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Thread: Australia's Defence Capability Plan

  1. #1

    Australia's Defence Capability Plan

    Defence Capability Plan 2009-Update

    (Source: Australian Department of Defence; issued Feb. 26, 2010)

    Greg Combet, Minister for Defence Personnel, Materiel and Science, today launched the electronic update of the 2009 Public Defence Capability Plan (DCP).

    Mr Combet said as foreshadowed last year the Government intends to update the public version of the Defence Capability Plan about every six months.

    “The first update of the Public Defence Capability Plan 2009, which lists major capital equipment proposals that are currently planned for Government consideration over the next few years, is now available on Defence websites,” Mr Combet said.

    “Changes made to the Public Defence Capability Plan 2009 are the result of decisions taken by Government since July 2009, up to 31 December 2009.”

    Mr Combet said the updated Public Defence Capability Plan 2009 contains significant opportunities for Australian industry.

    “Last financial year we expended around $6 billion on acquisition and sustainment in the domestic economy. Between 2009/10 and 2013/14, the DMO predicts that approximately $30 billion will be spent in the domestic economy,” Mr. Combet said.

    “A key addition to this update is the project summary page that shows all the project changes that have been made since the original publication of the Defence Capability Plan in July 2009, up to 31 December 2009.

    “The DCP will continue to be adjusted over time due to various factors that emerge as the capability development process progresses, including: changing strategic priorities and economic circumstances, the maturity of projects and the evolution of technology in the options under consideration, and operational experience.”

    Click here for the revised Defence Capability Plan (HTML format) on the DMO website.



  2. #2

    War on waste: 'Defence extravagance must end'


    March 10, 2010

    Beat up or truth????

    THE Defence Minister, John Faulkner, has demanded action on millions of dollars Defence has spent on luxury items, saying ''financial control is critical''.

    Use interactive tool to search Defence contracts database

    His comments follow a Herald investigation which revealed oil paintings, handmade Chesterfield lounges and exclusive golf and fitness club memberships are among $48 billion of contracts reported by the department since 2006.

    ''If you need more evidence of why the [government's] strategic reform program is required, then you have provided it,'' Senator Faulkner told the Herald.

    The reform program, launched last year, will demand $20 billion worth of savings over 10 years.

    His comments came as a former army chief said Australia should consider cutting its defence budget - now $27 billion - and redirecting money towards diplomacy and aid.

    Peter Leahy, who retired as a lieutenant-general in 2008, also questioned the government's commitment to huge military equipment projects, suggesting the acquisitions might turn out to be expensive white elephants.

    Discussing the revelations yesterday, Senator Faulkner said: ''There are issues about the culture in the organisation. Obviously those sort of things are not to be sneezed at.''

    Senator Faulkner told Parliament yesterday he had asked the Secretary of the Defence Department, Ian Watt, to review the contracts published by the Herald to make sure they fell inside the reform program and ''to ensure Defence has adequate reporting procedures to give senior management the information and the opportunity to intervene''.

    ''Financial control is critical. All of these issues, if not dealt with already, should be and will be examined,'' he said.

    Senator Faulkner said the reform program had already found $176 million in non-equipment spending that was being wasted. This included $64 million in travel costs alone.

    He said some of the contracts published by the Herald had been identified as legitimate, such as the hire of a Learjet which was ''in support of combat equipment testing''. His department had previously failed to explain the expense.

    The reform program is needed, according to a top-level audit in 2008, so the military can afford to expand, purchase future technology and properly defend against the uncertain strategic environment ahead.

    Professor Leahy told the Herald a new national security environment, characterised by low-level conflicts, terrorism, policing and reconstruction work, might tilt the funding balance towards the Department of Foreign Affairs and Trade, the Australian Federal Police and the government aid organisation, AusAID.

    Professor Leahy, who is the head of the National Security Institute at the University of Canberra, said this would be particularly so if the aggregate budget for the ''national security community'' did not increase.

    Professor Leahy said the federal police's workload had rapidly increased but its budget, while growing, had not kept track. He also pointed to a report by the Lowy Institute last year that found DFAT, which has a budget of $5.29 billion, was run down and poorly equipped to deal with looming threats that include global warming, terrorism and regional power shifts.

    The report argues that Australia needs robust defence, intelligence and law enforcement capabilities but says diplomacy is the most effective way to influence other nations.

    Professor Leahy said the question of funding balance was already being debated in the US, where the Defence Secretary, Robert Gates, and the chairman of the Joint Chiefs of Staff, Admiral Mike Mullen, have said more money needs to go to the State Department and USAID - the American equivalents of DFAT and AusAID.

    Despite the changing strategic environment, the present and previous federal governments have committed to buying tens of billions of dollars worth of big-ticket items, including 100 F-35 Joint Strike Fighters, 12 new submarines and three air-warfare destroyers.

    Professor Leahy said the wisdom of equipping the Australian Defence Force for a war it was unlikely to fight could be questioned, and it was possible the government might back away from these acquisitions.

    ''We need to have a very close look at the most effective tools to use in this new security environment,'' he said.

  3. #3

    From an "end-user" perspective, the article and Leahys comments are absolute BS. Its as if the last decade never happened and we're still in the 90's talking about the "Revolution in Military Affairs". Clearly we'll never use big, nasty things like tanks or combat aircraft ever again because Leahy's Magic Eightball says "Future certain, no more war".

    Its disturbing when supposedly logical people can claim basic military equipment like warships or jet fighters are "big ticket items" we don't need. With that thinking anything more advanced then .303 Lee-Enfields aren't needed. Hell, we can save a fortune scrapping all the navy's SM2s & ESSMs cause guns seemed to work well enough for the RAN in the last war.

    As for the rest of the article, sure we can stop sporting comps because fitness is now unimportant in these new "push-button" wars that obviously don't require any physical effort. And visiting dignitaries can sit on empty milk crates because we are clearly too poor to afford decent couches.

    I long for the day when the rod jammed up people's @$$es is removed and the idea that
    A) Defence costs money
    B) As a first world nation we can afford it
    take hold and this fake BS outrage that surfaces every few months goes away, though not holding my breath.

    End of Rant.

  4. #4

    Being cynical as I am, and as life has led me to be, my thoughts on all of this led me to the conclusion this is a beat-up to "excuse" the reduction or cancellation of one or more major programmes under the reasoning those "nasty" people in DoD and the Forces are wasting money so take it away from them.............typical International Labour/Labor governement SPIN aka BS, sheer unadulterated BS...........

  5. #5

    $100 says they won’t? Any takers… 2-1, 3-1?

    You have two unrelated events:

    SMH trolls through all the online contracts and finds a lot of dirt. But nothing big or DCP related. All just lots of stupid stuff that no doubt every other Govt. department is doing as well as defence.

    Lt.Gen. Leahy (ret.) shoots a broadside at the huge expenditure on submarines, fighters, etc while his diggers on actual combat operations continue to go without new AFVs and other more basic equipment or are required to carry out constabulary missions in the South Pacific. No different to similar rumblings in the UK and USA.

    None of this is initiated by the Government which has no dire urge or need to make high level savings at the expense of defence (ie cancelling a major project). If the Government had its way it would be happy to replace all that expenditure on sailor, solider, airman salaries with building new equipment because it makes for great little ribbon cutting and beholden voters in the suburbs.

  6. #6

    I don't smoke, drink or gamble.............

    [These emoticons are SHYTE!]



  7. #7

    Shame... could have done with some of your petrodollars!

  8. #8

    With federal elections looming there will be no major projects cancelled, besides the 12 submarines are a long way off ,AWD & LHD would cost too many votes if cancelled due to Australian participation in the projects & so on.The PM cant go back on recent announcements at this time in the electoral cycle & I doubt that he wants to either considering recent media views he cant afford to be seen as all waffle.
    General Leahy retd. is probably right when he says that the ADF is equiping for a war they are unlikely to fight. I think he has lost the plot, having this equipment will provide us with a credible deterrent against anyone wishing to put nasty thoughts into action where we are concerned.

  9. #9

    Procurement of Explosive Ordnance for the Australian Defence Force

    (Source: Australian National Audit Office; issued March 10, 2010)

    --Report Number: 24
    --Year: 2009/2010
    --Tabled: Wednesday, 10 March 2010
    --Portfolio: Defence
    --Agency: Department of Defence, Defence Materiel Organisation

    The objective of this audit was to examine the effectiveness of Defence and the DMO’s management of procurement and through life support arrangements to meet the explosive ordnance requirements of the ADF, particularly the non-guided munitions requirements of Army.

    This included a review of the progress of Defence and the DMO in implementing the recommendations of ANAO Audit Report No.40 2005–06.

    Click here for the full report (200 pages in PDF format) on the ANAO website.



    ANAO Audit on Procurement of Explosive Ordnance

    (Source: Australian Department of Defence; issued March 10, 2010)

    Defence today welcomed the Australian National Audit Office (ANAO) report on explosive ordnance procurement and agrees with the two recommendations.

    The ANAO recommended that:
    -- Defence and the Defence Materiel Organisation (DMO) develop processes for consolidating explosive ordnance inventory requirements of all stakeholders, at an appropriate level, to facilitate efforts to optimise explosive ordnance inventory holdings from both a capability and value for money perspective; and
    -- Defence undertake a strategic review of domestic manufacturing arrangements to evaluate the extent that value for money can be achieved from existing arrangements; and determine the ongoing viability of investment in domestic manufacturing capabilities.

    Vice Chief of the Defence Force Lieutenant General David Hurley said, “The matters raised in this ANAO report have not affected the quality or availability of explosive ordnance provided to the ADF on operations overseas. Defence remains committed to providing our service men and women with the highest quality equipment to enable them to do their jobs.”

    “The ANAO has acknowledged that Defence was already aware of a range of issues associated with procurement of explosive ordnance and has already established a number of reform programs to address these issues,” he said.

    In early 2008, the Vice Chief of the Defence Force was appointed as the single point of accountability for explosive ordnance in Defence. A dedicated branch was also set up to implement widespread reform of explosive ordnance.

    Additionally, the DMO established a dedicated division to manage explosive ordnance procurement. This division is progressing a complementary program of commercial and inventory management reforms and staff professionalisation.

    The Defence Explosive Ordnance Committee is directing a review to better coordinate all explosive ordnance requirements. This will inform development of the 2010-11 financial year explosive ordnance procurement plan.

    The DMO will not extend the current domestic contracts with Thales Australia Limited for the manufacture of explosive ordnance.

    The DMO is actively pursuing opportunities to achieve best value for money from the current contracts until they expire in 2015.

    Defence will assess the ongoing strategic importance of domestic munitions manufacturing and the viability of investment in these capabilities. The DMO is also investigating opportunities for future domestic manufacture of explosive ordnance which will meet Defence requirements in a cost effective manner.

    “These actions accord with domestic manufacture of explosive ordnance as a priority industry capability,” said Lieutenant General Hurley.

    While the report identified an apparently high level of “Other Than Serviceable” stock, these included such things as newly manufactured stock awaiting receipt inspection, stock returned to depots from combat units for re-use, and stock awaiting a “shelf-life extension” engineering decision. Stock classified “Other Than Serviceable” does not affect support to ADF operations.


  10. #10

    Cost-Consciousness in Defence

    (Source: Australian Department of Defence; issued March 18, 2010)

    Over the last week the Sydney Morning Herald has published a series of articles that have questioned the legitimacy and appropriateness of a number of Defence contracts and other expenditures. It also painted a picture of Defence being a profligate organisation.

    By way of background, on 27 February 2010, a Sydney Morning Herald journalist made an initial inquiry to Defence seeking answers to 55 questions that addressed contracts and expenditure across all Groups and Services going back several years. Many of the issues raised were wide-ranging and required detailed answers. Defence has provided responses to all of the questions put by the journalist, which can be viewed on the Defence Home Page.

    While we are satisfied that, with relatively few exceptions, the expenditures covered by the Sydney Morning Herald’s questions are both legitimate and reasonable, a number of the matters raised reflect unfavourably on particular decisions taken by delegates, and affect Defence’s reputation more broadly.

    We believe that Defence has a real opportunity to learn lessons from this exercise and to emerge as a stronger organisation as a result. And we will do so. To do so we need to do more to instil a culture of greater cost-consciousness across Defence. And we need to do more to assure the robustness of our spending and procurement processes.

    The Government will soon consider the implementation plan for the Strategic Reform Program (SRP). The plan has been under development since May 2009 and will provide a very detailed blue-print for deep reform in Defence, including the delivery of $20 billion in savings over the next decade which will be reinvested in Defence capability that is essential to deliver Force 2030.

    We expect to be in a position in the near future where we can brief all Defence staff in detail about the SRP.

    At the heart of the SRP is the imperative for all of us in Defence to conduct our business more effectively and more efficiently. This starts with decisions that individuals take each day, including on the expenditure of Australian taxpayers funds provided as part of the Defence budget. The Minister for Defence, Senator Faulkner, has been very clear about the need for Defence to use its resources more efficiently, effectively and most importantly, intelligently. A culture of discipline and cost-consciousness must underpin our everyday operations and decision-making. This is integral to responding to criticisms of our spending decisions. It will also be integral to the success of the SRP.

    We ask all managers, commanders and those exercising delegations to approach their business with these imperatives of discipline and cost-consciousness in mind. We must all recognise and take seriously our accountability for the effective and efficient use of Defence resources. Before we commit to expend funds we should ask ourselves some simple questions. Is this necessary? Is it value for money? Can we do better? Is it publicly defensible? We ask delegates and managers to pay particular attention to justifying and documenting their decisions. Moreover, if your procurement decision will be lodged on the AusTender database make sure that the description of the goods or services is complete and clear, ensure that the figures are accurate, and ensure that you maintain comprehensive and easily accessible records that can be made available for future review if required.

    As a final comment, most of the areas of expenditure that have been covered by the Sydney Morning Herald articles will be the subject of further scrutiny as part of the SRP. Any not covered will now be subject to scrutiny in other ways.

    While uncomfortable in parts, the Sydney Morning Herald articles are a timely reminder for us all of the need to reflect carefully on the decisions we take in our day to day activities as we work to reform Defence. We have no doubt that we will all learn from our recent experience. We will provide further guidance as we move into the implementation phase of the SRP.

    The Minister for Defence strongly supports the publication of all the responses as another way of enhancing transparency and accountability and encouraging greater cost-consciousness in Defence. So do we.

    Signed by

    -- I.J. Watt
    Secretary, Department of Defence

    -- A.G. Houston
    Air Chief Marshal
    Chief of the Defence Force


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