Page 36 - May 2019

Defence
Defence Budget Summary

– Steady as she goes, but spending risk remains

The government is on track to lift
Defence funding to the fabled two
per cent of GDP in 2020/21, but that
could involve a substantial $3 billion
jump which Defence may find difficult
to spend.
For 2019/20, the total defence
budget will be $38.7 billion – up from
$36.4 billion in 2018-19 – which takes
Defence’s share of GDP to 1.93 per cent.
This year’s Defence budget papers
are free of surprises or any new spending
on new equipment. The big projects are
already under way and with an election
looming, the government can gain
better headlines with announcements
away from the budget and during the
election campaign.
Defence Minister Christopher
Pyne said the budget maintained the This budget featured strong investment in national security with a particular focus on
government’s commitment to grow the enhancing regional security, building defence capability, and supporting sovereign
Defence budget to two per cent of gross defence industry. Photo CPOIS Cameron Martin.
domestic product (GDP) by 2020/21.
He said this budget featured strong jump. They actually need an increase start of prototyping of the new Hunter
investment in national security with a of $3 billion to get to two per cent next class frigates.
particular focus on enhancing regional year. The budget papers show the ramp
security, building defence capability, “Increasing spending quickly is up of spending on major acquisition
and supporting sovereign defence always hard, particularly if you are projects. Heading the list is the
industry. relying on things like shipbuilding which acquisition of Lockheed Martin F-35A
Minister Pyne said Australia are pretty slow to ramp up.” Lightning II fighters, with $2.389 billion
would continue to make a meaningful Mr Hellyer said that could actually to be spent in 2019-20. The first two
contribution to the US-led international be quite challenging for Defence, as of a planned 72 arrived in Australia
mission to counter the Islamic State that involved a 5.3 per cent increase in in December and 19 more are to be
group in Iraq. Australia has around spending in real-terms. delivered by the end of next year.
400 personnel in Iraq engaged in With the federal election looming, The remaining four of 12 Boeing
training Iraqi security forces under Task the Australian Signals Directorate (ASD) P-8A maritime patrol aircraft will be
Group Taji. Similarly, he said Australia and the Australian Cyber Security Centre delivered in 2019/20 with $360 million
remained committed to assisting the (ACSC) have a special responsibility of the $5.3 billion project cost to be
government of Afghanistan to ensure to protect government information paid out, although there was no word
the country never again became a safe networks from hostile intrusion, and to on the three additional P-8As that
haven for terrorists. safeguard the integrity of the poll. were optioned when aircraft 9-12 were
Australian Strategic Policy Institute The government is investing in announced in early 2016.
(ASPI) senior analyst Marcus Hellyer the creation of cyber security ‘Sprint Spending on the Hunter class
said the 2019/20 Defence budget Teams’, and a cyber security response frigates next year will more than double
spending of $38.7 billion meant the fund, but won’t say how much this will to $492 million. But somewhat curiously,
government was on track to take cost “due to national security reasons”. spending on the Attack class submarine
defence spending to two per cent of Minister Pyne said development project falls from $456 million last year
GDP on 2020/21. of the Osborne North Shipyard was to $289 million despite the budget
“But actually the budget has continuing in preparation for construction papers saying the submarine program
remained pretty flat from last year to this of the 12 new Attack class submarines, will continue working with Naval Group
year. It is only a 1.2 per cent increase while the $535 million redevelopment and Lockheed Martin Australia on the
in real terms,” Mr Hellyer said. “To get at Osborne South was on track for submarine design.
to two per cent next year is quite a big completion next year in time for the Courtesy Australian Defence Business Review

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