Defence $6.5bn blowout
Minister demands military precision
THE Defence Department has been told it will need to “justify every dollar it spends” after it was revealed to be one of the worst offenders in terms of budget blowouts.
Defence Minister Richard Marles confirmed 28 major military projects, including the Hunter-class frigates, were running behind schedule by a cumulative 97 years and over budget by $6.5bn.
Speaking in Canberra after the revelations, Mr Marles said the department was “not immune from scrutiny” and would need to “carry its weight” in repairing the budget.
“We completely understand that. Defence needs to justify every dollar it spends,” he said.
Mr Marles promised to bring in new measures to make the department accountable to government, including monthly updates on projects of concern to get them back on track.
“We accept the responsibility of government and we do so going forward. No ifs, no buts about all of that,” he said.
Earlier, Mr Marles said it would be a “real challenge” to deliver the delayed projects on time and within budget while reducing the department’s long-running strain on the federal budget. “I think Defence has been a pretty significant offender over the last 10 years and we certainly mean to change that going forward,” he told ABC Radio.
“We know that Defence spending is increasing, we know it represents one of the medium to long-term pressures on the budget, and what the long-term requires is that the quality of spending needs to be excellent.”
Mr Marles said Australia “can’t afford” to have gaps in its Defence capability, promising to improve delivery with monthly reports on each of the delayed projects.
He sought to blame the Coalition, saying the Albanese government “inherited a complete mess”.
Mr Marles argued the Coalition had focused on the “hoopla” of Defence announcements while allowing the delivery of projects to get out of control.
The opposition is expected to retaliate by saying Defence spending fell to its lowest amount in GDP terms since 1938 under the Rudd and Gillard Labor governments.
The Albanese government earlier this year ordered an independent review of the Defence Department that is due to provide its recommendations by March next year.
Defence expenditure is set to increase to more than $80bn by 2032.
Treasurer Jim Chalmers last week warned that Defence was one of the “big five” cost blowouts facing the federal budget amid debate over whether the “stage 3” tax cuts should be pared back.
Mr Marles told ABC Radio that wasteful defence spending must “come to a stop”, but he insisted Labor hadn’t changed its position on the tax cuts.
The stage 3 cuts will abolish the entire 38 per cent tax bracket from 2024, meaning anyone earning between $45,000 and $200,000 will pay only 30c in tax for every dollar they earn.