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Battle stations: The former PM, ministers, and military brass cashing in on Australia's defence spending bonanza

Sydney Morning Herald

10 hours ago

Sydney Morning Herald

Battle stations: The former PM, ministers, and military brass cashing in on Australia's defence spending bonanza

Early last year, United States technology company Anduril, co-founded by colourful American entrepreneur and Trump enthusiast Palmer Luckey, unveiled a coup in the highly competitive world of defence industry. The company announced it had hired the Royal Australian Navy's former head of naval capability, rear admiral Peter Quinn, to join its Australia and Asia Pacific team as vice-president of strategy, to 'accelerate' its regional business. It was a timely catch for Anduril. For five years, Quinn had occupied a high-level navy post in which his job was to identify the navy's future capability needs. He still held the post in May 2022, when the Defence Department handed Anduril a $77 million limited tender contract to develop a new capability for the fleet: the Ghost Shark. This was a daring design for an autonomous under-sea vehicle (AUV) – an uncrewed robot submarine – still then in prototype. Quinn, who had been one of the signatories on the original Ghost Shark agreement, left the navy at the end of 2022. He took a year's break – the minimum 'cooling off' period mandated by the navy – then joined Anduril in January 2024. In all, 13 months had elapsed between him leaving the navy and joining the ambitious American company. This raised some eyebrows, but there was even more widespread grumbling about the fact such a large project had not gone to open tender. 'That didn't pass the pub test,' complained one industry source, who said he took calls from annoyed potential competitors. Total combined investment in the project has climbed to more than $160 million, with three prototype Ghost Sharks delivered to the RAN and costs shared between the company and Defence through a fast-track process the government has dubbed the 'advanced strategic capabilities accelerator'. Quinn's hiring is far from unique. It fits within a decades-long tradition of senior ADF personnel, ministers and political staffers taking up posts with large defence companies or defence-related advisory and lobbying services after leaving public life or active service. As Australia's total defence spending climbs beyond $59 billion a year, and the AUKUS trilateral security pact looms large on the horizon, the phenomenon is set to intensify as firms jostle for an inside track. It extends to former politicians and political staffers on both sides of politics. Naturally, those who have served in Defence or shadow defence portfolios have been in hottest demand. The list includes former ministers Christopher Pyne, Kim Beazley, Arthur Sinodinos, Stephen Conroy, Joel Fitzgibbon, David Johnston, former Liberal opposition leader Brendan Nelson and former prime minister Scott Morrison. And the federal government's register of lobbyists shows dozens of former staffers who have joined advisory firms with defence clients. Among them are Paul Chamberlin, former staffer to three Nationals leaders; Carl Ungerer, a former national security adviser to one-time Labor leader Simon Crean; Michael Choueifate, a one-time chief of staff to Anthony Albanese; Adam Howard, the former chief of staff to Pyne; and Tony Hodges, a former staffer to then-shadow defence minister Richard Marles and former prime minister Julia Gillard. Anduril says it cleared Quinn's recruitment with the Defence Department and it was within RAN rules. Nor, the company insists, has Quinn had any involvement with the Ghost Shark or the company's maritime business since he joined its executive team. (Quinn did not respond directly to questions put to him through Anduril.) But Greens defence spokesperson David Shoebridge says the rules should change so there is a 'rock-solid prohibition on the decision-makers for multibillion-dollar tenders ever going to work for the companies that win the contracts'. Defence deflected questions about Quinn's role in the original Anduril contract but said 'movement of staff between Defence and Defence industry is important as we work together to train and retain the highly skilled and experienced workforce needed to deliver Australia's national security'. It added 'post-service employment of former ADF members is managed in line with Defence policy to mitigate any real or perceived conflicts of interest'. As one consultant sees it, 'the value to industry of these guys is that they can map a very complicated procurement process inside the Department of Defence and at a political level as well. If you're [an outsider] your understanding of the stakeholders is very low, and it's very difficult to get that understanding without hiring someone who has been in the system ... It's often a total lasagne of people whose names aren't available through Google.' This masthead does not suggest any improper conduct on the part of Anduril or Quinn, including that his involvement in the Ghost Shark agreement was influenced by the possibility of future employment with the company. Rather, broader questions remain about the stringency of rules around post-ADF employment. Former judge Anthony Whealy – chair of the Centre for Public Integrity, which has recently called for an overhaul of lobbying regulations – believes there should be a minimum three-year 'cooling-off period' before politicians, senior officials and senior ADF figures take up private employment in fields that related to their duties while in public life. (Currently ministers cannot lobby on matters they had official dealings with until 18 months after leaving office.) Shoebridge says 'unfortunately, the revolving door between Defence and arms companies is going strong'. Anduril's nimble manoeuvring in a sector bedevilled by chronic delay has some admirers, though. 'Anduril are the answer to a problem,' argues former US marine Gary Slater, now with the Australian Defence Consultancy Group. 'They move fast, they break things, they're cashed up with venture capital. They have truly cutting-edge technology that [jumps] from idea to design to prototype in months, not years.' Senior former ADF personnel are, in the meantime, liberally sprinkled throughout the private defence sector. A prominent example is former chief of the Defence Force Mark Binskin, who holds the post of executive director for defence and national security at BAE Systems Australia, an offshoot of the British company that has been hand-picked to help construct Australia's own nuclear-powered submarine fleet under the AUKUS pact. Former navy chief Tim Barrett is a non-executive director at BAE Systems Australia. Neither Binskin nor Barrett have any involvement with the AUKUS submarines, according to a BAE spokesman. Retired rear admiral Lee Goddard has become strategic adviser to Australian Missile Corporation, part of the Queensland-based Nioa armaments group, which has offices in Britain and the US and also has AUKUS ambitions. Former rear admiral Mark Purcell has been snapped up as a senior adviser by former treasurer Joe Hockey's lobbying firm, Bondi Partners, which is also active in the AUKUS space, while retired rear admiral Chris Ritchie, another ex-navy chief, has only just left the board of patrol boat manufacturer Luerssen following its merger with engineering firm Civmec. The chief executive of Lockheed Martin Australia and New Zealand is a former senior RAAF officer, Warren McDonald, who joined the company in 2021, a year after leaving his post as chief of joint capabilities inside the Defence Department. The lobbyists Canberra insiders say three lobbying firms dominate the defence space: TG Public Affairs, Pyne and Partners, and CMAX Advisory. Each have client lists extensively documented on the federal government's lobbyists register. TG Public Affairs, which represents 15 of the top 40 companies contracting to defence, boasts a heavyweight advisory board, chaired by former communications and shadow defence minister Conroy, sitting alongside former defence ministers Beazley, David Johnston and a former deputy secretary of the Defence Department Steve Grzeskowiak. Its clients include a number of the 'primes' (as the big contractors to defence are known) such as Lockheed Martin Australia, Saab, Northrop Grumman and Rheinmetall Defence. Former Liberal defence and defence industry minister Christopher Pyne's eponymous lobbying firm has established itself as another energetic player in the defence industry space with about 18 defence clients – or those with defence aspirations – on its books. Loading In April this year, it hosted its 'Fourth Pyne & Partners AUKUS Program' in Washington, DC, opening with a keynote address from Australia's Washington ambassador Kevin Rudd, along with contributions from former British defence secretary Sir Michael Fallon and the British Royal Navy's former second sea lord, Sir Nick Hine. The firm has also teamed with leading US government relations firm Baker Donelson to 'capitalise on the recent AUKUS defence agreement'. Pyne and Partners also represents British-based Rolls-Royce, slated to receive $4.6 billion in Australian taxpayer funds to build the nuclear propulsion systems for the future joint UK-Australian nuclear submarine (dubbed SSN-AUKUS) under AUKUS' so-called 'pillar 1'. (Pillar 1 is everything to do with the $368 billion program to acquire nuclear submarines; pillar 2 is about increasing allied collaboration on emerging technologies such as AI and robotics.) CMAX Advisory, the third of the most active lobbying firms in the defence space, was founded by Christian Taubenschlag, former staffer to one-time Labor defence minister Joel Fitzgibbon. Fitzgibbon holds the position of special counsel at CMAX, though he says there's little active lobbying involved. 'My role is to provide political and strategic advice to corporate entities. But on the rare occasions I do seek to persuade, I only do so if my interest in the matter is fully declared and I genuinely believe the case I'm making serves the interests of both the government and the country,' he said. He defends the role of lobbyists in the system, saying: 'Not every entity has the means to navigate the complexities of government and government decision-making processes in-house. And even when they do, they'll often need additional specialist guidance for specific projects.' Pyne, who did not respond to a request for an interview, expressed a similar view to The Australian Financial Review in March, saying: 'Lobbyists are a critical part of the system of Westminster government ... Anyone who doesn't understand that doesn't understand how government works.' None of the people in this article are accused of wrongdoing, breaching any rules or acting with conflicts of interest. Until three weeks ago, Fitzgibbon and Sinodinos had been co-chairing the advisory board of the not-for-profit AUKUS forum, which describes itself as a 'collaborative organisation of supporters across industry, academia, researchers, government and defence'. But both men quietly left the forum last month. Its chief executive officer Michael Sharpe is now understood to be focusing his efforts offshore in the US and Britain. That's indicative of a broader problem, which is that small and medium Australian defence companies are feeling frustrated by the growing realisation that any AUKUS bonanza – at least for them – is still a long way off. Loading For the next few years, AUKUS dollars are primarily going offshore or being earmarked for development of the infrastructure needed to support the nuclear-submarine project in Western Australia and South Australia. One well-connected defence industry player slams what he says is overblown talk by ministers, and lobbyists, about AUKUS opportunities. 'They're pitching bullshit,' the source says. 'There is no submarine construction here for years … The reality is, unless you're in the infrastructure game [building the shipyards and upgrading the bases] then right now you are not in the AUKUS game. And if you want to be in the AUKUS game, then you've got to be in infrastructure.' In late July, Defence Minister Richard Marles and his visiting British counterpart John Healey signed a 50-year pact to bolster the AUKUS agreement. Marles declared that it would 'underpin ... the biggest industrial endeavour that our nation has ever seen'. But Marcus Hellyer, head of research for Strategic Analysis Australia, warns that 'most of the high-value components are going to be imported. All of this stuff about [how] this will drive high-tech manufacturing in Australia, and it's our moon shot, all this kind of hyperbolic language, I think is completely misplaced'. He adds: 'We now have this very extensive class whose main purpose in life seems to be advocating for AUKUS and getting lots of very well-paid consultancy jobs.' This masthead does not suggest any wrongdoing or actual conflicts by any of the people named in this article. Where the money's going Analysts say that for the next few years, the vast bulk of the government's expenditure on the nuclear submarines will be directed at two things: bolstering industrial capacity in Britain and the US, and building enabling infrastructure here. As well as tipping $4.6 billion into Rolls-Royce's British factories, Canberra has promised $4.7 billion for US naval shipyards to help boost American production of Virginia-class nuclear submarines, three of which are destined for Australia. (The Albanese government has already made downpayments totalling $1.6 billion.) Billions more will then be required to upgrade facilities in WA to host and maintain nuclear-powered submarines and to build a new South Australian shipyard (probably near the existing Osborne facility) allowing eventual construction here. So far, $8 billion has been earmarked to expand HMAS Stirling, near Perth, which is supposed to host US nuclear submarines on rotation from 2027 onwards, with another $127 million allocated to design the upgrade of the Henderson defence precinct, also in WA. Eventually, the government claims, there will be $30 billion invested in the country's industrial base over the next 30 years. As for smaller companies down the food chain, right now there's not much, says ADCG's Gary Slater. 'AUKUS is not creating a lot of jobs for Australian industry at the moment ... [and] the government isn't providing a holistic overview of the nuclear-powered sovereign ecosystem, because they don't have one, because they don't have the expertise and the knowledge and the experience to map it out and to brief it.' Slater came to Australia two years ago to lead ADCG's nuclear consultancy group and has been designing the firm's 'nuclear masterclasses' pitched as a way to 'accelerate' AUKUS. He was hoping to get engagement from federal and state governments but those doors have remained firmly shut. For now, he has lowered his ambitions and is aiming the 'masterclasses' at smaller players, who are still scratching their heads over what AUKUS means for them. Slater is frustrated because 'we're two years away from rotation of US nuclear submarines in the West [WA] and there's been a distinct lack of public reporting, transparency and progress'. The Australian Industry and Defence Network (AIDN), an industry lobby group which represents smaller companies, also says AUKUS is still 'very much early days' for its members. Two hundred smaller firms have joined a 'prequalification' program for the local nuclear submarine build, when it eventually kicks off, and the government has earmarked $262 million to 'help Australian firms [eventually] join the AUKUS [pillar 1] supply chain'. But that's a drop in the bucket compared with the infrastructure and overseas spend. AIDN chief Mike Johnson warns that other defence programs are being 'sacrificed to fund AUKUS and marquee missile programs'. The big question remains whether Australia's acquisition of a sovereign nuclear-powered submarine fleet will survive the plethora of economic, political and technological challenges it faces. In the immediate future, all eyes are on Washington, DC, where a Pentagon review of AUKUS – under the sceptical eye of US undersecretary for defence Elbridge Colby – could impact the project's trajectory. There's a keen awareness that the US is already struggling to produce enough nuclear subs for its own demands, let alone three for Australia. Loading Added to that is the project's scale, complexity (a nuclear-powered submarine has about a million parts) and the 15-to-20-year lead times before Australian-built submarines would enter service. Addressing the Pyne & Partners AUKUS forum in Washington this year, Nick Hine said he had warned Australia's defence chiefs that 'from a cost perspective, whatever number you thought of, double it and add zero', and that, 'whatever timescale you had in your head, you are already late'. Yet such is the institutional weight and financial investment now building behind the submarine project, in particular, it looks locked in, no matter how much those challenges compound. As a recent British academic paper entitled 'Fortress AUKUS' by scholars Sarah Tzinieris and Zeno Leoni notes, 'a submarines shipbuilding program once in place unleashes powerful organisational and bureaucratic forces that favour maintaining the program'. Ghost Shark: What we know Anduril has big aspirations for its Ghost Shark autonomous underwater vehicle. Taxpayers have so far put in close to $100 million, with the company putting in the rest. The company established an Australian arm in March 2022, citing the expanded opportunities created by AUKUS, and almost immediately pitched the Ghost Shark idea to the RAN. Three years later, it has delivered three vessels and is trialling a fourth in the United States. Defence industry minister Pat Conroy hails it as 'an exemplar of how Defence and Australian industry can move at speed to develop new sovereign capabilities to respond to the challenges before us'. The government rushed to unleash funds for it under a little-known program called the Advanced Strategic Capabilites Accelerator. Some industry sources believe the jury is still out on its success. The company doesn't release exact dimensions or range. It says a Ghost Shark recently concluded a 100-hour single voyage, and that it's the 'size of a bus in its smallest configuration and subway car in its biggest'. Conroy says it will conduct 'stealthy, long-range autonomous undersea warfare capability that can conduct persistent intelligence, surveillance, reconnaissance and strike, and enhance Navy's ability to operate with allies and partners' – putting it in contention for AUKUS pillar 2 operations.

The Age

10 hours ago

The Age

Battle stations: The former PM, ministers, and military brass cashing in on Australia's defence spending bonanza

Early last year, United States technology company Anduril, co-founded by colourful American entrepreneur and Trump enthusiast Palmer Luckey, unveiled a coup in the highly competitive world of defence industry. The company announced it had hired the Royal Australian Navy's former head of naval capability, rear admiral Peter Quinn, to join its Australia and Asia Pacific team as vice-president of strategy, to 'accelerate' its regional business. It was a timely catch for Anduril. For five years, Quinn had occupied a high-level navy post in which his job was to identify the navy's future capability needs. He still held the post in May 2022, when the Defence Department handed Anduril a $77 million limited tender contract to develop a new capability for the fleet: the Ghost Shark. This was a daring design for an autonomous under-sea vehicle (AUV) – an uncrewed robot submarine – still then in prototype. Quinn, who had been one of the signatories on the original Ghost Shark agreement, left the navy at the end of 2022. He took a year's break – the minimum 'cooling off' period mandated by the navy – then joined Anduril in January 2024. In all, 13 months had elapsed between him leaving the navy and joining the ambitious American company. This raised some eyebrows, but there was even more widespread grumbling about the fact such a large project had not gone to open tender. 'That didn't pass the pub test,' complained one industry source, who said he took calls from annoyed potential competitors. Total combined investment in the project has climbed to more than $160 million, with three prototype Ghost Sharks delivered to the RAN and costs shared between the company and Defence through a fast-track process the government has dubbed the 'advanced strategic capabilities accelerator'. Quinn's hiring is far from unique. It fits within a decades-long tradition of senior ADF personnel, ministers and political staffers taking up posts with large defence companies or defence-related advisory and lobbying services after leaving public life or active service. As Australia's total defence spending climbs beyond $59 billion a year, and the AUKUS trilateral security pact looms large on the horizon, the phenomenon is set to intensify as firms jostle for an inside track. It extends to former politicians and political staffers on both sides of politics. Naturally, those who have served in Defence or shadow defence portfolios have been in hottest demand. The list includes former ministers Christopher Pyne, Kim Beazley, Arthur Sinodinos, Stephen Conroy, Joel Fitzgibbon, David Johnston, former Liberal opposition leader Brendan Nelson and former prime minister Scott Morrison. And the federal government's register of lobbyists shows dozens of former staffers who have joined advisory firms with defence clients. Among them are Paul Chamberlin, former staffer to three Nationals leaders; Carl Ungerer, a former national security adviser to one-time Labor leader Simon Crean; Michael Choueifate, a one-time chief of staff to Anthony Albanese; Adam Howard, the former chief of staff to Pyne; and Tony Hodges, a former staffer to then-shadow defence minister Richard Marles and former prime minister Julia Gillard. Anduril says it cleared Quinn's recruitment with the Defence Department and it was within RAN rules. Nor, the company insists, has Quinn had any involvement with the Ghost Shark or the company's maritime business since he joined its executive team. (Quinn did not respond directly to questions put to him through Anduril.) But Greens defence spokesperson David Shoebridge says the rules should change so there is a 'rock-solid prohibition on the decision-makers for multibillion-dollar tenders ever going to work for the companies that win the contracts'. Defence deflected questions about Quinn's role in the original Anduril contract but said 'movement of staff between Defence and Defence industry is important as we work together to train and retain the highly skilled and experienced workforce needed to deliver Australia's national security'. It added 'post-service employment of former ADF members is managed in line with Defence policy to mitigate any real or perceived conflicts of interest'. As one consultant sees it, 'the value to industry of these guys is that they can map a very complicated procurement process inside the Department of Defence and at a political level as well. If you're [an outsider] your understanding of the stakeholders is very low, and it's very difficult to get that understanding without hiring someone who has been in the system ... It's often a total lasagne of people whose names aren't available through Google.' This masthead does not suggest any improper conduct on the part of Anduril or Quinn, including that his involvement in the Ghost Shark agreement was influenced by the possibility of future employment with the company. Rather, broader questions remain about the stringency of rules around post-ADF employment. Former judge Anthony Whealy – chair of the Centre for Public Integrity, which has recently called for an overhaul of lobbying regulations – believes there should be a minimum three-year 'cooling-off period' before politicians, senior officials and senior ADF figures take up private employment in fields that related to their duties while in public life. (Currently ministers cannot lobby on matters they had official dealings with until 18 months after leaving office.) Shoebridge says 'unfortunately, the revolving door between Defence and arms companies is going strong'. Anduril's nimble manoeuvring in a sector bedevilled by chronic delay has some admirers, though. 'Anduril are the answer to a problem,' argues former US marine Gary Slater, now with the Australian Defence Consultancy Group. 'They move fast, they break things, they're cashed up with venture capital. They have truly cutting-edge technology that [jumps] from idea to design to prototype in months, not years.' Senior former ADF personnel are, in the meantime, liberally sprinkled throughout the private defence sector. A prominent example is former chief of the Defence Force Mark Binskin, who holds the post of executive director for defence and national security at BAE Systems Australia, an offshoot of the British company that has been hand-picked to help construct Australia's own nuclear-powered submarine fleet under the AUKUS pact. Former navy chief Tim Barrett is a non-executive director at BAE Systems Australia. Neither Binskin nor Barrett have any involvement with the AUKUS submarines, according to a BAE spokesman. Retired rear admiral Lee Goddard has become strategic adviser to Australian Missile Corporation, part of the Queensland-based Nioa armaments group, which has offices in Britain and the US and also has AUKUS ambitions. Former rear admiral Mark Purcell has been snapped up as a senior adviser by former treasurer Joe Hockey's lobbying firm, Bondi Partners, which is also active in the AUKUS space, while retired rear admiral Chris Ritchie, another ex-navy chief, has only just left the board of patrol boat manufacturer Luerssen following its merger with engineering firm Civmec. The chief executive of Lockheed Martin Australia and New Zealand is a former senior RAAF officer, Warren McDonald, who joined the company in 2021, a year after leaving his post as chief of joint capabilities inside the Defence Department. The lobbyists Canberra insiders say three lobbying firms dominate the defence space: TG Public Affairs, Pyne and Partners, and CMAX Advisory. Each have client lists extensively documented on the federal government's lobbyists register. TG Public Affairs, which represents 15 of the top 40 companies contracting to defence, boasts a heavyweight advisory board, chaired by former communications and shadow defence minister Conroy, sitting alongside former defence ministers Beazley, David Johnston and a former deputy secretary of the Defence Department Steve Grzeskowiak. Its clients include a number of the 'primes' (as the big contractors to defence are known) such as Lockheed Martin Australia, Saab, Northrop Grumman and Rheinmetall Defence. Former Liberal defence and defence industry minister Christopher Pyne's eponymous lobbying firm has established itself as another energetic player in the defence industry space with about 18 defence clients – or those with defence aspirations – on its books. Loading In April this year, it hosted its 'Fourth Pyne & Partners AUKUS Program' in Washington, DC, opening with a keynote address from Australia's Washington ambassador Kevin Rudd, along with contributions from former British defence secretary Sir Michael Fallon and the British Royal Navy's former second sea lord, Sir Nick Hine. The firm has also teamed with leading US government relations firm Baker Donelson to 'capitalise on the recent AUKUS defence agreement'. Pyne and Partners also represents British-based Rolls-Royce, slated to receive $4.6 billion in Australian taxpayer funds to build the nuclear propulsion systems for the future joint UK-Australian nuclear submarine (dubbed SSN-AUKUS) under AUKUS' so-called 'pillar 1'. (Pillar 1 is everything to do with the $368 billion program to acquire nuclear submarines; pillar 2 is about increasing allied collaboration on emerging technologies such as AI and robotics.) CMAX Advisory, the third of the most active lobbying firms in the defence space, was founded by Christian Taubenschlag, former staffer to one-time Labor defence minister Joel Fitzgibbon. Fitzgibbon holds the position of special counsel at CMAX, though he says there's little active lobbying involved. 'My role is to provide political and strategic advice to corporate entities. But on the rare occasions I do seek to persuade, I only do so if my interest in the matter is fully declared and I genuinely believe the case I'm making serves the interests of both the government and the country,' he said. He defends the role of lobbyists in the system, saying: 'Not every entity has the means to navigate the complexities of government and government decision-making processes in-house. And even when they do, they'll often need additional specialist guidance for specific projects.' Pyne, who did not respond to a request for an interview, expressed a similar view to The Australian Financial Review in March, saying: 'Lobbyists are a critical part of the system of Westminster government ... Anyone who doesn't understand that doesn't understand how government works.' None of the people in this article are accused of wrongdoing, breaching any rules or acting with conflicts of interest. Until three weeks ago, Fitzgibbon and Sinodinos had been co-chairing the advisory board of the not-for-profit AUKUS forum, which describes itself as a 'collaborative organisation of supporters across industry, academia, researchers, government and defence'. But both men quietly left the forum last month. Its chief executive officer Michael Sharpe is now understood to be focusing his efforts offshore in the US and Britain. That's indicative of a broader problem, which is that small and medium Australian defence companies are feeling frustrated by the growing realisation that any AUKUS bonanza – at least for them – is still a long way off. Loading For the next few years, AUKUS dollars are primarily going offshore or being earmarked for development of the infrastructure needed to support the nuclear-submarine project in Western Australia and South Australia. One well-connected defence industry player slams what he says is overblown talk by ministers, and lobbyists, about AUKUS opportunities. 'They're pitching bullshit,' the source says. 'There is no submarine construction here for years … The reality is, unless you're in the infrastructure game [building the shipyards and upgrading the bases] then right now you are not in the AUKUS game. And if you want to be in the AUKUS game, then you've got to be in infrastructure.' In late July, Defence Minister Richard Marles and his visiting British counterpart John Healey signed a 50-year pact to bolster the AUKUS agreement. Marles declared that it would 'underpin ... the biggest industrial endeavour that our nation has ever seen'. But Marcus Hellyer, head of research for Strategic Analysis Australia, warns that 'most of the high-value components are going to be imported. All of this stuff about [how] this will drive high-tech manufacturing in Australia, and it's our moon shot, all this kind of hyperbolic language, I think is completely misplaced'. He adds: 'We now have this very extensive class whose main purpose in life seems to be advocating for AUKUS and getting lots of very well-paid consultancy jobs.' This masthead does not suggest any wrongdoing or actual conflicts by any of the people named in this article. Where the money's going Analysts say that for the next few years, the vast bulk of the government's expenditure on the nuclear submarines will be directed at two things: bolstering industrial capacity in Britain and the US, and building enabling infrastructure here. As well as tipping $4.6 billion into Rolls-Royce's British factories, Canberra has promised $4.7 billion for US naval shipyards to help boost American production of Virginia-class nuclear submarines, three of which are destined for Australia. (The Albanese government has already made downpayments totalling $1.6 billion.) Billions more will then be required to upgrade facilities in WA to host and maintain nuclear-powered submarines and to build a new South Australian shipyard (probably near the existing Osborne facility) allowing eventual construction here. So far, $8 billion has been earmarked to expand HMAS Stirling, near Perth, which is supposed to host US nuclear submarines on rotation from 2027 onwards, with another $127 million allocated to design the upgrade of the Henderson defence precinct, also in WA. Eventually, the government claims, there will be $30 billion invested in the country's industrial base over the next 30 years. As for smaller companies down the food chain, right now there's not much, says ADCG's Gary Slater. 'AUKUS is not creating a lot of jobs for Australian industry at the moment ... [and] the government isn't providing a holistic overview of the nuclear-powered sovereign ecosystem, because they don't have one, because they don't have the expertise and the knowledge and the experience to map it out and to brief it.' Slater came to Australia two years ago to lead ADCG's nuclear consultancy group and has been designing the firm's 'nuclear masterclasses' pitched as a way to 'accelerate' AUKUS. He was hoping to get engagement from federal and state governments but those doors have remained firmly shut. For now, he has lowered his ambitions and is aiming the 'masterclasses' at smaller players, who are still scratching their heads over what AUKUS means for them. Slater is frustrated because 'we're two years away from rotation of US nuclear submarines in the West [WA] and there's been a distinct lack of public reporting, transparency and progress'. The Australian Industry and Defence Network (AIDN), an industry lobby group which represents smaller companies, also says AUKUS is still 'very much early days' for its members. Two hundred smaller firms have joined a 'prequalification' program for the local nuclear submarine build, when it eventually kicks off, and the government has earmarked $262 million to 'help Australian firms [eventually] join the AUKUS [pillar 1] supply chain'. But that's a drop in the bucket compared with the infrastructure and overseas spend. AIDN chief Mike Johnson warns that other defence programs are being 'sacrificed to fund AUKUS and marquee missile programs'. The big question remains whether Australia's acquisition of a sovereign nuclear-powered submarine fleet will survive the plethora of economic, political and technological challenges it faces. In the immediate future, all eyes are on Washington, DC, where a Pentagon review of AUKUS – under the sceptical eye of US undersecretary for defence Elbridge Colby – could impact the project's trajectory. There's a keen awareness that the US is already struggling to produce enough nuclear subs for its own demands, let alone three for Australia. Loading Added to that is the project's scale, complexity (a nuclear-powered submarine has about a million parts) and the 15-to-20-year lead times before Australian-built submarines would enter service. Addressing the Pyne & Partners AUKUS forum in Washington this year, Nick Hine said he had warned Australia's defence chiefs that 'from a cost perspective, whatever number you thought of, double it and add zero', and that, 'whatever timescale you had in your head, you are already late'. Yet such is the institutional weight and financial investment now building behind the submarine project, in particular, it looks locked in, no matter how much those challenges compound. As a recent British academic paper entitled 'Fortress AUKUS' by scholars Sarah Tzinieris and Zeno Leoni notes, 'a submarines shipbuilding program once in place unleashes powerful organisational and bureaucratic forces that favour maintaining the program'. Ghost Shark: What we know Anduril has big aspirations for its Ghost Shark autonomous underwater vehicle. Taxpayers have so far put in close to $100 million, with the company putting in the rest. The company established an Australian arm in March 2022, citing the expanded opportunities created by AUKUS, and almost immediately pitched the Ghost Shark idea to the RAN. Three years later, it has delivered three vessels and is trialling a fourth in the United States. Defence industry minister Pat Conroy hails it as 'an exemplar of how Defence and Australian industry can move at speed to develop new sovereign capabilities to respond to the challenges before us'. The government rushed to unleash funds for it under a little-known program called the Advanced Strategic Capabilites Accelerator. Some industry sources believe the jury is still out on its success. The company doesn't release exact dimensions or range. It says a Ghost Shark recently concluded a 100-hour single voyage, and that it's the 'size of a bus in its smallest configuration and subway car in its biggest'. Conroy says it will conduct 'stealthy, long-range autonomous undersea warfare capability that can conduct persistent intelligence, surveillance, reconnaissance and strike, and enhance Navy's ability to operate with allies and partners' – putting it in contention for AUKUS pillar 2 operations.

Unions to demand employers be forbidden from using AI for ‘mass redundancies'

The Age

4 days ago

The Age

Unions to demand employers be forbidden from using AI for ‘mass redundancies'

The Australian Council of Trade Unions will demand that employers guarantee workers' job security before introducing artificial intelligence into their businesses in a bold proposal that will inflame tensions before the Albanese government's productivity roundtable next month. The council's assistant secretary Joseph Mitchell will use a speech on Tuesday to send a message that the union movement expects Labor to push through legislation to bar the use of AI at businesses that cannot reach agreements with their employees. 'It is necessary to have a comprehensive AI act to ensure that such bad-faith uses of this technology are protected against,' Mitchell will say in a speech to the Melbourne University Productivity Flash Forum, according to draft speech notes seen by this masthead. 'Workers will be all in if they know doing so will not cost them their jobs.' Business groups have argued that artificial intelligence presents a multibillion-dollar opportunity for Australia to improve its productivity, arguing it will allow workers to be redeployed to higher-skilled jobs and calling for any safeguards not to impede the uptake of the technology. Treasurer Jim Chalmers will host the roundtable from August 19 to 21 to address Australia's flatlining productivity, hoping it will generate ideas for economic reform. Loading A similar summit hosted by the Albanese government at the start of its first term contributed to the legislation of key union priorities such as letting labour organisations bargain across multiple employers, upsetting business groups. Mitchell will argue that the biggest productivity gains come from businesses that use AI in a consultative way and respect workers' skills. 'Employers should be required to reach AI-implementation agreements with their staff before new technologies are introduced into workplaces,' Mitchell will say, saying agreements should include requirements on job security, privacy and retraining.

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