

These are exciting times for Australia’s defence industry – times full of opportunity for Western Australia, with both its strategic importance and traditions of defence industry excellence.

Indeed, the future for our defence industry has never been brighter – for the sector is at the very forefront of the Turnbull Government’s agenda for jobs and growth in the Australian economy.

Across the nation, industry is making the transition to high-tech manufacturing, embracing the innovation that will drive our continued national prosperity.

This is where the jobs of the future will be created – and with them the broader growth we need to ensure Australia maintains our position as an advanced economy among the top ranks of nations in the twenty-first century.

As Minister for Defence Industry it’s my job to develop and grow the sector into one of the most important parts of our economy.

It’s an exciting challenge – one I relish.

I want to ensure that when the Government spends Australian taxpayer’s money it is spent on what our serving men and women need.

I want to ensure that this investment provides our service personnel with the best equipment, that it does the most to serve the defence of the nation and – wherever possible – it is spent in Australia.

The security of our nation is the foundation of our prosperity and it’s the Government’s most important role.

We must have a stronger defence capability – and a world-leading defence industry that can underpin our ability to respond to risks and seize the opportunities for growth.

To deliver this agenda, the Turnbull Government is embarking on the largest ever renewal of our defence capability; a renewal that will ensure the Australian Defence Force has what it needs to keep our nation secure in this rapidly changing world.

We will be investing $195 billion over the decade from now until 2025-26 in building our defence capability – while also growing the size of our defence force and strengthening our presence in both Australia and our region.

This is one of the world’s largest defence spends, one that will have an impact on both national security and prosperity for decades to come.

It is, as I call it, our great national endeavour.

And, like any project of this magnitude, it needs to be managed carefully.

The long lead times of much of the process leaves us with no scope for complacency.

Time wasted at the beginning of any project is always time you have to make up at the end.

The same applies to money.

That means we must get things right from the start.

That’s why we now have my portfolio of Defence Industry.

The capability of our defence force will always be our highest priority.

We will never compromise on this.

But we must also maximise the potential for the Government’s $195 billion investment to grow our defence industry to meet our defence needs and become a world-leading exporter.

There are many great examples of successful Australian exporters, including from here in the West.

But the Government believes that we can – that we must – do better.

To realise our twin goals of capability and prosperity our defence industries – including Western Australia’s – have a key part to play in our national endeavour.

Some of the companies you represent form a critical element of our defence industrial base.

Small to medium enterprises from Western Australia are the engine room of defence capability and innovation.

The state’s defence industry already provides as many as 4,000 jobs.

It carried out close to three-quarters of a billion dollars worth of work last financial year.

I expect that number to grow and the work to diversify as the Government implements our continuous shipbuilding program and works with local companies to fully realise the opportunities available in the defence sector.

I see tremendous opportunities for companies that have demonstrated world-leading innovation in the oil and gas sector here in the West, for example, to translate that innovation, and capability into the defence arena, working with local companies with a presence in the defence sector already to help achieve that growth.

This is already fertile ground.

The companies you represent already form fundamental capabilities that guarantee our national security.

You ensure that Australia plays its part in protecting peace in our own region; in Asia, the Pacific and, of course, the Indian Ocean.

You already maintain our ships, submarines and other vital platforms – and will become the hub for our continuous minor war vessel construction.

You already provide the logistical and support services that help sustain ADF operations around the world – and you generate new ideas and technologies to maintain and increase our capability edge.

Western Australia is central to the nation’s trade and engagement with the world.

Western Australia is the point of departure for much of our exports to Asia.

It is Australia’s strategic gateway to the Indian Ocean and beyond.

And its resources sector continues to be a key part of our prosperity.

At the same time, Western Australia has long provided a vital staging post for our nation’s military endeavours.

The first Anzacs sailed from Albany and Fremantle.

In World War II Fremantle became a vital safe harbour, with over 170 British, American and Dutch submarines operating from local shores.

The deep ties between Australian and American forces owe much to those emergency arrangements.

It was on the values and strategic interests we shared then and in the aftermath of the war that the American alliance was founded – and it is on shared values and strategic interests that our alliance endures.

The presence of the United States has long underpinned the stability of the region and, as outlined in this year’s Defence White Paper, the United States continues to be Australia’s most important strategic partner.

Australians and Americans have fought side by side in every major conflict since World War I.

Today, that collaboration continues as together we counter shared threats and support global stability – as we are doing in the Middle East.

The vital importance of our alliance was confirmed during the Prime Minister’s telephone call with US President-elect on the tenth of November, one of the first world leaders to do so.

The Australian-US alliance has seen changes of government on both sides of the Pacific over the past 65 years and continues to strengthen and grow.

We will work with the new administration in pursuit of our common interests and shared goals, secure in the knowledge the alliance delivers real benefits to each country’s defence and national security through training, exercises, combat operations, capability development and, not least, intelligence cooperation.

Australia will continue to invest in capabilities that maintain high levels of interoperability with United States forces.

Ahead of my visit to Washington in October, for example, I announced the selection of Lockheed Martin Australia as our preferred Combat Systems Integrator for the Future Submarine project.

In this role the company will ensure that the submarine combat suite will guarantee that we maintain our vital interoperability with the United States while also protecting sensitive American and Australian combat system technology.

Upon my return, the US announced Australia as one of four regional hubs that will provide maintenance and sustainment for the Joint Strike Fighter project.

Greater cooperation and more opportunities, I believe, are to come.

During his campaign President-elect Donald Trump signalled he would support a major expansion of US military capability.

If fully implemented his plan would increase the US defence budget by some 500 billion US dollars – and see increases to the size of the army and marines, as well as increased numbers of Navy surface ships and submarines and Air Force planes.

This could bring with it remarkable opportunities for Western Australia’s defence industry.

Our longstanding alliance makes us well positioned to grasp this new business, especially with both our countries so similarly focused on expanding and investing in our capabilities.

Western Australia’s defence industry has already demonstrated its ability to support international contracts.

Austal, for example, already has two major contracts with the US Navy.

The first, for 11 Littoral Combat Ships, is worth some four billion US dollars.

Two of the vessels have already been delivered and the project is on schedule.

The second, worth around two billion US, for 11 Expeditionary Fast Transport Vessels is also proceeding smoothly.

Seven of the craft have been delivered and, again, the project is on schedule.

And there are many more examples of Australian and Western Australian defence companies ready to seize opportunities both here and in the United States.

Over the next decade the Government will invest some $2.4 billion in upgrading defence facilities in Western Australia.

The Government’s continuous naval shipbuilding program will provide certainty for long-term investment and ensure Australia retains a sovereign capability to build and sustain our fleet and the jobs that go with it.

After the initial build begins in South Australia, Offshore Patrol Vessel construction will move here in 2020 – along with the building of up to 21 Pacific Patrol Boats by Austal in Henderson – making the state a significant shipbuilding hub for decades to come.

Just last week the OPV project achieved a key milestone with the release of the Request for Tender to the three shortlisted designers.

The Request for Tender will see Damen, Fassmer and Luerssen team up with Australian shipbuilders to try and win this iconic project – it was released on time and has been described as transformational – giving local companies a greater chance to win work.

Similar to Land 400, another multi-billion dollar project which WA can get involved in - the Defence Department is currently coordinating a national road-show to help Australian companies get a slice of the OPV project.

The roadshow kicked off in October and so far the turnout has been fantastic all over the country.

More than 300 people attended the event here in WA last month – it was great to see such enthusiasm.

We are delivering on our commitment – spending money locally where possible, boosting growth, creating jobs and giving our military the best equipment we can.While we look forward to new projects - WA will remain the home base of our submarine capability and a crucial centre for maintaining and sustaining our western fleet.

All of this will require a significant industrial base here in the West to support our national endeavour, providing a breadth of opportunities for Western Australian companies.

Just days ago I opened the new Centre for Defence Industry Capability. The key role of this Centre is to assist Australian businesses to seize the opportunities offered by the Turnbull Government to become part of the national supply chain and promote their export potential.

The CDIC, backed by a budget of $230 million over the next decade, is designed to bring together industry, academia and our other research institutions and the states and territories to deliver better outcomes for both industry and defence.

The Centre will provide business support services nationally, with business advisers in each state ready to help companies such as yours enter national and global supply chains and find new ways to maximise your involvement in defence capability – including capability improvement grants that will enable your businesses to better meet Defence’s needs.

A key part of the Centre’s mission will be boosting our industry’s export potential and helping businesses find more opportunities for export.

Our defence exports of the future will be centred around world-leading technologies developed here in Australia, produced by a highly skilled and technologically adept workforce.

The Government is determined to do what it can to see such enterprises flourish and spread their know-how and drive across the broader economy.

The CDIC will consolidate Defence’s programs to support and promote Australia’s exports in one place and help your companies with business advice to become export ready.

It will be able to help your companies find a place in global trade shows under the banner of Team Defence Australia.

And the Centre will also be able to assist with finding opportunities to supply services and products to global defence primes as part of their international supply chains.

I’d like to appeal to all of you today to take advantage of the Centre’s services, to become partners in our national defence endeavour.

I would also like to remind you of the benefits available through the Defence Innovation Hub.

The Hub, backed by $640 million over the 10 years to 2025-26, is designed to collaborate on innovation activities that will allow us to take projects from the initial concept stage, through prototyping and testing and into service.

The virtual Innovation Hub is open for business and ready to receive online proposals from here and around the nation to help Defence and underpin the broader high-tech industries of the future.

Information on both the CDIC and the Innovation Hub is available from the business.gov.au website – just follow the links.

In closing let me reiterate: this is a time of unprecedented opportunity for the defence industry here in WA as the Government makes an unprecedented investment in defence technology.

We are determined to use the defence dollar to drive a high technology, advanced manufacturing future.

This is reflected in our immediate defence priorities:

Intelligence, surveillance, reconnaissance, electronic warfare and cyber capacity development that will improve intelligence collection and dissemination;

New capabilities to better facilitate defence operations, including command and control systems, satellite communication and simulation; and

New capabilities that will enhance land combat and amphibious warfare, including remotely operated armed reconnaissance aircraft.

I’ve constantly spoken about our great national endeavour today.

As you can see from those priorities, you are part of it.

We want to see what you can bring to the table.

We want to involve industry earlier in our capacity development because together we will create jobs, drive growth and most importantly give our military personnel the best equipment we can – keeping them safe and the Defence force strong..

We have vital work ahead of us – in this truly national endeavour - I look forward to our future collaboration and cooperation.