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Monday, 4 May 1987
Page: 2547

Mr PRICE(9.40) —Some might argue that the honourable member for Mayo (Mr Downer) is very expert on defence matters, given his witnessing HMS Pinafore on a number of occasions. I rise in the debate on the defence White Paper not so much to speak on matters directly in the White Paper but to offer some personal observations about defence procurement, particularly about automatic data processing matters. In the 254th report of the Joint Committee on Public Accounts we tabled a report about Project DESINE-Defence EDP Systems Integrated Network Environment-and the Minister for Defence (Mr Beazley) responded to that at a later date. I wish to make a few observations about his statement, which was brief in the extreme. I was disappointed by its lack of detail and about his failure to comment on the Committee's report in that statement.

Project DESINE, which involves three quite separate proposals, is a decentralisation and standardisation strategy for administrative computing systems in the Department of Defence. The first proposal involves purchases of supply and manpower systems redevelopment equipment worth about $60m. A separate procurement for office computing of about $6m is proposed. It is fair enough to say that the Minister has accepted some of the recommendations. In his statement he said that the Committee had recommended that the computer requirements of the Office of Defence Production should be tendered for separately from those of the rest of the Department. He said:

This is accepted and action is in hand.

I must say that I am pleased to see that he accepted that recommendation. He went on:

It is also recommended that a separate contract for small systems be not proceeded with. That recommendation too is accepted.

I should point out the reasons why the Committee suggested that this should not be proceeded with. That Defence Department proposal constituted a sop to Australian industry. I am sure my learned colleague, the honourable member for Hinkler (Mr Conquest), who was a very active member of the Public Accounts Committee, would agree with me. It was very disappointing when the Minister suggested that he would accept the recommendation but did not go on to elaborate the detail of it. I am pleased to see, however, that he recognised the veracity of the Committee's decision in that respect. He went on to say that he accepted the concern for providing Australian industry with opportunities and that he accepted the recommendation-that the prime contractor for Project DESINE could be an Australian company.

I note that when the computer Press was writing up the tender for the new Parliament House computer contracts, it heralded as a major breakthrough the fact that for the first time an Australian company was to be the prime contractor. That project was worth some $25m. I am sure the House will understand that this defence contract is worth considerably more and I certainly hope that in the tendering process an Australian company is given that opportunity.

Perhaps the most major aspect of the Committee's recommendations was that the tenders for DESINE should be staged. This recommendation was rejected. I regret that in the Minister's statement he suggested no reason why that recommendation should be rejected. However, he pointed to a concern that he shared with the Committee about Australian industry participation and suggested that, within the liaison between himself, the Minister for Industry, Technology and Commerce (Senator Button) and the Minister for Local Government and Administrative Services (Mr Uren), these concerns could be met.

The Committee's recommendation was made for a couple of reasons. First, it is true that there is a slight degree of risk in the way the Department is approaching this contract. I concede that it is a minimal risk, but the Committee was concerned about it. If one looks at the history of defence computing in the 1960s one sees that the Defence Department selected FACT as a fact compiler. At the time it was a very good technical choice, but tragically COBOL became the more widely used program. The Department of Defence was stuck with maintaining a system which had little use and a very small user data base. Consequently, it was prohibitive. The Committee's recommendation about staging addressed the issue of risk and the issue of Defence Department history. Secondly, it was felt that, by staging the project and proving up the system, we could minimise the risk and dramatically increase the possibilities of Australian industry participation in the hardware particularly as well as in software, terminals and other such equipment. Given the fact that the Government, through the Minister for Industry, Technology and Commerce, will shortly bring down a paper on the information industry, the fact that the Public Accounts Committee itself has brought down a significant report about offsets and the fact that the Government is looking at government purchasing through the Inglis committee which, incidentally, seems to have picked up the thrust of our Committee's report and has recommended a more generalised approach to two-stage tendering, it is a pity that the Minister's statement is so brief. I am sure that other members would agree with me. I want to allay the fears of honourable members and those of members of the Committee who may share my concern by pointing out that the Committee will have an opportunity to respond formally to the Minister's statement. (Quorum formed).

I thank the honourable member for Indi (Mr Ewen Cameron) for providing such a distinguished audience of my colleagues and peers. I was advising the House that, at a time when the Government is about to release a paper on the information industry, when the Government has received a report on the Inglis inquiry that is looking at high technology purchases by the Government and when, indeed, the Public Accounts Committee has presented a report on offsets, I find it disappointing that the Minister has rejected, with so little explanation, a major recommendation of the Committee. It clearly affects Australian industry and its ability to compete successfully for this tender. I was saying to the House that when the opportunity arises we will respond to the statement made by the Minister and the Government's response to our report. I look forward to that opportunity. I look forward to discussing with the Minister's officers from the Defence Department some of the reasoning behind the statement that has been made and to obtaining in evidence further information to assist the Committee to come to agreement with the Minister in his rejection of the recommendation. I certainly thank the House for the opportunity to make these personal comments. I congratulate the Minister for Defence on his successful handling of his portfolio. I am sure that, when we look at the overall sweep and breadth of the Minister's contribution to our nation's future and its defence, he will be remembered as being one of the most successful Labor Defence Ministers that this country has ever had.