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After a raft of reports laying responsibility for poor naval shipbuilding outcomes at the foot of successive Governments and Defence: Government still blaming industry for its own mess



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For more information contact Jeremy Roberts on 0433 620 850 or Nick Xenophon on 0411 626 677

22 / 5 / 2015

After a raft of reports laying responsibility for poor naval shipbuilding outcomes at the foot of successive Governments and Defence:

GOVERNMENT STILL BLAMING INDUSTRY FOR ITS OWN MESS Independent Senator for South Australia, Nick Xenophon, today criticised the Federal Government after another strategic leak attempting to shift the blame for poor warship procurement to industry - flying the face of a string of auditors and independent expert reports in the past year.

Today’s front page story in The Australian refers to an internal Government report of a blowout in the cost of the Air Warfare Destroyer (AWD) and lays the blame at the feet of our ship builders.

But the apparently Government-leaked report is squarely contradicted by the findings of the Australian National Audit Office (ANAO), White-Winter report, and the RAND Corporation study of Australian warship procurement, which was released last month. These reports found that Government and Defence decision-making were largely to blame for poor outcomes, particularly for the AWD, while ship builder productivity was a secondary issue that also needed attention.

“This apparent Government leak to the media is the latest salvo in its war on our naval ship building capacity. Is the Government trying to destroy confidence in the sector, softening us up for an announcement that our future submarines will be built in Japan, breaking a key election promise?” said Nick.

“Today’s report would be laughable if it wasn’t so serious. This is about the future of a key sector responsible for thousands of jobs around the country. Instead of congratulating the Government-owned ASC workforce for delivering a first class ship from such a flawed, Defence-led AWD process, the Government plants a front page story ahead of the first AWD launch tomorrow, trying to bury our naval ship builders’ reputations. This is a disgrace.”

A Government-commissioned RAND Corporation report found the reasons for a cost premium for ship building in Australia were mostly the result of poor Government and Defence decision-making, namely, a stop-start flow of ship building contracts by Government, changes to designs imposed by Defence and Defence’s poor integration of ship designer, builder and suppliers into management structures for large projects, including the AWD.

Senator Xenophon called for a change of course from the Government. “What is needed is a plan for a sustainable future for naval shipbuilding. South Australia will see the loss of thousands of jobs in the next two years, from the ceasing of ship building contracts from the Government and the closure of car-making by Holden. Instead of a plan for employment growth in this state, we see the Government attack key employers and sectors,” said Nick.