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Thursday, 9 February 2012
Page: 705

Defence

(Question No. 1444)

Senator Humphries asked the Minister representing the Minister for Defence, upon notice, on 9 November 2011:

(1) What is the current status of the Force Structure Review, and has it formally commenced; if so, when did it commence and when will it be completed.

(2) What is the current status of the Force Posture Review.

(3) What is the current status of implementation of the recommendations of the Kinnaird and Mortimer reviews.

Senator Chris Evans: The Minister for Defence has provided the following answer to the honourable senator's question:

(1) In the 2009 Defence White Paper, the Government announced its intention to prepare new White Papers at intervals of no greater than five years. To ensure that the development of future White Papers is as comprehensive as possible, a strategic risk assessment, a force structure review, and an audit of the Defence budget are to be conducted in the year prior to any White Paper.

The Minister for Defence has announced the Government's intention to deliver a new White Paper in early 2014. In order to meet this timeline, Defence has commenced preparation for a force structure review, which will be conducted in 2012. The results of the review will be reported to Government by early 2013.

(2) The Force Posture Review Expert Panel, Dr Hawke and Mr Smith, are on track to provide me with a progress report in December 2011. The final report will be provided to Government in the first quarter of 2012. Government will respond once the report has been received and considered. It is too early to pre-empt the report's findings.

(3) One of the key elements of the Defence Procurement and Sustainment Review, conducted by Mr David Mortimer AO in 2008, was to consider progress in implementing the 2003 Kinnaird Review of Defence Procurement.

The Mortimer Review noted the success of the Kinnaird reforms and provided a detailed analysis of the implementation of those reforms which can be found at Annex B to the Mortimer Review report.

The majority of the Mortimer recommendations have been implemented. In particular the following key initiatives are in place:

processes to support consideration of off-the-shelf options with cost-benefit analysis for each project;

project directives to ensure that there is clear accountability for the delivery of capability as approved by Government;

the independent project performance office;

a stronger linkage between the capabilities sought and strategic priorities;

assurance to Government of the affordability of the Defence Capability Plan;

a strengthened mechanism for the CEO DMO to provide independent commercial advice to Government;

the DMO General Manager Commercial and his new Commercial Group;

programs with industry and State Governments to address skills shortages;

charters for the DMO managers of complex projects and products; and

greater DMO accountability for its use of resources and performance through direct appropriation to the DMO for its operating costs.

Ministers also noted in August 2011 that the Kinnaird and Mortimer reforms have improved the rigour applied to the capability development process. Ministers noted that there had been 20-25 per cent reduction in schedule slippage for those projects subject to the Kinnaird and Mortimer reforms as compared with earlier projects.