Press Conference, Rockwell Collins

CHRISTOPHER PYNE: Thank you for coming. It’s great to be here in North Sydney with my partner and colleague Trent Zimmerman, and visiting Rockwell Collins who are a stand-out company in terms of taking part in the massive joint strike fighter program, and not just here in Australia but across the world. Today I’m viewing the creation of the 100th lens, if you like, of the eyes of the Joint Strike Fighter: the piece of equipment that allows the Joint Strike Fighter to see the entire space around themselves, the battlefield if you like, to identify threats and then engage with those threats to destroy them, to communicate with all the other platforms in the area; whether it be land or sea or other air based platforms.

This is a great story for Australia; the Rockwell Collins is part of the global supply chain of the F-35. This is a $18 billion project for Australia because we’re purchasing 72 of the Joint Strike Fighters, we’re a partner country.

Thirty-two businesses around Australia have already benefited from being part of the Joint Strike Fighter program, earning over $800 million of value for the Australian economy. We expect that to rise to between $2 billion and $5 billion by the mid 2020’s, and companies like Rockwell Collins are bidding to be part of the international supply chain that provides these lenses for the eyes of the Joint Strike Fighter to all 3000 of those particular platforms around the world in the 14 countries that are part of the Joint Strike Fighter project.

I’ve just returned from Washington where I’ve been meeting with the joint program office of the F-35 to talk to them about how Australia might be able to do more of the maintenance and sustainment in the Asia Pacific for the joint strike fighters.

We’ve already won the right to be the maintainers and sustainers of the engines, of the frames, and of 64 out of 65 of the components that the United States has already decided will be maintained and sustained in the Asia Pacific. That is worth billions of dollars over the next few decades to the Australian economy, and I’ll be working with the United States to press our case to be the Asia Pacific hub for the maintenance and sustainment of things like the product that’s produced here at Rockwell Collins, and there’ll be decisions made about that mid-year and then again in the next 12 months, and Australia will be competitively bidding.

So it’s another great success story in terms of Defence Industry, which has had a buzz for the last 14 months since the white paper was announced by the Government. For the first time in living memory, Defence Industry has been showing up in the national accounts as one of the drivers of the economy. So it’s a very exciting time to be here, to be part of what is a renaissance of manufacturing and high value, high technology, advanced jobs in Australia.

Any questions?

QUESTION: With the sort of work occurring at Rockwell Collins and the $10 million investment at Bankstown Quickstep Holdings, do you see more job opportunities for New South Wales Defence Industry?

CHRISTOPHER PYNE: There’s absolutely no doubt that there’ll be more job opportunities here in New South Wales and across Australia. When I was in Washington I had lunch with five different primes, big US companies, and I just asked them casually what their plans were for the expansion of their Australian workforce. Between those five companies, it added up to 5000 Australian jobs because the rest of the world is looking at the Australian commitment to our military capability and our build-up, and recognising that they want to be here as part of that.

The Australian military build-up of $195 billion over the next 10 years is one of the largest in the world. The naval ship building contracts that I’m responsible for are the largest ones of their kind in the world. There is no other country purchasing 12 and building 12 submarines, for example.

So, the rest of the world is really engaged with this part of economy. That means jobs here in New South Wales because of course a lot of the very high technology advance manufacturing is done right here in Sydney and in the Hunter Valley as part of our Defence establishment. So there are real opportunities. Here at Rockwell Collins there’s a likely increase of 20 to 30 jobs just on this particular site because of the contracts that they’ve been winning around the product that we’re discussing today.

QUESTION: Do you know what the problem with HMAS Canberra and Adelaide is yet?

CHRISTOPHER PYNE: Look, we have thousands of pieces of equipment and platforms across the Australian Defence Force. There was a propulsion issue identified with one of the LHDs. The other LHD was checked to see if it had the same issue. Out of an abundance of caution both are being maintained at Garden Island to address that issue. It isn’t a serious issue. It doesn’t put Australia at any risk whatsoever and it is perfectly normal when you have thousands of pieces of equipment and hundreds of significant platforms that you’d be continuing to maintain and sustain those platforms.

QUESTION: Are they still under warranty and do you have an idea of cost, of how much this could cost?

CHRISTOPHER PYNE: Well this is one of the greatest beat-ups of my short political career in Defence Industry. It seems to have become an obsession of some people that this is somehow the major story in Australian Defence. The major story in Australian Defence right now is the extraordinary build up of our military capability. There will from time to time be necessary maintenance of our platforms. So that’s all that’s happening with the two LHDs right now. Of course there are contracts, there are warranties, there are negotiations between Defence and contractors. I’ll leave that up to the good boffins in Defence to work those matters out. I’m focusing on things like today’s hundredth piece of the Joint Strike Fighter that we are supplying. It’s a great success story. It’s creating jobs and growth and investment in Australia and will continue to do so for decades into the future thanks to the Turnbull Government’s investment in our military capability.

QUESTION: Ahead of the budget is borrowing full welfare and health good policy?

CHRISTOPHER PYNE: Look I’ll leave budget questions to the Treasurer and the Minister for Finance. We tend not to talk about the budget before it’s released. Malcolm Turnbull has an old fashioned orthodox view which I subscribe to that the budget is when you announce things in the budget and people have to wait until budget night to find out.

QUESTION: Generally do you have an opinion on borrowing [indistinct]?

CHRISTOPHER PYNE: Well generally my opinion is that we are doing well in bringing under control the debt and deficit that was left to us by the previous Labor Government. Luckily we have a government that’s committed to savings measures, to reducing the tax burden on companies and individuals, we’ve delivered individual tax cuts, company tax cuts in the last 12 months. We’re getting financial bills through the Senate as well as things like the Australian Building and Construction Commission and the Registered Organisations Commission, reforming child care. This is a government that is chalking up one success after another. And in the budget you will continue to see that we are bringing debt and deficit under control which if Labor had been elected, they had planned to blow out by $16.5 billion just in what they announced in the election campaign.

QUESTION: There has been a lot of talk about good debt and bad debt today. Are we being primed for perhaps a larger than expected deficit or perhaps a slower return to surplus?

CHRISTOPHER PYNE: No I think what you’ll see in the budget is a continuing, steady, sensible return to surplus over the period of the forward estimates. The Treasurer of course make the announcements on budget night. But we are a government that is bringing the debt under control, the deficit under control. We’re not doing that in a way that puts a handbrake on the economy. We’re maintaining our AAA credit rating. From an economic point of view this has been a very successful government and as I said if Labor had been elected, they’d already planned to blow out the budget by $16.5 billion because they were trying to buy the election or scare voters into voting for them in the Mediscare campaign.