Senator MURRAY (1:15 PM) —I rise to speak this afternoon in my capacity as customs spokesperson for the Democrats and as a Western Australian senator. In July I visited the Pilbara region in Western Australia to go on a familiarisation tour and to meet with a number of representatives from industry and from community organisations. In addition to its natural beauty, its fascinating history, its cultural heritage and its environmental importance, the Pilbara makes an immense contribution to the national economy. The Pilbara is a region of great national economic and strategic significance. Exports fetch billions of dollars. The Pilbara is responsible for the production of goods and services worth more than $16 billion per annum. This predominantly comes from the mining and petroleum industries. More than 95 per cent of Australia's iron ore exports come from the Pilbara.

However, its largest export industry is oil and gas, which earns almost $10 billion per annum. The major oil and gas project in the Pilbara is the North West Shelf joint venture. In 2001, the venture produced around $8 billion worth of oil, liquefied petroleum gas, condensate and gas for the Western Australian market and for export to Japan as LNG. Now there is the China deal as well. The venture accounts for around one-third of Australia's oil and condensate production and 44 per cent of Australia's gas production. Woodside claims that the North West Shelf venture is responsible for creating and maintaining more than 80,000 jobs Australia wide through the greater economic activity generated by the project. This region is rightly regarded as a major contributor to the Australian economy.

In these worrying times of national security, border security and terrorism, any major economic and strategic area or infrastructure requires enhanced attention. There cannot be many places in Australia more major than the Pilbara. In a broad sense, I am aware of the police, intelligence, Navy, Air Force and Army facilities and resources available to react if vital areas of the Pilbara are threatened. But prevention and deterrence are key considerations. The Pilbara needs the addition of an extra deterrent capability that is presently absent. I have done some research, and must acknowledge the help of the Parliamentary Library as well as a number of individuals.

Just prior to my visit, a boat containing asylum seekers was seen not far off the coast of Port Hedland. It had apparently not been detected until it was quite close to the shore, despite the large number of petroleum exploration and production vessels and helicopters in the area. This raised public questions as to the level of security and surveillance in the area. Some of the people with whom I met offered suggestions as to how maritime security might be improved. One suggestion was that a coastguard service was a good idea. The coalition government have fought shy of the coastguard option, but its success for many countries means it is worth considering for Australia. The Pilbara offers a perfect opportunity to field test a coastguard option, not just for this critically important strategic area but for other strategic areas on the Australian coastline. My view is that a trial in the seas off Karratha and Dampier would be an excellent idea.

Given the public debate about border security and national security, the role of the Royal Australian Navy and the suitability of a coastguard for Australia, a trial provides a perfect and cost-effective opportunity to explore these issues in a practical setting. For operations in the Karratha area that would allow for coastguard type functions out to the 200 nautical mile limit in sea states up to and including sea state five, two 35-metre Bay class patrol vessels should more than suffice. These types of vessels are built by the WA shipbuilder Austal, but Tenex in Victoria or New South Wales could also undertake construction of this sort. Due to their costs, catamarans of the type built by Incat in Tasmania are unlikely to be appropriate as a platform for the type of trial envisaged.

As we learned from the recent long sea chase to capture the toothfish pirates, Australian Customs already has maritime experience and capability. Customs currently operates eight vessels of the Bay class. There are no catamarans in enforcement or interdiction service in Australia. Given the sea conditions that dominate the proposed area of operations, the trial vessels could be of either aluminium or steel construction. Were operations to extend to waters off south-west Western Australia, where sea states conditions five and six are likely to be encountered on a regular basis, steel construction might be the preferred option. The advantage of steel construction is that in sea states three to five the vessels would ride better in the water. In sea states of six or more, a small vessel such as a 35-metre Bay class patrol ship would need to seek shelter in port. The advantage of aluminium construction is that the vessels would cost approximately 15 per cent less per day to operate at sea.

The key personnel issues to consider are as follows: a 35-metre vessel would require a crew of some six to eight persons. If there were a requirement for the vessel to also provide a boarding party, the minimum crew number would be 15 persons. The Navy tend to assign a crew to a vessel and then not rotate them off. Consequently, Navy crews tend to spend some six weeks at sea with a two-week rest period ashore. On the other hand, Australian Customs assigns two crews per vessel and rotates the crew off the ship. Customs crews do a tour at sea of three weeks, followed by three weeks ashore.

The key financial considerations are as follows: Navy officer personnel of the rank appropriate for service in small ships earn approximately $76,000 per annum while undertaking sea duty, while their Customs equivalent earns $95,000. However, Navy must maintain equivalent crew numbers in shore billets, while Customs simply rotates personnel from two crews. What this means is that the equivalent cost for Customs is one salary for one year versus the naval requirement to have, in effect, two salaries for the same ship each year. In addition Navy procurement methods are more complicated than Customs. For Navy, approximately an additional one person is salaried per five seagoing personnel. If the Customs personnel system were adopted, the trial would require four crews of 15 persons at an annual salary cost of about $5.7 million. Taking into account the total cost of operating, the Navy direct cost for one year would be greater.

A Bay class patrol vessel can be purchased for approximately $7 million. There would also be an option of leasing patrol vessels, the cost of which I do not know. The daily operating cost of a Bay class vessel is approximately $15,000. The annual operating cost for ensuring one vessel remained on station 365 days a year would be approximately $5.475 million. For two vessels total annual operating expenses would be approximately $10 million, understanding that storms and other contingencies would prevent both vessels being at sea 365 days a year. Roughly speaking, the total cost for two vessels looks to be just under $30 million for the first year of operation.

An important issue that needs to be considered is whether any fleet should be built to a commercial, as opposed to a military, standard. The chief difference—aside from the absence of major naval weapons system and classified electronic and communications suites—is that a warship for Navy is intended to float, move and fight, with considerable redundancy of onboard systems. Commercial vessels constructed for a coastguard would not be built with a view to saving the ship in the event of any accident; they are built to save the crew.

From a personnel perspective, Navy crews its smaller vessels in a manner conducive for quick transfer to billets in larger service combatants. Therefore there is both bridge and engine room watch-keeping in naval vessels, whereas in Customs and commercial vessels remote engine room monitoring is common. The monitoring requirements in naval vessels for other crew functions are also more rigorous than in Customs or commercial vessels. In addition, some functions, such as catering, are a dedicated function in naval vessels but a shared responsibility on Customs and commercial vessels. All of these factors add costs to naval operations not encountered by enforcement agencies. A coastguard service, in other words, would be more flexible and less costly.

There are a number of countries throughout the world that use coastguards. These precedents can provide us with guidance as to how to approach the task of a coastguard trial off the Pilbara in Australia. The largest coastguard in the world is the United States Coastguard. The US Coastguard has a military structure and is therefore similar to the Royal Australian Navy and it has law enforcement authority similar to that enjoyed by the Australian Federal Police and Customs. It undertakes humanitarian functions such as those exercised by the equivalent of the Western Australia State Emergency Service.

The United States Coastguard operates 137 patrol vessels up to and including frigates equivalent in size to the largest major service combatants in the Royal Australian Navy. It has a strength of 39,000 active duty personnel. In contrast, the Royal Australian Navy has 12½ thousand personnel. The United States Coastguard budget for 2002 was $US5.181 billion, a figure that equates to approximately half of the entire current Australian defence budget.

In contrast to the United States Coastguard—which might be regarded as a deluxe service—the Canadian Coast Guard is an organisation whose functions are focused on community safety in the maritime environment and enforcement of laws and regulations. There are no vessels in the Canadian Coast Guard inventory that could be classified as major service combatants and therefore this service more closely mirrors the type of coastguard that might be affordable in Australia if policy makers chose to divorce the coastguard function from the war fighting functions of the Australian Navy.

The maritime patrol area of the Canadian Coast Guard is broadly comparable with that of Australia, with an increased emphasis in their case on operations in Arctic waters. The roles of the Canadian Coast Guard include a collection of marine programs and services such as search and rescue, boating safety, environmental response, marine navigation services, marine communications and traffic services, and navigable waters protection. The Canadian Coast Guard does have law enforcement, border protection and immigration responsibilities. It also earns fees from undertaking ice-breaking services for commercial shipping, imposing radio tolls and so on. These services reduce the expense of running the coastguard. Opportunities for any savings in Australia through providing services for a fee might be worth considering.

My objective in delivering this speech is not to set out a particular coastguard model that would be appropriate for Australia. That is a matter for government and it is a matter for the government to consider at some length. My concern is that there is no sign that this government is prepared to consider this option with any seriousness. Yet it is quite clear from my discussions in the Pilbara that the deterrent capacity which would be afforded by a coastguard function is just not available. Everyone who has had anything to do with the armed forces or security or intelligence knows that it is very difficult to protect any infrastructural facility completely, but a deterrent capacity has a great effect on general surveillance possibilities and the general ability of people to determine whether a place should be targeted or not. I have hoped through this speech to draw attention to some of the issues that surround the possible creation of an Australian coastguard. I am of the view that a trial would be worth while. It would be cost effective and it would be a very sensible option, I think, for Australia to pursue.

Senator McGauran —We have looked at it.

Senator MURRAY —I take the interjection from Senator McGauran. As the chamber knows, Senator McGauran has absolutely no experience in military affairs whatsoever and has no competence in this field. So he is just shouting there as a loudmouth through the chair. It would be better for the country if he kept his mouth shut on issues about which he knows very little. Given the immense strategic and economic significance of Karratha and surrounding regions, I think it would be a good location to trial increased security measures and I do hope that people more competent than Senator McGauran will look at this issue seriously.