Speers Sky News Live

E&OE TRANSCRIPT

Interview with David Speers, Sky News Live Speers

15 November 2018

SUBJECTS: Offshore Patrol Vessels; Military Capability Build-up; Strategic Partnering Agreement; Redevelopment of the Manus Island naval base; Australia's embassy in Israel

DAVID SPEERS: Back here today, some progress for the government and for he navy with the commencement of work on the offshore patrol vessels. This is the fleet of 12 offshore patrol vessels that are going to be built; the first couple of them at least in South Australia and the rest in WA. And today, the Defence Minister Christopher Pyne has announced that they are going to be called the Arafura Class Offshore Patrol Vessel. He joins me now from Adelaide. Thanks very much for your time this afternoon, Christopher Pyne. Tell us…

CHRISTOPHER PYNE: David, it’s nice to be with you again.

DAVID SPEERS: Well excellent. This is the start of a $90 billion shipbuilding program that we’ve heard a great deal about. Just tell us a little bit about the offshore patrol vessels firstly; when are they going to be ready and what will they be used for?

CHRISTOPHER PYNE: Well it’s the second part really of the $90 billion build-up of our military capability in the Navy because of course, we’ve already started the Pacific Patrol Boats – the Guardian Class at Henderson about two years ago. But that's about $400 million, whereas today’s beginning of construction of the offshore patrol vessel is $3.5 to $4 billion, it’s 12 vessels replacing the Armidale Class. It’s an 80 metre long vessel, I should say, with weapons and it has significantly long endurance and capabilities. It will be a very important part of our Navy and as you say, it is another manifestation of the $90 billion build-up of our military capability in the navy. Added to that, the anti-submarine warfare frigates – the Hunter Class, and of course, the submarine class which is the last class, yet to be named, which we’ll announce hopefully when the Strategic Partnering Agreement is signed with the French in the near future.

DAVID SPEERS: What’s the near future? Just on that, when is that going to be signed?

CHRISTOPHER PYNE: Well as you know, we are working at the moment under the submarine contract, under design and mobilisation. It’s been two years and that work is going well. I’m about to turn the first sod at the submarine yard at Osborne North in the next month. So nothing has been slowed down as a consequence of not finishing the Strategic Partnering Agreement. It’s important to get that right because it’s a many decades long project and multi billions. But the design and mobilisation contract means the submarine project is on schedule and on budget and this morning’s beginning of construction of the offshore patrol vessels is- there’s about a thousand direct and indirect jobs at Osborne for the first two vessels, and then moving to Henderson in 2020 to build the next 10. So the continuous naval ship-build is well underway in Australia.

DAVID SPEERS: [Talks over] Okay, but just on the submarine agreement, what is the sticking point and again, when will that be signed?

CHRISTOPHER PYNE: Well there’s no particular sticking point, it’s a negotiation for a $50 billion contract that’ll last at least three decades. It's not something you want to rush into. It's important that both France and Australia feel that the partnership that we are creating around submarine building is fair for everyone. It will be signed when it's ready to be signed, but the submarine project is not being delayed or slowed because of the Strategic Partnering Agreement negotiations because that contract continues under the design and mobilisation contract which was signed two years ago.

DAVID SPEERS: I see the AMWU very happy of course that works beginning on the offshore patrol vessels today - the Arafura Class as they will be called - and happy obviously about the jobs this will generate. But they do want a commitment from you that no further jobs will be lost at ASC. Can you give that?

CHRISTOPHER PYNE: Well the ASC is transitioning from the Air Warfare Destroyer Project which is finishing to the Offshore Patrol Vessel Project. Redundancies are happening at the ASC because Labor made no decision in six years to build any ships. We're building 54 under the Coalition Government for the last five years, there’s a very big difference.

DAVID SPEERS: Why would they be laying people off then?

CHRISTOPHER PYNE: What’s that?

DAVID SPEERS: Why would there be redundancies if there’s all these ships to be built?

CHRISTOPHER PYNE: Well because it takes a long time to stand up a project like the offshore patrol vessels. But people are transitioning from the Air Warfare Destroyer Project to the construction of the Osborne South Shipyard, which is almost- well it's well underway and at least one of the sheds is close to finishing. The Osborne North Submarine Yard, which I'll turn the first sod on in December. There's a hundred new positions at the Collins Class sustainment and maintenance of the submarines. There's a hundred new scholarships at the naval shipbuilding college and there's a thousand jobs created through the Offshore Patrol Vessels Project which has started construction on today. So the truth is that all those people who work in shipbuilding today, will have jobs in the future, but there may well be a gap because of the Labor Party. There may well be redundancies because of the Labor Party, but I couldn't have done more and neither could the government to fill in that valley of death and the union knows that and so do the workers who are very excited at the ASC because of the opportunities that we've created.

DAVID SPEERS: There are still, I mean, there is no doubt that over time there’s going to be a lot of jobs there. There is still criticism on the submarine deal though, that it's so expensive, it still hasn't been finalised that agreement you talk of and are we really going to get the best submarine for Australia. It is untested this previously nuclear sub being turned into a conventional sub and so on. Are you still sure it's the best sub for Australia?

CHRISTOPHER PYNE: Well most of that commentary is ill-informed and wrong because of course, the French Naval Group builds both nuclear and conventional submarines and the Barracuda Class is the basis for an Australian submarine, it's not the exact same model because we want the regionally superior submarine for the Indian and Pacific oceans. So it's not true to say that we are taking a sub that was nuclear and trying to make it into something different. It is on track. The idea that somehow we're behind schedule is wrong, but there are a lot of experts, so-called in Australia on submarine building and on submarines and most of them are quite frankly, simply out of touch with what's actually happening. The design and mobilisation contract is well and truly underway; it's been in place for two years. The submarine yard at Osborne North, as I said, I'll turn the first sod on in December, on schedule and on budget. The design of the new submarine is on schedule and on budget. When we sign the Strategic Partnering Agreement is really quite immaterial because the contract is operating under the design and mobilisation contract. So those people who profess to know about submarines, most of them are well and truly out of their depth, pardon the pun.

DAVID SPEERS: Well I like that pun. Can I ask you about the- there was a report the other day in relation to the Pacific, that Australia is going to build a new navy ship that will cruise around the South Pacific, helping with natural disasters and so on; what can you tell us about this new ship? How far off is that?

CHRISTOPHER PYNE: Well as part of our Pacific step up which the Prime Minister spoke to in Townsville last Thursday, our intention is to as part of that Pacific step up or pivot as I called it a week ago…

DAVID SPEERS: [Talks over] You coined that term?

CHRISTOPHER PYNE: … will build a large hulled vessel for humanitarian and disaster relief, which will operate semi-permanently in the south west Pacific. In which case it will return to Australia for maintenance and sustainment, but basically operate all the time in the south west Pacific, building resilience, building capability and responding to natural disasters. It's a great idea. In terms of the type of vessel, where it will be built - those decisions haven't yet been made. I strongly anticipate it will be built in Australia.

DAVID SPEERS: [Talks over] Would it be on the scale of the offshore patrol vessel? One of these Arafura-

CHRISTOPHER PYNE: It will be a large hulled vessel operating in the south west Pacific, built in Australia. But that tender process hasn’t yet begun.

DAVID SPEERS: Okay. But something, you envisage, something along the lines of these new offshore patrol vessels, something of that size?

CHRISTOPHER PYNE: Probably larger than that.

DAVID SPEERS: And cruise-

CHRISTOPHER PYNE: Quite a bit larger than that.

DAVID SPEERS: Okay. Okay. Well, cruising permanently-

CHRISTOPHER PYNE: [Interrupts] Because the offshore patrol vessels are 80 metres and while they’re significant-sized, a large-hulled vessel is substantially bigger than that.

DAVID SPEERS: And I’m assuming it would be not just- I mean, I get your point that it would be there for natural disaster relief and so on, but we’re talking about an armed warship here, aren’t we?

CHRISTOPHER PYNE: Well, how much it needs to be weaponised is something I will take advice on from the Navy. Its primary purpose would not be military. Its primary purpose would be humanitarian and disaster relief. We have platforms – the three Air Warfare Destroyers, the nine future frigates, of course, the current Anzac frigates, the helicopter carriers, also known as the landing helicopter docks. We have substantially weaponised platforms now, and the six Collins class submarines. So, the intention of this HADR vessel is not to be weaponised, it’s to provide disaster relief and build resilience in our southwest Pacific neighbours…

DAVID SPEERS: [Talks over] Because you- do you-

CHRISTOPHER PYNE: …against natural disasters.

DAVID SPEERS: Do you anticipate if it were to be a weaponised warship - you’re going take advice on this - cruising permanently around the South Pacific, countries like China and so on may not be all that comfortable with Australia’s presence at that scale?

CHRISTOPHER PYNE: Well, Australia already has a substantial military presence across the southwest Pacific. We already undertake exercises with our neighbours, with the United States, France, the UK, Indonesia, and other countries in the archipelago to the north of Australia, as well as in the Indian Ocean and in the Pacific Ocean. So, that's not an unusual course for Australia to follow. What we're talking about, of course, is an expansion of that military engagement with the southwest Pacific and we're talking about a specific large hulled vessel whose primary purpose would be humanitarian and disaster relief; and I don't think any country would have any difficulty with that. We've also announced, of course, the extension of the naval base at Manus Island into a joint PNG-Australian naval base; the building of the Blackrock, a police and peacekeeping facility in Fiji. So we take an ongoing interest in the southwest Pacific, as you’d expect us to do as the largest economic power in the region and the largest military power, and we work closely with all of our Pacific neighbours, who regard us as family, and we regard them as family.

DAVID SPEERS: And just on the redevelopment of the Manus Island naval base there in PNG that you've referred to – what is that going to cost Australia?

CHRISTOPHER PYNE: I don't know if the cost has been revealed yet, David, so-

DAVID SPEERS: [Interrupts] You can do it right now.

CHRISTOPHER PYNE: [Laughs] I think I should take advice on when that will be revealed. I don't believe in the Prime Minister's speech last Thursday that that was revealed. I’m sure it will be revealed that-

DAVID SPEERS: [Talks over] No, it wasn’t. I was hoping you might be able to let that slip for us but-

CHRISTOPHER PYNE: Look, it's a substantial investment and I think the Australian taxpayer would be perfectly comfortable with the investment.

DAVID SPEERS: [Talks over] Well, will you have ships permanently based there, Australian ships?

CHRISTOPHER PYNE: That is the likely ongoing role of the new base at Manus Island or the expanded base at Lombrum in Manus Island. There would be-

DAVID SPEERS: [Interrupts] Which we’ve not had before, is that correct? We'd have Australian ships permanently based there for the first time?

CHRISTOPHER PYNE: We could well have Australian naval vessels based there permanently or temporarily, working with the PNG Defence Force, and we could see that base expanded into the future. But we're at the beginning of that process, working closely with the PNG Defence Force, and of course, the PNG Government – they’ve invited us-

DAVID SPEERS: [Interrupts] Why would we need permanently-based warships in PNG for the first time?

CHRISTOPHER PYNE: Well, PNG has invited us to build and extend their base at Lombrum. We've accepted that invitation. We'll work closely with them. Whether we have permanent naval platforms based there is something that we'll continue to discuss with the PNG. Manus Island-

DAVID SPEERS: [Interrupts] But is that something Australia wants? Is it something Australia wants?

CHRISTOPHER PYNE: Manus Island is a strategically important place on the globe. If you look at the map, obviously Manus Island is a very important strategic island for the southwest Pacific.

DAVID SPEERS: [Talks over] That’s why we’d want to be- that’s why we'd want ships based there?

CHRISTOPHER PYNE: Well, we, working with the PNG Defence Force, want to ensure the security and safety of the southwest Pacific. We want to assist our 22 neighbours with issues around people smuggling, environmental vandalism, illegal fishing, and of course, their military security and of course, Manus Island is a good place from which to do that.

DAVID SPEERS: Can I turn to the argument around Australia's embassy in Israel? Do you think it should be in Jerusalem?

CHRISTOPHER PYNE: Well, the Prime Minister’s announced a process, David, and we're going through that process. What's important is that Australia makes its own decisions about our foreign policy priorities. Listening this morning to Penny Wong, it was very clear that Labor wants to subcontract our foreign policy to overseas governments, just as they subcontracted our border protection to people smugglers last time they were in power and they've subcontracted economic policy to the Coalition in the last five years.

DAVID SPEERS: [Talks over] Okay. Labor’s not the one that have raised this prospect. Can I go to a previous suggestion you've made? You've said: I believe we should consider whether it would assist to create a two-state solution in Israel and Palestine for that to be an Australian embassy in west Jerusalem and a Palestinian state with its capital in East Jerusalem; and our embassy therefore in their state in East Jerusalem. So, do you still hold that idea? Have two embassies – one in West and one in East Jerusalem?

CHRISTOPHER PYNE: Well, we have a very sensible process in place. I believe in the two-state solution – that's the Government's policy. I believe it's the Labor Party's policy. If we moved our embassy from Tel Aviv to West Jerusalem after this process has been completed, if that's the recommendation, it would be in the capital of Israel which is Jerusalem. In the event that there is a second state in Palestine, in the West Bank and Gaza, their capital would be likely to be East Jerusalem, as it has been in the past, and you would expect that Australia would then open an embassy in East Jerusalem in the state of Palestine. So that is- if one follows the other, in the event of there being a second state in that region, which is the Government's policy, that's what we support.

DAVID SPEERS: So, we could have an embassy in Jerusalem as well- well, West Jerusalem for Israel, one in East Jerusalem for Palestine, or at least signal that's our intention to do that. Has this been communicated at all with the Indonesians as far as you're aware?

CHRISTOPHER PYNE: Look, I don't know about that. I haven't engaged with the Indonesians on this subject. All I can tell you is that I have been in Singapore and in Bali, meeting my counterpart, the Minister for Defence, on I think three occasions – once in Singapore but I saw him several times; once in Bali for an official meeting. Nobody from the Indonesian Government, from the Minister for Defence down, has raised this issue with me.

DAVID SPEERS: [Talks over] Fair enough. But this idea that you've suggested could be an eloquent solution to this issue, do you think?

CHRISTOPHER PYNE: Well, that's a matter for the process we’re going through. What I've outlined is what I understand the announcement that we made several months ago to be.

DAVID SPEERS: To have an embassy in West Jerusalem with an intention for a separate one in East Jerusalem?

CHRISTOPHER PYNE: That's as I understand it, yes.

DAVID SPEERS: And you support that?

CHRISTOPHER PYNE: Yes.

DAVID SPEERS: Alright.

CHRISTOPHER PYNE: But we'll see what the process- where the process leads us in terms of moving from Tel Aviv to Jerusalem, but in the event that we did establish an embassy in West Jerusalem and move from Tel Aviv, and in the event there was a second state, I would envisage that there'd be an embassy in East Jerusalem for the Palestinian state. That's what I understand the policy to be if the process leads us to that outcome that the Prime Minister has put in place.

DAVID SPEERS: Defence Minister Christopher Pyne, I've taken up more of your time than I'd intended. I appreciate-

CHRISTOPHER PYNE: [Interrupts] Nah, it’s always a pleasure.

DAVID SPEERS: I appreciate it. Thank you very much. We’ll talk soon.

CHRISTOPHER PYNE: Thank you.