*** CHECK AGAINST DELIVERY ***
I begin by acknowledging the traditional owners of the Hunter Valley, the Wonnarua Nation, and I pay my respects to their Elders, past, present and emerging.
As the Minister for Defence Industry and Capability Delivery, I also pay my respects to Aboriginal and Torres Strait Islander men and women who have served our nation in the past and continue to do so today.
Our host, Chair of Hunter Defence, Tim Owen;
Former Defence Minister and former Member for Hunter, the Honourable Joel Fitzgibbon;
Lord Mayor of Newcastle, Nuatali Nelmes;
Defence Industry leaders;
Ladies and Gentlemen, Friends All;
It is always great to be in the mighty Hunter Valley…
I’d like to thank Hunter Defence for inviting me back to join you for this Conference.
As I was preparing for tonight, going through the Hunter Defence website as I reflected on a year of growth and progress in the local industry, I was stopped in my tracks by the heading: “Why the Hunter?”
Surely a more accurate heading would be “Why not the Hunter?”, when you look at the advantages enjoyed by Defence industry in our region.
The Hunter Valley is an economic powerhouse.
Host to a growing register of dynamic small to medium enterprises ….
With a proven track-record in the delivery of mission-critical components and services to the Australian Defence Force.
Connected to the nation through the east-coast transport corridor, and connected to the world by the Port of Newcastle.
With a world-class university, a skilled and adaptable workforce and an amazing lifestyle, the Hunter Valley’s future is brighter than ever before.
Especially for those in the Defence industry.
The Government has now put in place the foundations for a stronger defence force that is fully-fit to respond to the challenges of a much less certain world.
The first National Defence Strategy is our plan to deliver the significant and urgent changes required to address Australia’s challenging strategic circumstances.
Together with the rebuilt Integrated Investment Program, and the Defence Industry Development Strategy, we now have the blueprint to transform the ADF into the integrated, focused force we need in order to safeguard Australia’s security for decades to come.
Most importantly, we have the resources we need to give effect to these plans.
This year’s Budget increased Defence funding to $764.6 billion over the decade.
We’ve allocated $330 billion over the 10 years to 2033-34 for the rebuilt Integrated Investment Program.
That’s a significant lift compared to the $270 billion allocated as part of the 2020 Defence Strategic Update and 2020 Force Structure Plan.
As a result of the Government’s commitments, the annual Defence budget will almost double over the decade, growing to an estimated $100 billion dollars by 2033-34, compared to $56 billion dollars this financial year.
As important as what we spend, is how we spend it.
We are investing in the capabilities that matter the most and driving the process to get them into the hands of our warfighters as soon as possible.
In doing so we are working to actively create opportunities for Australian industry, through the entire supply chain of small-and-medium sized enterprises, as outlined in the National Defence Strategy.
In total over 21,200 contracts were awarded over the 2023-24 financial year, which represents 12.6% growth on the previous financial year.
And this does not capture the billions of dollars more in contracts from Primes to Australian SMEs, which are mandated and carefully monitored by the Australian government.
The Defence Industry Development Strategy is the Government’s roadmap to deliver a stronger defence industrial base that is more resilient and better able to meet the needs of the ADF at the pace we need it.
The Strategy is designed to enhance the Defence-industry partnership by making Defence a better customer and focusing both Defence and industry on the most important priorities…
… with a hard focus on creating the sovereign defence industrial base Australia needs.
What does success look like?
Success means Defence can access the industrial capabilities it needs within the resources available.
The industrial capabilities must be able to scale rapidly in times of need.
And the industrial base must be capable of creating and integrating innovative capabilities at speed.
As much as we might like to invest in everything, we can’t.
Our strategic circumstances demand that we invest in seven Sovereign Defence Industrial Priorities (SDIPs).
These are the industrial capabilities that Defence requires in Australia.
They are the industrial capabilities that may require Defence to intervene to make sure they are available in Australia.
It’s not enough just to identify priorities and hope that fortune smiles on those who undertake them.
We’re embedding the Sovereign Defence Industrial Priorities into the Defence Capability System.
They have their own capability managers and delivery managers who are accountable for them, whose job is to ensure their health and growth in Australia.
And Defence’s job is to assist industry to grow and adapt to Defence priorities.
The DIDS represents a whole of government and whole-of-nation approach to developing the sovereign defence industrial base in priority areas.
A lot of our sovereign defence industrial base already exists – and a lot of it exists in the Hunter.
One area I want to focus on this evening is the maintenance, repair, overhaul and upgrade of ADF aircraft, because it is one of the seven Sovereign Defence Industrial Priorities and because it employs so many workers in our community.
Hunter is home to an outstanding group of businesses ranging from the largest Primes to their smallest local suppliers which support critical capabilities including the E-7 Wedgetail, the Hawk 127 Lead-in Fighter and the F-35 Joint Strike Fighter.
The Government secured the future of the Hunter Valley as the Indo-Pacific hub for sustainment of the JSF when we announced in December last year that we would double our initial investment with BAE Systems Australia.
The funding boost will enable BAE to build seven more maintenance bays – increasing overall capacity to 13 bays - to help service the growing F-35 fleet in the Indo-Pacific.
This means Newcastle Airport will be equipped not only to service Australia’s JSF fleet, it have the potential to be used by other nations to sustain and service a global F-35 fleet that’s expected to reach more than 3,000 aircraft.
This is the Government putting in place all the preconditions for the industry’s growth – and that’s great news for the future of our region.
While the Hunter region is rightly proud of the deep expertise of the local aerospace industry, it is far from the only defence industry to be found here.
Many of you will have seen that the Royal Australian Navy achieved a major milestone last month with the successful firing of the Naval Strike Missile, the replacement for the ageing Harpoon weapon system, at Exercise RIMPAC.
The Naval Strike Missile is a terrific example of Defence’s collaboration with industry, Norway and our broader international partners.
This major achievement would not have been possible without the forward-leaning and pragmatic mindset of Norway, Kongsberg Defence Australia and its Norwegian parent company Kongsberg Defence & Aerospace.
Cardiff company Nupress is already partnering with Kongsberg to manufacture mechanical components for the Naval Strike Missile, with deliveries to commence next year.
Nupress will join a talented community of Australian companies already contributing to the Naval Strike Missile capability.
The introduction of Naval Strike Missile delivers on our promise to increase the capability and lethality of our Navy.
But we can go further to realise the full potential of Australia’s industrial capabilities, and our partnerships with Kongsberg and Norway.
Today, I announced that the Albanese Government will contribute up to $850 million in partnership with Kongsberg Defence Australia to manufacture and service missiles at Williamtown.
This project, which involves the construction of a factory in the Newcastle Airport precinct, is expected to generate more than 500 jobs in the construction phase and almost $100 million in economic benefits to the local area.
Once complete, the factory is expected to employ approximately 100 people.
It means the workers of the Hunter will support the building and maintaining of missiles for the ADF.
The factory will manufacture and service Naval Strike Missiles and Joint Strike Missiles to be used by the ADF.
Once complete, it will be one of only two facilities in the world capable of producing NSM and JSM.
Doing this here in Australia boosts our economic and industrial resilience, and makes our nation more secure.
Supporting our warfighters, giving them the best possible kit to protect them as they protect us, will always be this Government’s priority.
Last year, we provided a grant of almost half a million dollars to Frontline Safety Australia in Newcastle for a lens-cutting machine to produce ballistic protective eyewear.They produced the first batch of protective eyewear in March this year.
They’ll be able to fully manufacture 100% of their protective eyewear components in Australia before the end of year.
This is what we mean by a future that is made in Australia.
It’s a future that delivers good jobs and delivers real outcomes that make the ADF stronger and the country more resilient.
A foundational element of Defence’s Integrated Air and Missile Defence capability is the Joint Air Battle Management System.
The Defence Strategic Review made it clear that an enhanced, all-domain integrated air and missile defence capability is critical in the face of Australia’s evolving strategic circumstances.
Lockheed Martin Australia has been selected as the Strategic Partner for this project and will collaborate with other Australian defence industry partners.
The project will generate up to 230 jobs, including for subcontractors, in high-tech areas including software development, systems engineering, project management and logistics. Around 60 of those jobs will be here in the Hunter region.
And it will provide opportunities for Australian industry to benefit from a global $83 billion export market, underscoring the Government’s support for growing Australia’s sovereign defence industry.
Exports are vital to growing the resilience of the Australian defence industrial base.
And the Albanese Government is turbo charging these export opportunities through a significant expansion of the Global Supply Chain (GSC) Program.
The number of Primes participating in the Program has almost doubled, from seven to thirteen.
This is an investment in our national security and an investment in a future made in Australia.
Since its inception, the Global Supply Chain Program has delivered over $1.94 billion dollars of contracts to more than 260 Australian suppliers.
The expansion that I announced last month will put a rocket under those numbers, backing local businesses, creating hundreds of jobs nationwide and supporting many more.
And it delivers on a commitment made in the Defence Industry Development Strategy – the DIDS.
The Government designed the DIDS to drive change.
We designed it to make Defence and industry accountable, to provide certainty to industry and build defence exports because that is essential to helping build the depth and expertise of the sovereign defence industrial base.
We are working our way through all the commitments we pledged in the Strategy to help speed up those outcomes.
A future made in Australia is produced by investing in industry’s capacity.
One of my first priorities was to overhaul the Defence Industry grants structure to make it simpler and more streamlined.
The new Defence Industry Development Grant program is open for applications, with over $150 million over four years dedicated to supporting small to medium-sized business in areas of sovereign industrial priorities, exports, skilling and security.
And I’m pleased to tell you that the first applications have been received and are already being assessed.
My focus is also on building the pathways for local businesses to succeed in our biggest procurements.
Through AUKUS, the Nuclear-Powered Submarine Program will become one of the most transformative industrial projects ever to be undertaken in this country.
And we have built in opportunities for businesses from across Australia to make a contribution.
The Australian Submarine Agency’s Industry Portal is open for businesses from every state and territory to register their interest.
And a huge amount of work is underway behind the scenes with our AUKUS partners to develop vendor and product qualification processes to enable Australian industry to participate in US and UK industrial bases.
Artificial intelligence and autonomy is one of the priority areas under the second Pillar of AUKUS.
Right here in the Hunter, Van Munster Boats produces the Bluebottle uncrewed surface vessel as a principal supplier to Ocius.
Bluebottles use solar, wind, and wave energy to ensure persistent intelligence, surveillance and reconnaissance above and below the water. They are already being used across government by the Navy, the Australian Border Force, and Australian Maritime Parks.
Whether it’s the biggest projects like AUKUS, naval shipbuilding and sustainment, or small batch and specialist purchases, I know procurement reform is a top priority for industry.
Defence is working on this problem from a number of angles, reforming the procurement framework to support an increased risk appetite and making Defence more agile and better able to make smart decisions to deliver capability quickly.
We have already made some improvements to the ASDEFCON templates and there are more on the way.
We are also reshaping the Office of Defence Industry Support – ODIS - with a much sharper focus on delivering the Sovereign Defence Industrial Priorities.
ODIS is now in the business of finding, supporting and developing businesses who are working in priority areas and getting them integrated into supply chains - fast.
And ODIS will also look to supporting Australian businesses to move up the value chain, and actively seeking opportunities to embed them into global supply chains.
Since coming to government in 2022 we have provided strategic direction, appropriate funding and ministerial stability. We have set a strategy, funded it, and stuck to it. The results are starting to show.
When we came to Government, we had a legacy fleet with a maximum range weapon in the vicinity of 200 kilometres. By the end of this year, with the incorporation of the Tomahawk capability, Navy will have a maximum range weapon in excess of 2,500 kilometres.
We have also made the important decision to equip the RAAF with the Long Range Anti-Ship Missile, and we are investigating integration of the Joint Strike Missile with our international partners.
When we came to government, the furthest Army could send artillery rounds was 30 kms. The Army soon will be able to hit land targets more than 500 kms away, thanks to our decision to equip them with the HiMARS system.
Right across the Defence portfolio, we are providing the ADF with the capabilities that will give any potential advisory pause for thought. This is about protecting regional peace and security. And keeping Australians safe.
The work is only beginning.
We are currently replacing every 9mm pistol in the ADF. When we came to government, ADF members were still being issued Browning HI-powers based on a model patented in the 1920’s. The replacement pistol is a similar weapon to the pistol carried by US Army rangers.
I am particularly proud that next year we will start manufacturing precision guided munitions in Australia. We will start small – building our capacity deliberately.
And over the coming years we will increase our industrial scale so we can build conventionally armed, nuclear powered submarines. This task will not be easy. It will require having a strategy, funding it and sticking to it.
But we are up to the task.
This is now the third time it has been my privilege to address the Hunter Defence Conference.
It’s not an honour I take for granted, just as I have the honour of being a voice for the Hunter around the Cabinet table in Canberra.
From Lone Pine Barracks at Singleton to RAAF Base Williamtown, this region is home to ADF personnel who protect and serve the nation.
And thousands of workers depend on the defence industry for their livelihoods.
We do face a challenging strategic environment.
It is more important than ever before that we hit the accelerator on getting the right military capabilities into the hands of our warfighters.
It is essential for deterrence.
And it is essential for our national security.
And it’s one of the reasons the Prime Minister has recently given me responsibility for capability delivery.
I will continue to be a passionate advocate for growing our local defence industry as part of a future made in Australia.
Thank you.