Looks like the RAN or at least the Adelaide City Council will have to invest in some top class bakeries as the French invade, err, assist the local shipbuilding industry in building new submarines, as French company DCNS wins the bid.
More from Fairfax:
Prime Minister Malcolm Turnbull has announced all 12 of Australia’s next fleet of submarines will be built in Adelaide from local steel, with France winning the hard-fought global race for the $50 billion contract.
Mr Turnbull said in Adelaide on Tuesday morning that the decades-long program would create about 2800 direct jobs and help Australia transition to a 21st century economy.
“Over decades to come, the submarine project alone will see Australian workers building Australian submarines with Australian steel here, where we stand today, for decades into the future. Fifty years from now, submarines will be sustained [and] built here. Surface vessels will be built here because of the commitment we have made to this great national endeavour of building Australia’s navy of the 21st century.
“We do this to secure Australia, to secure our island nation. But we do it also to ensure that our economy transitions to the economy of the 21st century.”
It was a race between France, Germany and Japan – but little examination by local media into what is Australia’s biggest defence contract ever with most analysts falling in line with the Defence Department view that the French version – a conventional modification of the nuclear powered Barracuda – was the best “pick”.
The strategic overview of this decision is two-fold but also leaves a lot of questions unanswered. First of all, building them locally does give the advantage of retained strategic potential to build more, as opposed to waiting for foreign supply. But that is negated by the fact that a majority of the systems – most of them critical – will be sourced offshore. It seems Australia will supply the brawn, and French, American and other nations the brains. There’s no point being able to build locally if all you have are empty steel cylinders without weapons or firing systems…
The mammoth cost of building locally, to support local jobs and industry (read: political donors and votes), as opposed to buying off-the-shelf has also not been scrutinised adequately.
Secondly, not buying them off the Japanese gives the Turnbull government an “out” with regard to Chinese opposition as opposed to the former Abbott government’s insistence of doing so with China’s largest neighbour.
Further, does the RAN need a fleet twice the size it currently has – six Collins class submarines – and does it have a contingency plan for being able to man the vessels at anywhere near a readiness footing? During the mining boom it was unable to field more than two or three boats at a time due to manpower shortages and still struggles to do so now, although it recently has been able to field a fourth boat’s company. How is it going to do double that in the years ahead? Combined with some questions about cost overruns on maintenance, where is the analysis on being able to perform such a task with a fleet twice the size?
Finally it has to be acknowledged that ADF procurement over the years has been a litany of failures, cock-ups and oversights in terms of budget overruns, capability gaps, conversion problems, systems integration and political machination. Starting with the Collins class subs, through to the Kanimbla/Manoora conversion/writeoffs, the Super Seasprite cancellation, and numerous upgrade programs (FFG) – not least the other services problems e.g Army’s Tiger helicopter – it remains to be seen if this massive contract can be managed effectively domestically.
The final question is can the country afford it? I suppose $50 billion is chump change when that alone is given up every year in a combination of tax concessions and fees to the superannuation industry for maintaining something that mustn’t go underwater.