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Transcript of joint doorstop interview: Avalon: 26 February 2013: Avalon Airshow and Geelong; Air Force Capability; Vigilare; Joint Strike Fighter; KC-30; Newspoll

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Minister for Defence - Transcript - Joint Doorstop at Avalon

26 February 2013




TOPICS: Avalon Airshow and Geelong; Air Force Capability; Vigilare; Joint Strike Fighter; KC-30;


STEPHEN SMITH: Ok, well thanks very much for turning up. I’m very pleased to be here at Avalon

again with the Chief of Air Force, Geoff Brown and also with Richard Marles, our Parliamentary

Secretary for Foreign Affairs, but most importantly in Avalon’s context the Member for Corio and

the local Member for Avalon. Avalon is a great event for Geelong, a great event for Melbourne and

a great event for Australia. And it’s a terrific opportunity for Geoff as Chief of the Air Force to

invite guests from overseas and to engage in discussions and collaboration with his overseas

counterparts. And we welcome our overseas guests. It’s also the opportunity to reflect upon

projects for the future and also enhancements in capability that we’ve seen.

And of course in my opening remarks I drew attention to the significant enhancements that we’ve

seen in our airlift, whether it’s our heavy airlift, our C-17s are now a fleet of six, our C-130 fleet

now moving completely to a fleet of C-130s, or our tactical military air lift, our C-27s which we

expect to get in the next couple of years. I also indicated that Geoff has given initial operating

capability to our KC-30s, our multi-role transport tankers, our refuellers.

This gives us a significant enhancement that effectively will enable us when final operating

capability is given to see our C-130s for example, operate around the world. And the KC-30s have

their own air lift capability which is under-appreciated, some nearly 300 passengers and some 25

to 26 air containers. Geoff and I are also announcing today, and I’ll ask Geoff to make some

remarks in a moment, the final operating capability for Vigilare, our command and control air

system. But before I throw to Geoff, I might just ask Richard as the local Member to make some

remarks about the importance of Avalon to Geelong and the local economy. And then I’ll ask Geoff

to make some remarks about the KC-30s and Vigilare, and then we’re happy to respond to your



RICHARD MARLES: Thank you Stephen, and can I say what a pleasure it is to be here as - in this

capacity - the local Member - welcoming, not only you but in fact people from all round the world

to Avalon. This is no small event in terms of Australia’s global standing. This is one of the great air

shows of the world today. And happening every two years, it’s really the biggest single event

which happens in the Geelong region with that regularity. It’s expected that 200,000 people will

attend this event over the course of the week, which is fantastic. That’s fantastic as a public

event, but when look at the amount of trade that will be undertaken during the course of the few

days leading up to the weekend, this is a huge commercial event as well. And I think about

Chemring, which is a company just across the Melbourne road which provides the flares that you

sometimes see on the introduction to Lateline, coming out the back of a Hercules, I think. Those

are manufactured here locally - a defence industry which is contributing significantly to Australia’s

defence capability but doing a wonderful thing for the Geelong economy. So, welcome everyone to

this event. It is a great national event, but it is a wonderful local event, and it’s a fantastic event

for Geelong.

GEOFF BROWN: As you heard, the Minister announced the initial operational capability of the KC-30. For Air Force this is an incredibly important event because it now starts to give our Air Force

some global reach across the world. The aircraft recently took a detachment of F-18s up to Guam

to participate in an exercise called Cope North, which was with the US Air Force and the Japanese

Self-Defense Force. It successfully took the detachment up there. It refuelled aircraft while it was

on that detachment and brought the aeroplane back. It’s got an amazing capability not only from

air-to-air refuelling but also from its cargo carrying capacity as well. This year and this Avalon, in

lots of ways, we celebrate a fairly large recapitalisation of a lot of Air Force assets. The Minister

mentioned Vigilare capability, which is incredibly important to our overall defence force. It takes

about 245 inputs from 45 different systems and integrates it into one air pictures that takes us

across the whole of north of Australia. I think if you have a look at what we’ve achieved in Air

Force over the last couple of years, it’s really quite significant. We announced the IOC for

Wedgetail late last year, the final operational capabilities of the Super Hornet. So, I think

everybody can be quite proud of the Air Force and its contribution to the ADF.

STEPHEN SMITH: Okay, we’re happy to respond to your questions.

JOURNALIST: Minister do you have [indistinct] confidence in the Joint Strike Fighter after the last


STEPHEN SMITH: As I’ve said on a number of occasions, I’ve always been confident that in the

end the Joint Strike Fighter Project would get up - that it would be successful, and that’s because

the entire weight of the United States system is behind it. But I’ve also made this point crystal

clear that yes, there have been difficulties and delays in the project and one thing I won’t allow to

occur is any gap in our air combat capability.

And that same approach and attitude saw the arrival of 24 Super Hornets, which were given,

Geoff indicated, final operating capability status towards the end of last year. The decision to

purchase the 24 Super Hornets was, to his great credit, made by Brendan Nelson. That was

reaffirmed by Joel Fitzgibbon when he effected a review of air combat capability in 2008, when we

came to office in late 2007. So I’ve made it clear that I won’t allow a gap in our capability to

occur, and the gap in capability potential, of course, is there because of the ageing nature of our

Classic Hornet fleet. We’ve got 71 Classic Hornets, and the delays that we’ve seen in the Joint

Strike Fighter Project. We are contractually obligated to take two Joint Strike Fighters, which we

will take in the United States for training purposes in 2014 and 2015. We’ve indicated publicly that

we will then purchase another 12 to effectively give us our first squadron. We’ve made no decision

about the timing of that, we’ll make that decision in due course as we take this step-by-step.

In the meantime, last year, I asked Defence to do a comprehensive assessment of all of the

options and all of the risks. That came to me at the end of last year and at the end of last year I

announced publicly that we would make a decision in the course of this year, I expect the middle

of this year, about whether we need to make further decisions to avoid any gap in capability. As

part of that process we issued, under our foreign military sales arrangements with the United

States, a request for information for up to 24 additional Super Hornets.

No decisions have been made, no judgements have been made, we’ll make that decision in the

course of this year, I expect in the middle of this year. But one thing I won’t allow to occur will be

a gap in our air combat capability. With 71 Classics, and 24 Super Hornets, we clearly have an air

combat capability and superiority in our immediate region. And the other very significant

acquisition that we have made, in addition to the 24 Super Hornets, is to make sure that 12 of

those Super Hornets can be wired for the electronic warfare capability Growler, and last year I

announced that the Government had decided to purchase 12 Growler. That gives us a deeply

significant capability. I’ve also made the point that just as the United States Navy is now

effectively operating on a mixed fleet to 2030 or 2035, a mixed fleet of Super Hornets, Growlers

and Joint Strike Fighters- that potential is there for Australia as well.

Sorry, one here.

JOURNALIST: [Indistinct]

GEOFF BROWN: At the moment we’ve still got one aircraft in Spain, and it’s testing at the

moment. I’m hopeful by the end of the year that we will have sorted the issues with the boom and

we’ll start using the boom from early next year. So, once the boom is capable, we start using it,

we’ll go very close to FAC early next year.

JOURNALIST: Will you be using it primarily as a tanker, or a passenger transporter? You talked

about the number of seats it has, and it’s supposed to be a tanker?

GEOFF BROWN: Well the great thing about is if you look at taking fighters overseas or anything

like that, again you’ve got ground crew, the ability to take the ground crew, you can take a lot of

the cargo underneath. I see it as a flexible use asset, we’ll use it for both air lift and air to air


JOURNALIST: Would you be happy with a price tag of [indistinct]-

STEPHEN SMITH: Well look, I have seen, in recent times, various representatives who are

associated with the Joint Strike Fighter Project, putting out a particular figure. I think in terms of

schedule and in terms of cost, it’s in Australia’s national interest to take this step by step. So I’m

not relying upon any speculation, any assertions, any predictions, we’ll deal with the reality as and

when it comes.

JOURNALIST: Well if we’ve got 48 Super Hornets, we won’t need as many [indistinct]-

STEPHEN SMITH: Currently we have 24 Super Hornets, and I’ve asked and I’ve authorised the

issuing of a Letter of Request to get information about the purchase of up to potentially another

24 Super Hornets. No decision has been made, I originally said in the course of 2011, and last

year, that I thought we’d need to make a decision about any potential gap in our combat

capability by the end of last year. In the event, we didn’t need to do that, we do need, I think, to

make a decision by the middle of this year about any risk for gap in capability, and we’ll do that in

a methodical, exhaustive, due diligent way.

You had one for Geoff and then we’ll come over here.

JOURNALIST: [Indistinct]

GEOFF BROWN: You can keep an aeroplane for as long as you want. The problem is aircraft age is

you lose availability and reliability of the aircraft. So the important thing from my point of view as

Chief of Air Force is the Government realises the importance of the air combat capability, and

they’re looking at all the options as to how we maintain a robust air combat capability. Because,

from my point of view as Air Force, you know, we do four main things for the joint force

[indistinct] Government, we do our air lift capability, our ISR capability, strike and control of the

air. But that control of the air is probably the most important thing that we give to the rest of the

joint force.

JOURNALIST: Minister, can you confirm whether the Defence Force is planning to buy seven

surveillance drones, costing about $3 billion?

STEPHEN SMITH: Well no decision has been made in that respect, just to outline the history, we

currently have, in terms of unmanned aerial vehicles, we have Shadow and Heron which operates

in theatre in Afghanistan, and that works very well for us.

In terms of Australia as an island country, an island continent, and a maritime power, we want to

have, and we want to make sure, that we’ve got a capability to patrol and surveil our maritime

space. Currently we do that through manned aircraft, we do that through our Orions and we have

a fleet of about 18 Orions. And at this stage the judgement is that towards the end of this decade,

there will be a need to take the Orions out of service. So for some time, Defence has been

planning for the replacement of the Orions, both by manned aircraft and by unmanned aircraft.

And very serious study and consideration is being given to the potential for - on the manned side

of that replacement, before the Poseidon, the P-8 Poseidon to do that job.

And so far as unmanned surveillance is concerned, we need to have a capability in the unmanned

surveillance area which will deal with maritime surveillance. No decisions have been made on that

front, we are examining a range of options and in due course will make announcements about

those. For the present time, the unmanned aerial capacity that we have works for us very in

theatre in Afghanistan, but we need to have into the future, when the Orions come out of service,

an unmanned maritime capability, and that’s what we’re working on, but no decisions have been


JOURNALIST: Minister what’s one of your highlights for the air show this year? Can you give us an

overview of where you think the highlights have been?

STEPHEN SMITH: Well, if we were on an Air Force day rather than a Navy day, and it wasn’t wet,

we’d be doing this in front of a KC-30. And Geoff’s been asked about the KC-30 going to be used

as a tanker to refuel, or as lift? And Geoff is quite right, it’s going to be used as both. And when

you add the KC-30, its refuelling capability and its lift capability, and when you add that to all of

the other pieces of lift capability that we’ve acquired, and air combat capability that we’ve

acquired, you see a deeply significant air force capability, both for humanitarian assistance and

disaster relief purposes, both onshore and offshore, but also for combat and military purposes. So

we’ve got, now, six C-17s, last time we were here we had four. Our C-130 fleet, the Js have

entirely replaced the Hs. We’ve got a dozen C-130Js. And we will have, over the next couple of

years a replacement for our military tactical air lift, the C-27s. When you add the KC-30s to that,

and the capacity when the KC-30s go to final operating capability, they’ll be able to refuel C-17s,

Super Hornets and, in due course, when they arrive, Joint Strike Fighters.

In terms of lift, that gives you the capacity for a C-17 to effectively go around the world. For the

Super Hornets, it means you can refuel the Super Hornets, so it gives you both a power

projection, but also a heavy lift projection. And that sets Air Force up for a very bright future. So,

on the Air Force side of the show, I’m very pleased with the capability and the acquisition that we

have picked up over the last couple of years.

And I mentioned Growler, in addition to the 24 Super Hornets, in addition to Joint Strike Fighter’s

down the track, Geoff has said, in his view, that the acquisition of the Growler air warfare

capability - electronic air warfare capability, is the most significant acquisition that we’ve seen for

some considerable time. I think Geoff has said since the F-111, I agree with that. That is a deeply

significant acquisition, and that will work well, both obviously with the Super Hornets, but also in

due course with Joint Strike Fighters.

JOURNALIST: Minister, how significant is this event on an international level?

STEPHEN SMITH: Well, as Richard has said it’s a great event for Geelong, a great event for

Melbourne, but it’s also a great event for Australia. It brings to Australia a large number of

overseas and international guests, Geoff’s counterparts, but also significant players and figures in

the defence industry and the aviation industry. And it’s a very good opportunity for Geoff, for the

Defence Materiel Organisation, for Australia’s defence industry to collaborate and work closely

with those overseas guests. Our Air Force capability, our defence capability generally, is a mix of

domestic production and overseas buy, so it’s a very good opportunity for Australian industry, and

Australian Air Force to collaborate with their counterparts from overseas.

JOURNALIST: Just on a different note, just if I could get your reaction to the latest Newspoll


STEPHEN SMITH: I’ve been saying for some time that when we get to the election, which is some

six or seven months away, that it will be a competition, it’ll be close, and I said recently, when the

Australian public get to see the whites of Tony Abbott’s eyes, they will start to worry about the

risk he poses as Prime Minister. I don’t think he has the demeanour or the judgement to make the

national security decisions or the national economic interest decisions. There’s been a series of

polls, there’s no point saying they haven’t been tough polls for Labor, but the election will be in

September, and I’ve always been of the view that when the election comes, it’ll be a tough, tight,

close election.

JOURNALIST: The Australian people [indistinct] in the latest polls, that Tony Abbott’s a better

person to run the country-

STEPHEN SMITH: Well we’ve seen over the recent period the Prime Minister having a better

preferred Prime Minister status and we now see the results today. In the end, the community will

make their judgement, their decision, in the middle of September. And I remain of the view that

I’ve expressed for all of this Parliament, that I thought this Parliament would go full term, that’s

proven to be correct, and I think in the end it’ll be a tough, tight, close election.

JOURNALIST: What about the unmanned combat [indistinct] - are you confident Australia is

playing a part in that, and that we’ve got a future in that, and do you see a future where we won’t

have pilots in fighters?

GEOFF BROWN: I think you’ve got to look at what the advantages are of unmanned aircraft, and

the real advantage is that they can sustain, over the battlefield for long periods of time. When we

look at surveillance, surveillance is a real task for us, given not only Northern Australia, but down

towards the Antarctic, so a long-range UAV really suits in those sort of circumstances. I think

some people, when you have a look at the Afghanistan [inaudible]

STEPHEN SMITH: Currently, as Geoff and I previously indicated, we’ve got some tactical

unmanned aerial vehicles in Afghanistan, they’re not armed. I am not against Australia giving

serious consideration down the track, in the future, to not just unmanned aerial vehicles that give

us a greater capacity for intelligence and surveillance in our maritime space.

I am not opposed to the notion of giving consideration down the track to armed, unmanned, aerial

vehicles. And, as Geoff- as the Chief of Air Force has said, this is not something that will

completely dominate the future, but it is an option, it is currently utilised by a small number of

countries, I am not averse to it, we are not rushing to judgement. This is one of the things which

we are giving consideration to in the overall context of the replacement of our manned

surveillance aircraft with a mix of manned surveillance aircraft, and unmanned.

So, as a philosophical point of view, I’m not opposed to the notion of unmanned aerial vehicles

carrying weapons, we don’t have them at the moment, there are no proposals at the moment, but

this is a conversation which in due course, both defence and Australia needs to have.

Now- so there is one here and then we’re coming back here.

JOURNALIST: Are you concerned the Australian defence industry [indistinct]?

STEPHEN SMITH: Well, as a general proposition, if you look at the mix of opportunities for

Australian industry, there’s always a mix of capability, which is purchased overseas off the shelf,

and capability which is developed here. The historical average of that mix is about, I’m told, about

54-55 per cent. So historically, 54-55 per cent local. So, in other words, about 55 per cent of the

defence budget is a local investment. This year, this financial year, the CEO of the DMO, so

Warren King tells me that he’s expecting this financial year, that’ll be 59 per cent domestic

investment. Both defence industry and the world’s economy have gone through a tough time. We

don’t call it the global financial crisis for nothing. And you may have seen the organisers indicating

that as a consequence of that we’ve seen a slight reduction in the attendance here. But, I’ve

made this point before, I run a national security policy, so I need national security assets. I don’t

run a local industry policy, but there are sections of our industry which are important national

security and national strategic assets. Ship building is one, aviation, and matters air are another.

But it will always be a mix, and the current investment, domestically into defence industry is

about $4.7 billion per annum. So it’s somewhere between four and a half and five billion. This is a

significant investment. But there’s no doubt in some areas, people have had pressures and that is

almost invariably a result of the global financial crisis, or the fiscal circumstances that US

Secretary of Defense Panetta refers to, which I agree with, the new fiscal reality.

JOURNALIST: Along those lines-

STEPHEN SMITH: Go here first, he’s been trying.

JOURNALIST: Do you consider the Classic Hornet, regardless of the structural integrities, will be a

viable air combat fighter in the next decade? And if not, we were told Super Hornets will be


STEPHEN SMITH: Look, at the moment again, we’re going through this discussion. The Classic

Hornet has gone through a Hornet upgrade program over the last ten years. Right at this point in

time it is a very capable fighter. The judgements you need to make is, as you look into the future,

is to what the region comes up with - with other aeroplanes, what sort of developments there are.

But there is a finite life on the Classic Hornet. And again, it’s just not the structural integrity, it’s

the systems and it’s the difficulty of operating old aeroplanes. And that’s the set of [indistinct]

we’ve got before Government at the moment.

GEOFF BROWN: And I’ll just add to - just to remind people that the Australian National Audit

Office did a study of the maintenance program into the Classic Hornets, we’ve had a substantial

maintenance and sustenance program. That got a very significant tick from the National Audit

Office. Currently of course the Classic itself gives us an air combat superiority in our immediate

region, but in due course we need to upgrade, and that’s why I’ve made the point that the

potential gap between the classics and the arrival of the Joint Strike Fighters is reason for us to do

what we’re doing. Which is very serious deliberative consideration of making sure we don’t have a

gap in that air combat capability.

JOURNALIST: [Indistinct]

STEPHEN SMITH: We’ll I’ll go first, and then Geoff can go second. All of those studies that you’ve

been referring to, Australia has been doing since 2008. When we came to office in December 2007

one of the first things that my predecessor - or one of my predecessors, Joel Fitzgibbon, did, was

to effect a review of our air combat capability. That came to the conclusion that we should

persevere and continue with the purchase of the 24 Super Hornets that Brendan Nelson had

ordered, and that we should continue with the Joint Strike Fighter project. We also made the

decision at that time that of those 24 Super Hornets, 12 should be wired up for Growler. And

when I became Minister I made sure that that potential remained in place. I also made sure last

year that we actually decided to purchase 12 Growlers. I also last year - with the further delays in

the Joint Strike Fighter project asked the Defence to effect another review because I wanted to

ensure that there was no gap in capability. And what that review has thrown up is the classics are

doing well, but there is a limit - as Geoff and I have both said, there is a limit both to keeping

them in the air and their capability. The Super Hornets are a very effective air combat capability

plane for us, and they carry with them Growler, which is deeply significant. So what other

countries have been doing, we’ve been doing that effectively since 2008, and we’re not proposing

to change course now. We are, as I’ve said, step-by-step, advisedly making decisions as we need

to. I remain confident that the Joint Strike Fighter will get up. The risks to the Joint Strike Fighter

continue to be schedule and cost.

GEOFF BROWN: It’s a good point you make, but I think you need to remember that our Classic

Hornets were bought between 1985 and 1990. The majority of the US Navy fleet that was built

around that time has already been retired. So the aircraft you’re referring to were probably built

about ten years later as the ones that are actually looking at upgrading. Upgrading aircraft is a

hugely complex task, and one of the issues with doing it is that you actually take some of the fleet

out of service and they’re unavailable for your normal raise, train, sustain. So it’s a difficult thing

to manage, and I don’t believe there’s any point in upgrading our classics anymore, because there

just isn’t the return on investment.

STEPHEN SMITH: You’ve had a reasonable go, shall we call it a day? Thanks very much, enjoy the

show. Cheers.