Senator MARK BISHOP (7:01 PM) —I move:

The tabling of this statement of corporate intent is not, it must be said at the outset, a matter of any great importance or consequence. In fact, the statement is little more than a glossy statement of mission and values. As such, it looks good and it is warm and friendly. Underneath that veneer, however, there are some real issues that need to be addressed. Those issues are revealed in much greater detail in the annual report of the corporation. The last of these, for the financial year 2004, was tabled late last year. On the basis of the 2004 annual report, we certainly look forward to reviewing the 2005 report when it is tabled in due course.

It is common knowledge that much has happened recently with respect to decisions on naval shipbuilding in this country. Putting aside all of the years of drama connected with the Collins class submarines, it does seem to be fair to comment that the future for the ASC is indeed a bright one. The corporate history and the whole sorry saga of a major defence procurement project way over budget and way over time are now, it must be said, matters for the past and matters of academic interest to historians. Unfortunately, though, we keep seeing the same pattern developing over and over again within the realm of defence procurement.

From the ASC’s viewpoint, though, we are pleased to see the state of its current corporate good health. Last year’s annual report showed a healthy profit stream. With the finalisation of the through-life support contract for the submarine fleet, that result should continue. Indeed, it would be surprising if it did not. Certainly as a centre of excellence for submarine construction and maintenance, the ASC has now established itself. That is a tribute to its board and to its work force. It goes without saying that the ASC has now become a base element of industry in South Australia. It is of course important for West Australian industry as well. It goes without saying that the ASC has now also become, and should be into the future, a major part of the Australian shipbuilding industry.

The successful bid for the three air warfare destroyers can, I believe, only be interpreted as a vote of confidence in the ASC. This massive project is important for a number of reasons. First of all, it will employ many Australians, all around the country. These ships are to be constructed in modular fashion in both the west and in New South Wales. These sections will be brought together at the ASC site in Adelaide, which is now being prepared for expansion. As a consequence of that, there will be demand for a whole new set of skills.

It should be noted, too, that the cooperative approach with the South Australia government will see a whole new phase of training begin. That was one of the commitments that that government gave to the Commonwealth as an aid to getting the project into South Australia. At a time when the motor vehicle industry in that state has taken some knocks, it is fair to say that this is a useful development. It is also pleasing to see that the government did not procrastinate with the question of local construction and the alleged price advantage of overseas options. No doubt the needs of South Australia had a part in that decision—as, one could say, given that the state is doing it tough, it should. No doubt establishing the company on a sound basis for future sale was also part of it.

But it is a great pity that, when it came to the decision to build the two amphibious lift ships, the same commitment was not forthcoming. In fact, the government has reneged on its election promise. That promise was unequivocal: both these ships were to be built in Australia with Australian labour. One might ask, then: what happened between the decision to tender in Australia for the three AWDs and the decision for these two heavy lift ships? As a warning shot to Australian industry to get serious on pricing, it may be a legitimate ploy. But let us hope it is only that. We as a nation have to take shipbuilding seriously. We need to recognise that, competitively, we will struggle with the gross construction task. That is of course simply a feature of relative cost structures around the world.

But where we can be competitive, to balance the issue, is in the value added components. The experience of the ASC in juggling competing technologies should be of great value. The learning curve of the submarines, while no doubt painful and expensive, should be an asset in this matter. We welcome these developments, and we will monitor them over time.