Australia should appoint a Czar to boost our defence industry capability, experts say, with a new report warning that it currently does not "reflect the demands of a world where Australia needs to be prepared for major conflict in our region".
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The report from national employer association Ai Group and the Australian National University, released today, argues that we need to view a locally-based defence industry as a capability in its own right, and not just something that supports individual Australian Defence Force Programs.
Report co-author and ANU's Professor Stephan Fruehling said a consequence of this shift in thinking is seeing how we can build long-term strategic partnerships that can be used to scale defence capability - something that can't happen when defence industry is only "considered in relation to each specific acquisition program".
"It's like if we buy trucks, and we buy medium trucks, and then we might find some light trucks, and a few years later buy heavy trucks. At the moment we would look at those as stove-piped single programs and we might consider the industry to sustain that program," Prof. Fruehling said.
"Whereas if you say 'look, we want to build a truck industry that allows us to grow', we might say let's actually choose a strategic partner so that we... can pool those programs to build an industry that can achieve scale that we couldn't achieve if we always advertised everything and competed everything in its own right".
'We really need a defence industry that, to put it directly, is war ready," report co-author and Ai Group research and economics director, Dr Jeffrey Wilson, told The Canberra Times.
These calls follow the government's scathing Defence Strategic Review released in April, which found that the ADF's current force structure was "not fit for purpose" and warned that Australia could not rely on having sufficient warning time for strategic thinking before a conflict.
The report from Ai Group and ANU also precedes the government's upcoming National Defence Strategy, due to be released in 2024.
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Ai Group Chief Executive, Innes Willox, said the main question that strategy should consider is "how to ensure we have the capability - in terms of infrastructure, skills and intellectual property - to supply critical defence goods in Australia".
"Both international primes and local businesses in defence and the defence supply chain are critical to achieving that ambition."
The report also says that Australia should identify how it can leverage civilian industry to support and rapidly scale defence industry during surge periods - similar to how some gin manufacturers pivoted to producing hand sanitiser in the pandemic.
A key problem is the lack of coordination across government and industry - something that the report recommends solving with the creation of a Defence Industry Capability Manager, or a "defence industry Czar" as Mr Willox called it.
This would be a public servant tasked with identifying how Australia should develop and leverage industry to meet the demands of regional conflict, and working across government and industry to achieve this.
"In the history of military procurement ... [whenever] anything goes wrong the answer is there wasn't enough coordination between the left hand and the right hand and the various feet," Dr Wilson said.
"So what we say is that you need someone ... who can walk across different worlds. Who has experience in industry, can work across government ..."
Justine Landis-Hanley
I'm a federal politics and public sector reporter at The Canberra Times, with an interest in integrity, regulation, and social services. Contact me with tips and feedback at justine.landishanley@canberratimes.com.au.
I'm a federal politics and public sector reporter at The Canberra Times, with an interest in integrity, regulation, and social services. Contact me with tips and feedback at justine.landishanley@canberratimes.com.au.
