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Friday, March 12, 2010

In too deep: Defence anchored by cost of new subs


As Australia prepares to commit to its most expensive defence project yet, military chiefs are being warned not to get out of their depth when buying new submarines.

Defence recently acknowledged that only two of Australia's six Collins-class submarines are seaworthy. (File photo) (Australian Navy)


Defence officials will be burning the midnight oil at their Canberra headquarters in the coming months, hatching plans for an all-out assault on the nation's purse strings.

Their mission will be to persuade their political masters that billions of taxpayer dollars should be committed towards building their preferred replacement for Australia's troublesome and costly Collins-class submarines.

Later this year, the Defence Force will give the Federal Government its wish list for the new submarines, detailing the features and capabilities it wants in the boats. It is expected to be the most expensive defence spending project in the nation's history.

"You can be absolutely sure that what they're cooking up is a very big, very complex, very sophisticated, very expensive and very risky submarine," says Professor Hugh White, head of the Strategic and Defence Studies Centre at the Australian National University and a Visiting Fellow at the Lowy Institute for International Policy.

Another leading defence analyst, Andrew Davies from the Australian Strategic Policy Institute, says he is also worried.

"There are certainly a lot of things to worry about when planning a future submarine project because you'd have to say at the moment the Collins fleet is in a shambolic state," he said.

In an embarrassing admission, Defence recently acknowledged that only two of Australia's six Collins-class submarines are seaworthy.

Of the others, one needs repairs to a diesel motor and another requires repairs to one of its electric generators. Two more will be out of service for long-term maintenance for at least four years - a significant chunk of the submarines' projected operational life span.

Defence wants to replace the Collins boats by 2025.

"We've seen with Collins that developing your own submarine is a pretty fraught activity," Dr Davies said.

"You'd have to say the results, as we stand here today, are disappointing."


 
Defence Minister John Faulkner admits there have been frustrations.

The problems have prompted the Federal Opposition to question whether or not Australia is capable of developing a bigger, more complex submarine without also increasing the potential for things to go wrong.

"It is critically important that we learn the many lessons from the Collins program," Senator Faulkner told a Senate Estimates Committee hearing recently.

"I have said to Defence this is a fundamental threshold requirement."

'Masters of our destiny'

Estimates of the cost of new submarines vary wildly. The Government has indicated it wants another non-nuclear conventional sub and it wants it built, and creating local jobs, at Adelaide's naval dockyards.

The likely price tag would begin at a modest $9 billion for submarines built to an off-the-shelf design. The figure rises towards $40 billion for a model fully customised for Australian conditions, and strategic ambitions.

"A bit of nay-saying needs to be put to one side because we're able to do it," said Peter Horobin, a former Navy submarine commander and now president of the strategic lobby group, the Submarine Institute of Australia.

He argues the more local involvement in the new submarines, the better.

"My point of view is that we have to have clear, focussed Australian ownership of the program.

"We need to be masters of our own destiny. If we're purchasing an off-the-shelf submarine, we're forever going to be going back to whoever that person was who made it to find out whether we can fix it or change it. We become dependent on an external party.

"Submarines are so fundamental to our defence strategy that we have to do it ourselves. It's part of growing up."

Think again

Others warn that the Defence Force usually finds itself in deep water when it backs ambitious projects.

"The more we fiddle with things, the more uniqueness we seek in our solutions, the more likely they are to be late and more likely they are to cost more than we expected," Dr Davies said.

"So off-the-shelf is certainly the way to go if what you're looking for is capability that can be delivered on time and on budget.

"If you can get an 80 per cent solution off-the-shelf, often that's better than aiming for a 100-per-cent solution that you have to wait years and expend a lot of dollars to get and end up disappointed with."

Few believe, however, that Defence will opt for a pared-down solution.

"They want a submarine that can do everything," Professor White said.

"The reason they want that is because they're not quite sure what they want a submarine to do.

"If you're not sure what it's meant to be doing, there's a lot of temptation to go out and buy one that can do everything.

"That drives up risk. It drives up cost. It drives down the numbers you can afford."

Source abc.net.au