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Xenophon calls for release of warship audit -

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ELIZABETH JACKSON: The first of the Navy's three new warships will be launched in Adelaide today.

But the ceremony has been overshadowed by a Government audit which has found that the warships have overrun the budget by more than $1 billion.

Independent Senator Nick Xenophon says he'll be pushing for a Senate resolution for the audit report to be released.

He says he thinks the Government doesn't want it made public because it will be critical of the Defence Department.

From Adelaide, here's Natalie Whiting.

NATALIE WHITING: A bottle of champagne will be smashed against the first ship built as part of the Air Warfare Destroyer program this morning to mark its official launch.

Thousands of people will be attending a ceremony in Adelaide to celebrate as the ship hits the water for the first time.

Steve Marsh is the manager of Ship One.

STEVE MARSH: It's the culmination of many years of hard work with our building our teams, getting the guys ready, building the facilities, training everybody and bringing it all together for this one point in time when we launch and show the world what we can do.

NATALIE WHITING: But the celebration has come under a shadow.

A Government audit released yesterday revealed the project to build three Air Warfare Destroyers is running $1.2 billion over budget and more than two years behind schedule.

South Australian independent Senator Nick Xenophon says it was an "act of bastardry" that the report was released on the eve of the launch.

NICK XENOPHON: Making complaints about the AWD process, running it down, complaining of cost overruns when it seems that a significant reason for any of the cost overruns, in the order of 10 to 15 per cent, were as a direct and substantial result of problems within Defence and the DMO.

NATALIE WHITING: Regardless of the cause of the cost overruns, the Finance Minister has said, you know, we can't stick our head in the sand; we need to address the issues and find a way forward. Isn't that a fair enough position?

NICK XENOPHON: Look, of course it is. But what we also need to have is a bit of transparency here.

NATALIE WHITING: The Government is refusing to release the full audit because of commercial sensitivities. But Senator Xenophon says he'll be pushing for a Senate resolution for the report to be made public.

NICK XENOPHON: If the Finance Minister is fair dinkum about what he's calling for, then he can start by releasing these reports.

This argument of "commercial in confidence" doesn't wash anymore with the AWD project, given that so many other commercial partners have been brought in on the process and, by necessity, information had to be shared.

NATALIE WHITING: He says the secrecy is unacceptable.

NICK XENOPHON: I suspect that both the Defence Department and the DMO would be embarrassed if these reports were released.

We can learn from the mistakes of the past, but we can't learn if the Government is hiding these reports that obviously are also very critical of Defence and the DMO.

ELIZABETH JACKSON: That's Senator Nick Xenophon ending that report from Natalie Whiting in Adelaide.