(1)   With reference to the transcript of evidence of Rear Admiral Ruting to the estimates hearing of the Foreign Affairs, Defence and Trade Committee of 30 May 2007:

(a)   what are the precise terms of the new instruction issued after the Board of Inquiry (BOI) report into the fire on HMAS Westralia in May 1998, requiring ship repair contractors to sub-contact work only to Original Equipment Manufacturers (OEM’s); and

(b)   what was the wording of those instructions prior to the fire.

(2)   In response to a Freedom of Information request by Dahlmann Burke, lawyers on behalf of Bailey’s Diesel Services on this same matter, did the information provided quote the instruction in paragraph 1(a) as ‘Department of Defence policy which provides that all work relating to fuel system components must be performed by Original Equipment Manufacturers (“OEM”) or their Australian agent’ and ‘The contractor agrees that the Original Equipment Manufacturer (OEM) or his Australasian agent shall issue a Conformance Certificate for all work and components relating to Internal Combustion Engine (ICE) Fuel Systems’; if so, does this mean:

(a)   that OEM assurance to be sought from the OEM for all repairs and parts includes the specific OEM of fuel pumps, regardless of company ownership, and

(b)   that the Navy is absolved from responsibility for non-complying work endangering the safety of its ships.

(3)   In a response to the Western Australian Coroner’s recommendations, did the department, as reported at page 114 of the Coroner’s Report, say that ‘The Commonwealth was not a party to the contract between ADI and Enzed. The Commonwealth was not in a position to know that the wrong hose had been specified in that contract. It was ADI’s responsibility to monitor the work of its sub-contractors’; if so,

(a)   does it accept the Coroner’s view that ‘the fact that no one in the Navy had any knowledge of which type of hoses had been contracted for even after they were installed demonstrated a gross lack of supervision of the contract’; and

(b)   does this contracting practice continue today.

(4)   Were the engines on the HMAS Westralia at the time of the fire in May 1998 Pielstick engines made by SEMT, now owned by MAN, and were the fuel injector pumps made by L’Orange, a separate company, but also subsequently taken over by MAN; if so, would the new instructions to obtain OEM assurance for all repairs to injection fuel pumps require assurance from only MAN or its registered agent as an OEM for the engines, or does it also require separate assurance from the manufacturer of injector fuel pumps L’Orange or its certified agents.

(5)   Can the Minister advise:

(a)   which companies, in 1997 and 1998, were the registered agents of L’Orange in Australia;

(b)   who are they now; and

(c)   which repair companies have been contracted to maintain Navy L’Orange fuel pumps since 1998.

(6)   Noting that the Navy uses a panel of four ship repairers for engine maintenance work, as referred to by Rear Admiral Ruting on 30 May 2007:

(a)   what certification does each company have as certified repairers of all the OEM’s of all diesel engine types in RAN ships and, in each case, what OEM certification is held by each sub-contractor used by those companies in the maintenance of all Navy diesel injection pumps; and

(b)   does the Navy hold a register of those certified sub-contractors; if not, why not; if so, what are the names of the certified sub-contractors on that list.

(7)   Can the Minister confirm that the current instructions requiring the Navy’s diesel engine repairers to be certified, places total responsibility for the OEM certification of engine maintenance sub-contractors’ work on the ship repairer contracted to do the work; if so, what checks does the Navy take to ensure that:

(a)   such sub-contractors are in fact certified by the OEM as repairers of their product; and

(b)   only genuine OEM approved replacement parts are used.

(8)   What is the most recent Navy ship to have fuel injection pumps removed for maintenance, and:

(a)   who was the contracted repairer;

(b)   what subcontractor(s) were used;

(c)   what type of engine was fitted to that ship, who manufactured it, and what brand of injector pump was fitted; and

(d)   what evidence was sought by the Navy:

(i)   that the sub-contractors were certified by the OEM of the fuel injector pumps fitted to that ship, and

(ii)   that only OEM approved replacement parts were used.

(9) (a)   What guarantee and warranty is required of:

(i)   engine repairers and

(ii)   fuel injection maintenance sub-contractors, for maintenance work done to Navy diesel engines; and

(b)   how many times in the past 3 years have the provisions of those been exercised for the rectification of unsatisfactory work, and in respect of:

(i)   which ships,

(ii)   which principal contractors, and

(iii)   which sub-contractors.

(1)  

(a)   The procedure issued in October 1998 does not require ship repair contractors to sub-contract work only to Original Equipment Manufacturers. The precise terms of the procedure stated: “1. All work appertaining to Internal Combustion Engine (ICE) Fuel System Components will require a Conformance Certificate to be issued by the original equipment manufacturer (OEM) or his Australasian Agent. 2. All future contracts appertaining to work on ICE Fuel systems will contain a clause specifying this requirement as a contractual obligation. 3. OAEA is currently endeavouring to ensure that the Naval Stores System repair authorities adopt these requirements similarly.” Clarification on the use of OEM parts was issued in September 2000 following the release in February 1999 of Defence Instruction (Navy) LOG 47-3 Regulation of Technical Integrity of Australian Defence Force maritime materiel. The clarification was precisely as follows: “The regulatory framework does not mandate OEM parts. The use of non-OEM parts is acceptable provided that: a. Form, fit and function is maintained: b. System design integrity is not compromised; c. The supplier or design assurer is competent in the associated design issues of the system; d. The supplier or design assurer assures that the design integration of the non-OEM part into the system is safe and fit for intended function and intended environment; and e. Configuration control of the system, documentation and design is fully maintained.”

(b)   There was no equivalent to the Navy Technical Regulatory System prior to the Board of Inquiry. Quality verification appeared in the work orders and contracts as (in the case for HMAS Westralia): “6.1 Quality System

(2)   Defence has no record of an application from Dahlmann Burke, lawyers. Phillips Fox lodged a Freedom of Information (FOI) application with Defence on 19 January 1999 following an earlier representation to the Minister for Defence in December 1998. The first quotation cited was not provided by Defence but comes from the letter written to the Minister for Defence by Phillips Fox in December 1998 and is a misrepresentation of advice provided by the Ordering Authority Eastern Australia in a letter to Baileys Diesel Services dated 27 October 1998. The second quotation is from the information provided by Defence in response to the Phillips Fox FOI application. It is part of a clause which was to be included by the Ordering Authority Eastern Australia in “all Requests for Tenders and contracts”.

(3)   Defence is not aware of any recommendation by the Western Australian State Coroner as suggested in this question.

(a)   So far as Defence is aware, the Naval Board of Inquiry did not find any contractual arrangement between ADI Limited and Enzed that specified the type of hose.

(b)   Contracting practices are subject today to the oversight of the Defence Materiel Organisation (DMO) System Program Offices operating as Authorised Engineering Organisations in accordance with Defence Instruction (Navy) LOG 47-3 Regulation of Technical Integrity of Australian Defence Force maritime materiel, Amendment Number 1, a copy of which has been provided to Senator Faulkner. This continues the practice in the September 2000 clarification described in part (1) (a) above.

(4)   The HMAS Westralia main engine is a Crossley Pielstick not a SEMT Pielstick. SEMT was the French designer who licenced production of the engine to others, including Crossley. Crossley is now part of Rolls Royce. The Westralia engines were fitted with a mix of L’Orange and Duap fuel injection pumps. As to the effect of the new instructions, see part (1) (a) above.

(5)  

(a)   The complete list of registered agents for L’Orange in Australia in 1997 and 1998 is not known. Premier Fuel Injection Services, service agents for L’Orange injection pumps, has advised that, until 2001, the Melbourne company Peacock and Smith was the Australian agent. L’Orange was then purchased by MTU and L’Orange was absorbed within the MTU network.

(b)   Apart from the MTU network, L’Orange currently has two specifically named Australian agents / distributors: Peacock and Smith and Baileys Diesel Services.

(c)   Since 1998, main engine fuel injection pumps have been serviced largely by their respective main engine OEMs.

(6)   The four companies pre-qualified to tender as the prime contractor for major surface ship repair and refit contracts may perform engine maintenance in their own right or subcontract the work on a commercial basis, subject to the conditions of the contract. The contract statement of work and/or the work instructions associated with particular tasks articulate the certification and/or competence of personnel and organisation / companies completing the activity. In many instances, the repairer will be specified as the OEM or their in-country agent.

(a)   There is no certification proviso as implied by the question. The nature of the Ship Repair Contract is such that, where OEMs or authorised agents are required, then these requirements will be stated in either the Request For Tender statement of work or within the particular work instructions for a particular task. During tender evaluations, the tenderer and sub-contractor will be checked for compliance with the certification requirements. Where doubt exists, the prime contractor is required to demonstrate conformance with the requirement.

(b)   No. Where support services for ships are covered by In Service Support Contracts, there will be an attachment to the contract that contains a Schedule of Approved Subcontractors and this can only be amended by a Contract Change. Each System Program Office will have knowledge of approved subcontractors for specific tasks where this is warranted.

(7)   No. There is no certification proviso as implied by the question. Compliance with the requirements of the Naval Technical Regulatory Framework is mandatory for ADF maritime materiel. This is assured by having competent and authorised personnel working to approved standards using approved processes and working within an authorised engineering organisation and whose work is certified as correct. DMO assesses suppliers and requires objective quality evidence to support any claims in relation to accreditation / authorisation and OEM status.

(a)   There is no certification proviso as implied by the question, but, within DMO, System Program Offices undertake checks and reviews of their service providers as part of their compliance checks. The System Program Offices are further audited by the Navy for compliance against the Naval Technical Regulatory Framework to ensure their compliance.

(b)   It is not obligatory that OEM replacement parts are used in every instance. The use of non-OEM parts is acceptable provided that: a. Form, fit and function is maintained: b. System design integrity is not compromised; c. The supplier or design assurer is competent in the associated design issues of the system; d. The supplier or design assurer assures that the design integration of the non-OEM part into the system is safe and fit for intended function and intended environment; and e. Configuration control of the system, documentation and design is fully maintained. Conformance certification is required.

(8)   The most recent removal of Navy fuel injection pumps was for the Pacific Patrol Boats in July 2007.

(a)   Hastings Deering - Rockhampton.

(b)   No subcontractor was used. Hastings Deering is a recognised representative of Caterpillar, the OEM for the diesel engines and generators.

(c)   The Pacific Patrol Boats use Caterpillar diesel engines (Type 3516), which use Unit type injectors and a fuel pump and governor combination (Part number 2W6178 fuel pump group).

(d)   See (b) above.

(9)  

(a)   The guarantee and warranty requirements for maintenance work vary depending on the type of contract. For example, the Caterpillar representative provides a warranty period of three months on labour and parts and three months on maintenance work on engines. In some instances, where longer term relationships are in place with In Service Support contractors, this warranty period many be extended to 12 months for parts and varying periods for workmanship.

(b)   Three claims relating to unsatisfactory maintenance or manufacturing defects have occurred in the last three years: an ANZAC frigate in respect to MTU, four Minehunter Coastal (MHC) ships in respect to Thales Australia and WARTSILA Australia, and a Minesweeper Auxiliary (MSA) ship in respect to Birdon Marine Pty Ltd and WARTSILA Australia.