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Funding Australia's defence.



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Media Release

 

Minister for Defence

The Hon Ian McLachlan AO MP

Parliament House

Canberra ACT 2600

Telephone: (06) 2777800

Facsimile: (06) 2734118

 

8 May 98

 

FUNDING AUSTRALIA’S DEFENCE

 

The Minister for Defence, Mr Ian McLachlan, today welcomed the rep ort by the Joint Standing Committee on Foreign Affairs, Defence and Trade on defence funding.

 

“The report, Funding Australia’s Defence , makes a major contribution to the defence debate”, Mr McLachlan said. ‘While we have not yet analysed the report in detail, I can say that it will certainly provide a useful input into the Government’s considerations.”

 

The report examines the funding pressures within the Defence Department and the impacts of those pressures on the continued effectiveness of the Australian Defence Force in the medium term. It recommends an increase in the real growth rate for Defence spending of between 1.5% and 2.5% annually over the five years following the 1998-99 financial year.

 

The Report also highlights the need for substantial additional expenditure to overcome block obsolescence of major equipments in the 2010-2015 period.

 

“We are very conscious of these pressures”, Mr McLachlan said. “Under the previous Government, Defence outlays fell from 2.6% of GDP to 1.8% - the lowest percentage of GDP since 1938.

 

“That is why the Howard Government committed itself to halt the decline and hold Defence outlays at the levels set out in the 1995-96 budget.

 

“And that is why soon after coming into Government, we set about ensuring the most efficient possible system of achieving our core business - the development of combat capability and combat readiness in our armed forces.

 

“This was the aim of the Defence Reform Program which will free up some $500m in one-time savings and, at maturity, deliver some $900m of recurrent annual savings which will be redirected to the sharp end of the ADF.

 

“We then produced a Strategic Review to guide capability development decisions and set priorities for our spending on investment.

 

“We have made the hard decisions to wring out savings and we have made a sober assessment of our strategic priorities that will guide how we re-invest these savings.

 

“In particular, we are conscious of the issue the report has identified of block obsolescence of ships, aircraft and land forces equipment that we will have to face in the early years of next century”.

 

The report will be now be considered by Government and a formal response will be provided to the Parliament.

 

For further information: Jim Bonner 0419 438 490