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Thursday, 28 June 2018
Page: 4378

Senator KETTER (QueenslandDeputy Opposition Whip in the Senate) (16:09): I present the report of the Economics References Committee on the future of Australia's naval shipbuilding industry, together with the Hansard record of proceedings and documents presented to the committee. I move:

That the Senate take note of the report.

This is an inquiry that has been going since 25 June 2014. In the previous parliament, this committee tabled three reports on the future of Australia's shipbuilding industry. The committee's first and second reports dealt with the tender process for the Navy's new supply ships and the pre-tender process for the Future Submarines respectively. The third report reaffirmed the recommendations made in the earlier report and also made findings relevant to the wider topic of Australia's future shipbuilding industry, including a recommendation that particular matters be included in the government's Naval Shipbuilding Plan. In this final report, the committee builds on its earlier findings and recommendations and examines the national shipbuilding plan and recent procurement and policy announcements by the government.

I think it's fair to say that the committee remains concerned about the government's management of the Naval Shipbuilding Plan. We're concerned about minimal Australian shipbuilding industry participation in the Future Frigate program. The committee is concerned because the government's request for tender did not require the three short-listed foreign designers, in their proposals, to subcontract to Australian businesses. The committee is concerned about the Future Submarine program. We were disappointed to hear that the strategic partnership agreement between the Commonwealth and Naval Group Australia is still under negotiation and we're concerned that delays related to the Future Submarine program risk a sovereign capability gap. Also, in relation to the offshore patrol vessel program, the procurement process was managed very poorly. The government did not require the successful tenderer to partner with or subcontract to a local shipbuilder.

There's a need for long-term planning on a national basis in this industry. I think most of us would accept that there is a need for Australian sovereign capability. I do want to place on record that the committee was reminded of the tremendous capacity of Australian industry and Australian workers to contribute to the naval shipbuilding enterprise. We noted that the decision on the Future Frigates is imminent, and it is critical for the development of Australia's sovereign capability that Australian shipbuilders have a significant role in the building of the Future Frigates.

I just want to finish by thanking the secretariat for their hard work over that period of time. I also thank all those who assisted the inquiry, particularly those who made written submissions and attended the public hearings. I pay tribute to my colleague Senator Kim Carr and to his office for the important work that they've done in relation to this report.