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Media Release

The Hon John Moore, MP

Minister for Defence

 

 

Government Supports Stronger Local Defence Industry

 

Wednesday, 2 June 1999

 

The Minister for Defence, John Moore, today said that the Federal Government is committed to the development of a su stainable local defence industry.

 

Mr Moore was speaking at a 600-strong audience of industry and defence officials after earlier announcing the establishment of a new peak Government advisory body, the Defence and Industry Advisory Council (DIAC).

 

“As Defence Minister. I want to see a competitive and innovative Australian defence industry with continuing access to the latest technology,” Mr Moore said.

 

“I would also like to see closer and more long-standing partnerships develop between Defence and key industries, as well as a more commercial approach to defence acquisition.

 

The Minister said that Australia is likely to see further consolidation of defence-related industry through mergers and acquisitions.

 

“It is in the Government’s longer term interests to support a process of consolidation that results in the creation of a smaller number of financially secure, prime contractors, who are better able to meet the demand for increasingly sophisticated systems.”

 

“We do, however, need to strike a balance between the development of critical mass to ensure sustainability, and the maintenance of a competitive environment.”

 

Mr Moore said that the Government’s Defence and Industry Strategic Policy Statement recognised the need to develop an appropriate partnership With industry to ensure that the Australian Defence Force acquires the capabilities identified as vital to Australia’s interests.

 

“Defence self-reliance means having a Defence policy and an industry policy working together to support Australian capability,” Mr Moore said.

 

“The Government is strongly committed to the challenge of rebuilding Defence capability because Australia’s strategic environment is becoming more demanding. The regional economic crisis has created an environment in which disputes could escalate more quickly.”

 

The Minister stressed that the Government also had begun reinvesting the savings from the Defence Reform Program into Defence capabilities.

 

“The Reform Program is on-track and the targeted savings will be achieved. By the end of 1998~99 the reforms will have achieved $280 million in ongoing, annual savings. That’s $30 million ahead of plan. These savings are expected to increase to $445 million per annum in 1999-2000 and to $866 million by the end of 2000-03. The DRP is working in Australia’s interests,”

 

Mr Moore said that the Government recognised the increasing demands and pressures on Defence and the potential for this to expand. He said that the newly announced DIAC was an initiative that would enhance Australia’s defence capability.

 

“One of the first priorities of the DIAC will be to formalise a strategic framework for the introduction of partnering across Defence.

 

Partnering is about a more integrated team approach, focused on shared risk and reward, relationships with longer time horizons, and transparency and communication. One aspect of partnering which I intend to pursue is the use of public/private partnerships through the use of Private Finance Initiatives.”

 

PFIs refer to the use of private sector finance to procure assets and infrastructure to provide services to the public sector.

 

The Minister said that a Steering Group has been formed within Defence to oversee a review into private financing initiatives.

 

“The Federal Government is committed to a strong, secure A ustralia. We also are committed to obtaining the greatest value possible from each Defence dollar spent.

 

“The result will be an Australian Defence Force that is sharper and more combat-focused, one that is better-quipped, more mobile, more capable and more operationally-ready,” Mr Moore said.

 

Copies of the Minister’s speech are available on the internet at www.aapmedianet.com.au (Current Releases)

or from the Minister’s office on 02 6277 7800.

 

 

al  1999-06-04  14:08