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Delivering Defence capability through our service people: speech to the Australian\nCommand and Staff Course, Australian Defence College.



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THE HON. GREG COMBET MP Minister for Defence Personnel, Materiel and Science

www.defence.gov.au

Thursday, 26 November 2009

DELIVERING DEFENCE CAPABILITY THROUGH OUR SERVICE PEOPLE

Speech by the Minister for Defence Personnel, Materiel and Science, the Hon Greg Combet AM MP to the Australian Command and Staff Course

Australian Defence College

Check against delivery

It is with great pleasure that I deliver this speech today to the future leaders of the Australian Defence Force, as well as many of your peers from other nations represented in this room. As you put all the lectures and assignments behind you and head towards your graduation, I am sure that you are all

looking forward to your new postings. For many of you, this will no doubt involve commanding personnel in difficult and dangerous situations. I am sure that the skills that you have acquired during the year will help you overcome

many of these challenges.

However, as I contemplate your futures today it reinforces to me that we in government ask and expect much from our Service personnel and their families. As Defence Personnel Minister my responsibility is to ensure that members of the ADF have conditions of employment that reflect the unique circumstances of your work. So today I intend to inform you of how this government will deliver the defence capability that Australia needs by investing in and supporting our Service personnel.

In our short history as a nation, Australia's service personnel have forged a formidable reputation throughout the world.

Places like Gallipoli, Passchendaele, Kokoda, Tobruk, Kapyong and Long Tan are all well known to Australians, and are part of the Army’s rich history. Similarly, the past achievements of the Navy including actions in the Coral Sea, Mediterranean, and Indian Ocean and the Air Force in the skies over Europe, the Middle East, Asia and the Pacific, combine to present a proud and rich heritage of which Australians can be justifiably proud.

In these, and other areas of conflict, our sailors, soldiers, airmen and airwomen have repeatedly demonstrated their fighting spirit, skill and courage in protecting Australia, our people and our values.

That work continues today.

Since 2005, we have deployed just over 45,000 people to a number of theatres across the world, including the Middle East, East Timor, Solomon Islands and Africa. Closer to home, border protection operations and assistance to the Australian community in times of need remain ongoing and the work of all three Services in this vital task has been outstanding.

Accordingly, our Service personnel have and continue to fulfil a variety of roles including conventional battle operations, peace-keeping, humanitarian assistance, border protection and anti-terrorism.

They continue to be very well supported by Defence's civilian workforce, whose men and women undertake a variety of crucial roles across the organisation.

The Workforce Challenge - What do we need?

I would like to start today by outlining the challenge we face to get the workforce we need.

Defence cannot expect to meet its mission of defending Australia and its national interests without a well-trained and modern workforce at its disposal.

The 2009 White Paper describes the security capability the Government expects Defence to provide.

To support the Government's future capability plan, the full time ADF will be required to grow to approximately 57,800 members and non-military members will grow to around 21,900 in the next decade.

The ADF strives to attract and retain the best people to ensure that we have the workforce needed to meet our goals. To meet this objective, the ADF has to compete in a competitive domestic and global labour market.

Our young people today are presented with many different employment options. Attracting them to join, and remain in, the ADF in such a competitive environment will be an ongoing challenge for both the Government and Defence.

A Compelling Employment Offer

If we are to do this successfully we must recognise the increasing expectations that workers have with respect to both their employment and their employer.

They want to be engaged by their work. They want greater control over their lives, and they want to be able to balance personal and family matters.

The Defence White Paper highlighted this and identified the need for Defence to re-mix its employment package into a compelling and competitive employment offer.

I am of the view that Defence must seek to promote the total ADF employment package if it wishes to maintain a competitive advantage.

This approach means that Defence should examine the employment life-cycle from when an ADF member joins to the day they retire and transition out of their service.

This would involve a comprehensive assessment of what attracts people to Defence, what conditions of service and remuneration should apply to retain them, what support services should be available to them and their families,

and what benefits are available once they retire.

Defence's workforce strategies should therefore be targeted at ensuring that every aspect of a member's working life is considered and addressed.

In other words, Defence will need to encompass remuneration, benefits, career and talent management, support to families, health, rehabilitation and compensation, and work-life balance as being integral to the Defence employment offer.

We have made some good progress in developing such an employment offer, but there are still many challenges ahead.

I would like to acknowledge the efforts of the Service Chiefs at this point who were tasked by the Prime Minister last year with improving recruitment and retention. Navy, Army and Air Force have all been extremely active in these areas achieving excellent results.

Current Workforce Trends

As I indicated previously, the Defence White Paper 2009 mandates that Defence will need to grow the full-time force to 57,800 over the next decade.

I am pleased to inform you today that we have already reached a full-time strength of over 57,100 personnel. This result far exceeds our expectations and is mainly attributable to a continuing decline in separation rates - which is testament to the success of a range of policies and strategies that have been put in place to retain people.

Early recruitment figures for this financial year are also encouraging.

This reflects the work that has been done by the Services and Defence Force Recruiting in providing information on the diversity of Defence Force careers,

while establishing a long term brand position for each Service and dispelling common misperceptions about Service life.

Given the importance that Defence places on attracting new recruits to meet its current and future workforce requirements, it is essential that it maintains a robust and viable recruiting capability.

Accordingly, I would like to reassure people about the state of current Defence Force Recruiting operations.

As the Government advised recently, Chandler MacLeod Group (CMG) sought for its own reasons to terminate the current Defence Force Recruiting Services contract which it signed with Defence in July last year.

Defence subsequently agreed to this termination, subject to certain conditions being met, and is now working with CMG to ensure the successful transition into new arrangements by February of next year.

Although the Government is disappointed by this development, I am confident that Defence Force Recruiting will continue to deliver a first-class recruiting service. Defence has a robust continuity plan in place and is currently progressing an alternative commercial arrangement. Importantly, all current applicants for enlistment and appointment are assured

that their applications will continue to be processed and that this current situation will not affect them joining the Navy, Army or Air Force.

Similarly, new applicants can continue to apply during this period. Defence is not turning any suitable applicants away whilst this transition takes place.

I am also greatly encouraged by the improvement in ab initio recruiting so far this financial year. This is a testament to the professionalism of all Defence Force Recruiting staff during a difficult time.

I will touch further on some of the other work that is occurring in recruitment shortly.

Retaining high quality personnel is another key component of Defence’s overall workforce improvement strategy and the focus for Defence is aimed at improving retention across the board.

Feedback from members via recent research indicates that, overall, perceptions of remuneration, conditions of service, job satisfaction and career management, are both positive and improving. This suggests that concerted effort over a number of years in the personnel arena by the Services to retain people have been well received.

ADF Separation rates have continued to decrease over the last 12-months. As at 1 October 2009, the ADF 12-month rolling separation rate of 8.1 per cent is over 2 per cent lower than 12 months ago. In fact, Mr Speaker, it is the lowest separation rate in the last 18 years for the ADF. However, we cannot

be complacent as separations are likely to increase in the future as the Australian economy grows.

There are, of course, still challenges within particular workgroups across the organisation but these are being addressed and progress is being made.

Generally, these shortages continue to mirror those of the wider Australian workforce. Doctors, engineers, maritime professionals and technical trade categories are particularly in short supply.

We have implemented strategies such as the Defence Technical Scholarships program to help overcome these shortfalls, and will continue to closely monitor these areas.

I have also recently commented on some the workforce challenges involved in manning the future submarine fleet.

As I have indicated the best way we can address the workforce challenge is to provide and demonstrate the compelling employment offer that the ADF is. To this end I now want to discuss some of the work we are doing across the personnel spectrum.

Remuneration

Firstly, I want to touch on remuneration. Although it is not the primary consideration for members joining the ADF, given the type of work that they do, our Service personnel rightly expect to be appropriately remunerated. And we have made good progress in this regard.

Recent Defence Attitude Survey results have revealed very positive trends and improving satisfaction with remuneration packages.

Recent initiatives in remuneration include new pay structures for all soldiers, sailors, airmen and airwomen that more appropriately recognise and reward rank and skill advancement.

Last year the Government began a $2.4 billion investment to modernise and competitively position over 196 trades and categories within ADF ranks.

Referred to as the Graded Other Ranks Pay Structure, over 37,000 non-commissioned members have been moved into a differentiated pay structure that competitively values their skills, experience and contribution to delivering ADF capability.

This new structure offers greater reward, through promotion, for developing command, leadership, and management skills and expertise.

In addition, the rates of pay for trainees have been improved and a new 'trainee allowance' has been introduced which will assist in attraction and retention of trainees.

Further work is also underway to simplify and restructure a wide range of ADF allowances.

Military Superannuation

The Government views military superannuation as a key component of the benefits provided to ADF members.

The Government undertook to release the Review of Military Superannuation Arrangements, the Podger Review, which was commenced by the previous government, and then conduct an extensive consultation process on this report.

We have done that and we continue to consider the report's recommendations, a task complicated by the recent Global Financial Crisis which has drawn into sharp relief the inherent problems of accumulation funds such as recommended by Podger.

However, we have also recently announced improvements to invalidity/death benefits provided under the Military Superannuation and Benefits Scheme.

The increase to Compulsory Retirement Age from 55 to 60 on 1 July 2007 means that a further five years of prospective service is used to calculate the invalidity benefits for those eligible members of the Military Superannuation and Benefits Scheme.

This potentially increases the overall invalidity benefit payable under the scheme.

These superannuation increases complement the support provided to injured members through rehabilitation and compensation.

The increase to Compulsory Retirement Age and recent pay increases also make the superannuation package for all members more attractive and provides incentives to remain part of the organisation.

The Health of our ADF Personnel

The Government is committed to ensuring that our ADF personnel have the very best support and health care services.

The ADF’s Joint Health Command is currently implementing a range of reforms to ensure that our personnel have a world class health service.

Two key reviews of Defence Health Services have occurred in the last 18 months. They are the Alexander Review into Healthcare in the Australian

Defence Force and the Dunt Review into Mental Health Care in the Australian Defence Force.

Along with that work has been ongoing in changing the way we go about rehabilitation and providing healthcare to ADF families.

I would now like to discuss some of these in more detail.

Healthcare

The Alexander Review recommendations address the provision of clinical care, increased operational health capability and improved opportunities for health care professionals across the ADF.

Of note, the review advocated the development and implementation of a comprehensive e-health system that will improve patient care by ensuring health practitioners have access to all the relevant information for an individual.

This system will be in-line with the recently announced “National e-Health Strategy” and will provide significant benefits for ADF members given their frequent movements due to postings.

Mental Health

Mental health is a key element in a serving member’s overall health status and, in recognition of this, a review was undertaken into “Mental Health in the ADF and transition through Discharge” by Professor David Dunt of the University of Melbourne.

That report and its recommendations were released on 1st May 2009. The Government has accepted or partially accepted all of the recommendations of this report and implementation of these initiatives has already commenced.

To ensure that the recommendations are progressed urgently, funding of $83 million has been allocated over the next four years.

This includes significant work being done in enhancing the mental health workforce, with a focus on regional area support.

The Dunt review recommended increased engagement with Defence member’s families. Discussions are currently being held with Defence groups to determine the best process to ensure families are included in the mental

health care of ADF members.

ADF Rehabilitation Program

In addition to the work being undertaken in healthcare and mental health, Joint Health Command has continued to expand and refine the ADF Rehabilitation program.

Since its inception, this program has decreased the number of medical discharges through retraining of staff for alternative duties within the ADF.

I am pleased to advise that this program had a return to work rate during the 2008-09 financial year of 87 per cent which is above the national average.

In early 2009, streamlined procedures and a risk management process were introduced for health staff and rehabilitation providers and this is proving to be a successful strategy.

ADF Family Health Care Trials

In conjunction with these reform programs for serving Defence personnel, the Government also made a commitment to extend free basic medical and dental care to the spouses and children of ADF personnel.

The ADF Family Health Care Trial forms part of the Government’s recruitment and retention strategy for Defence. The trial to deliver basic health care to the dependants of Military personnel has been introduced in two stages and caters to approximately 22 per cent of the ADF dependant population.

Stage one commenced on 1 May 2009 in the Katherine, Cairns, Sale, Singleton and Pilbara regions. Stage two commenced on 1st October this year and includes 13, 300 dependants in Townsville, Darwin and Puckapunyal.

I can advise that approximately 2500 dependants are currently participating in the trial, and this figure continues to increase daily.

The number of participating Medical practitioners is currently 238 across all regions.

Testing for Cadmium Exposure

Apart from these initiatives, the ADF also strives to provide a safe and healthy workplace and to respond quickly to any health related concerns.

Recently, when it was discovered that there was a risk that our ADF personnel could have been exposed to dangerous levels of cadmium aboard the Collins Class submarines, the Government acted immediately to ensure the health and safety of our ADF personnel was not compromised.

All 6 submarines were tested for airborne contamination. This testing revealed that airborne cadmium levels within the Collins Class Submarines are well below the Australian Standard and at a safe level.

All 6 submarines were also tested for surface contamination. Testing revealed that cadmium surface contamination does exist in proximity to some cadmium components on the submarines.

I have been advised that the cadmium surface contamination poses little threat and the necessary hygiene and safety procedures have been reinforced.

However, to ensure the safety of both submariners and maintenance workers, all 6 submarines have now been cleaned.

The Government’s primary concern throughout has been to protect the health of our sailors and maintenance workforce.

I can also advise that ASC has tested 52 of their personnel for elevated cadmium levels with all results below Australian defined standards.

The ADF has run an information campaign for personnel informing and educating them about cadmium exposure.

This information also informed personnel about the availability of screening for anyone who was concerned about exposure.

I understand that so far no results from this screening have been received above the Australian defined standards.

Voluntary testing still remains open for any submariner who may wish to undergo this practice.

I would like to conclude on health by responding to recent media reports suggesting that members of the ADF are using illicit drugs while deployed on tours of duty in Afghanistan and returning home addicted.

The Chief of the Defence Force responded to these allegations on 22 November. He confirmed that what was reported in the media is baseless. The ADF has conducted Prohibited Substance Testing in Afghanistan since 2005 and all test results for deployed ADF members have been negative.

I am advised that overall more than 35,000 tests have been conducted between 16 June 2005 and 31 August 2009, involving the random and targeted testing of ADF members both in Australia and while on operations. The average rate of positive tests over that period was 1.54 per cent, while the figure of 0.98 per cent for the current Fiscal Year is the lowest recorded so far. This reinforces the low use of substance abuse in the ADF and the positive steps taken to manage this issue.

Family Support

Finally, but most importantly we are also working on ensuring that we provide support to the families of our ADF members, as part of our employment offer.

The life of the ADF family is very challenging. We require them to relocate regularly, we require them to sacrifice family time when we deploy ADF members for up to 8 months at a time and we know they are often separated from the support of extended family and friends.

We are also conscious that ADF children, throughout their schooling, attend twice the number of schools as are attended by non-ADF children.

All of this has driven research into whether our support services for families are sufficient.

The research recently conducted demonstrates our ADF families are overall satisfied with their health, standard of living, relationships, and achievements. The research also demonstrates the value placed by families on the provision of modern, community standard Defence housing located near bases.

The Defence Housing Australia (DHA), for which I am also responsible, is aware of the importance of housing to ADF members and their families. DHA delivers quality housing by managing around 17,300 residences across Australia, worth around $7.8 billion. It is especially important, especially in a time of high operational tempo, that these homes reflect the desired work/life priorities of ADF members, taking into consideration transportation routes,

community infrastructure and proximity to ADF bases.

Under the Government’s Nation Building Stimulus Plan the DHA has added an extra 802 houses to their schedule.

I am happy to say that DHA are progressing well with the delivery of these houses. 716 of them have been contracted. 589 houses have commenced major site works and 173 have now been completed and are ready for

Defence families to move into in the next posting cycle in early 2010. This is a wonderful achievement.

While housing and many aspects of our support to families is going well we can be doing better.

We still have some issues around effective communication with families, sometimes they feel isolated with nowhere to turn. To assist families with this, Defence has identified ways of improving our communication with ADF families, and how to be more responsive to families with increasingly diverse circumstances, needs and preferences for the level of involvement that they wish to have in the ADF community.

To help ADF families feel more connected to the Defence community, we are doing more to foster and support a sense of shared responsibility for this between families, ADF members, ADF commanders, senior leaders and

Defence. Our efforts include improving the quality and reach of communications with families, and encouraging members and their families to

take advantage of opportunities to be involved in unit and ship activities and pre-deployment preparation.

Meeting the Challenge - Expanding the Pool through Diversity

I would now like to turn to some of the key initiatives that we are undertaking to meet the recruitment and retention challenge.

The Government would like to see the ADF become more representative of our community. By itself this is a worthwhile aim. However, it also allows us to have a more stable base from which we can recruit and retain our people.

To this end, and with the full support of the ADF leadership, we are encouraging a diverse workforce. We are also seeking to expand the pool of our potential recruits.

I would now like to outline some of the initiatives that we are undertaking in this area.

Recruiting and Retaining Women in the ADF

With women making up only 13.4 per cent of our ADF, it is evident that this is an area we can do better, and which the Government is committed to doing better.

Last week, I was pleased to be able to launch the Chief of the Defence Force’s Action Plan for the Recruitment and Retention of Women.

This Plan is aimed at breaking down the barriers to women joining and remaining in the Defence Force. This is a very significant initiative that gives a sharper focus to the vital contribution that women make in the ADF.

It is targeted at recruiting more women, introducing more initiatives to allow career choice for women, examining how working arrangements can be more flexible to facilitate a more ‘family friendly’ workplace, and striving for cultural

change.

While Defence is implementing a range of initiatives on this front, the Action Plan will drive a much more detailed analysis of the reasons for low female recruitment rates and how we can improve retention rates.

I am confident that this Plan is the beginning of a strong drive for change. We can engage women in our workforce. We can give them choice. And we can afford them every opportunity to have a rewarding career. In fact, this is how it has to be if we are to have an effective 21st century ADF.

At the heart of this Plan is the clear recognition that the ability to have and raise their families is a key consideration for women in the ADF. It is also a key consideration for men in the ADF. This is where choice and flexibility is so important.

We need to recognise that the ADF is not the most family friendly profession. We must appreciate that family life demands stability, and that posting cycles and employment conditions need to recognise that critical fact.

I am hopeful that the CDF’s Action Plan will address some of these issues. For example, under the Plan, ADF members will be able to purchase up to four weeks additional annual leave each year and have the right to work part-time after maternity or adoption leave.

All of these initiatives are vital if we are to increase the participation of women in the ADF. This Action Plan is a commitment to the women of the ADF.

Indigenous Australians and the ADF

The Government is also working to improve the recruitment and retention of Indigenous Australians.

In 2008 the previous Minister for Defence Science and Personnel, Mr Warren Snowden, launched both the ADF Indigenous Recruitment Strategy and the Directorate of Indigenous Affairs.

The ADF Indigenous Recruitment Strategy aims to: • Steadily grow the number of Indigenous Australians recruited into the Australian Defence Force. • Improve the satisfaction levels of Australian Defence Force Indigenous

members; and • Better integrate Indigenous culture into Australian Defence Force values and lifestyle.

In addition to this, Defence Force Recruiting, with assistance from the Directorate of Indigenous Affairs, has developed an Indigenous microsite for the Defencejobs internet site. The new microsite showcases currently serving Indigenous servicemen and servicewomen as positive role models.

A Multicultural ADF

Defence wants to be recognised as an employer that values diversity of cultures in its workforce.

Just as a diversity of cultures has greatly benefited our community, further diversification of the ADF will greatly benefit our military.

While Defence has military members originating from over 20 ancestral backgrounds and speaking over 30 different languages at home, only 6.5 per cent of military personnel speak a language other than English at home, compared to 21.5 per cent of the wider Australian population.

That is why Defence is conducting work on a Multicultural Recruitment Strategy to assist with attraction and recruitment to make the ADF more representative of the Australian community. I am hoping to make further announcement on this strategy in the course of 2010.

Getting in early - targeting Australia’s Youth

In addition to these other initiatives, the Government has also been keen to promote the early engagement of young people with the ADF so that they can learn and inform themselves of the many roles and careers available within the ADF.

For instance, the Gap Year Program offers young people up to 12 months military training and experience, without committing to a full career in the Defence Force.

There are 700 available positions in 2009, and the full 700 positions will be filled. Female participation in this program is very high, while the take-up rate to the full-time force is also encouraging. As at 1 October 2009, 231 of the 700 participants from 2008 were serving in the permanent forces.

Other initiatives, such as the Defence Work Experience Program and the ADF Youth Connection program are helping to promote the values of the ADF to young people across the country.

The Future Reform Agenda - Making it work properly

So far I have outlined the comprehensive work program the Government is undertaking to meet our workforce challenge by providing a compelling employment offer and expanding our recruitment and retention targets.

This will not work, however, if we do not reform the defence ‘backbone’ - the core areas that are involved in the delivery of these services.

Strategic Reform Program and Shared Services Agenda

The Government's Defence White Paper outlined Force 2030. The associated Strategic Reform Program outlined how we will achieve this.

This agenda of deep reform is focused on three key areas: improved accountability; improved Defence planning and improved productivity.

With respect to improving productivity, Defence needs to implement smarter, tighter and more cost effective business processes and practices that will make sustainment and support management more efficient and effective. This will also be true of the personnel area.

This reform is very important for our people. It is essential that they are supported by effective and efficient administration.

In the past, Defence has been burdened with cumbersome administrative processes, particularly in the area of human resource support.

Under the Strategic Reform Program Defence will revise the level of services provided and increase the use of shared services across the organisation. This is important work integral to reforming the way Defence does business. Through this process, we can expect to see our ADF members being supported more effectively.

Reforming our Human Resources Systems

A key component of the shared services agenda involves modernising Defence's payroll processes and personnel information and communications technology (ICT) systems.

It is true to say that Defence currently has inefficient and antiquated payroll arrangements that are not supporting the needs of its personnel.

This became evident when Defence implemented a range of pay-related initiatives over the course of the last twelve months. As a result, we have seen problems with SAS pay, Army Reserve Pay and the provision of flying allowance.

There were also recently issues surrounding the application and payment of Special Forces Disability Allowance to Air Force forward air controllers belonging to 4 Squadron.

Although this was not an issue involving systemic problems with Defence's pay system, it demonstrates how important it is for Defence to continuously improve their business support processes.

As I indicated to the parliament on 20 October 2009, I requested Defence to resolve this situation urgently, and wrote to the then acting Chief of Defence Force in that regard.

I can advise that in relation to this situation, the Chief of Air Force has approved the business rules for the payment of SFDA to eligible 4 Squadron members.

I also understand that retrospective payment of Special Forces Disability Allowance has now been provided to all eligible 4 Squadron members.

I am now waiting on advice from the Chief of Air Force to confirm whether any other action is required to conclude this matter but I am confident the major issues have now been resolved in respect of these individuals.

The Government is committed to ensuring that our service personnel and families are paid their correct entitlements on time.

The move towards a shared services model for managing human resource functions will help reduce inefficiencies in the system and determine clear lines of accountability and responsibility for payroll processing and management in Defence.

It is important that Defence owns a modern personnel ICT system that can be easily accessed and used by all Defence staff.

Defence is doing two things to reach this goal. It will first implement a technical refresh of its current personnel systems to build a stable platform for further software development. Further capability will be delivered through Defence's Personnel Systems Modernisation project also known as Joint Project 2080 Phase 2B.1.

Conclusion

The Rudd Government is of the view that an increasingly strong and adaptable workforce in the Department of Defence is central to national security.

That is why it is essential that we provide a compelling and total employment offer that attracts, retains and rewards personnel.

It is also why we must expand the targets of our recruitment and retention areas through providing more flexible and smarter practices to encourage greater diversity.

Finally, we need to press on with ensuring that Defence’s systems are finally updated and are able to deliver the services that we need.

Defence needs to attract and keep people through offering more than just a wage or just a job. Rather, it is profession, a vocation and a way of life. And because it is so, its professionals need the highest levels of personnel services and support.

The men and women of Defence deserve nothing less.

I wish each and every one of you the best for your graduation and future careers.

Media contacts: Rod Hilton (Greg Combet): 02 6277 4771 or 0458 276 619 Defence Media Liaison: 02 6127 1999 or 0408 498 664