ANAO Report reveals serious problems with SEA 1000  

ANAO Report reveals serious problems with SEA 1000

Despite repeated assurances by Defence, the RAN and relevant Ministers that the Future Submarine program is on track – the reality revealed by the Australian National Audit Office today shows that this is far from true.  Titled: “Future Submarine Program – transition to design,” it shows that the current critical phase has already been granted a 9 month extension – after prime contractor France’s Naval Group requested 15 months.  It states:

“The program is currently experiencing a nine-month delay in the design phase against Defence’s pre-design contract estimates, and two major contracted milestones were extended. As a result, Defence cannot demonstrate that its expenditure of $396 million on design of the Future Submarine has been fully effective in achieving the program’s two major design milestones to date. Defence expenditure on design represents some 47 per cent of all program expenditure to 30 September 2019.”

To say that this is a problem – worth either $50 billion or $80 billion depending on the methodology –  is a major understatement.  Defence itself has assessed the program to build 12 new submarines as high risk, but has never had a proper Plan B, apart from extending the life of the current 6 Collins class submarines.  Even this activity is proceeding at a slow pace.

APDR has been cautioning about this looming capability shortfall disaster for the last two years ever since it became apparent that behind the scenes the relationship between Defence and Naval Group was poor. This led to a 12-month delay in signing the Strategic Partnering Agreement.  However, now is not the time for point scoring and the time has come for Defence to urgently examine the feasibility of acquiring a New Generation Collins class.

On the other side of the world, Saab-Kockums is offering just this solution to the Netherlands for their Walrus class replacement contract.  If successful, they will deliver the first of these long-range, high technology submarines in 2027.  Even if the current (delayed) schedule for SEA 1000 is met – and it almost certainly will not be – the RAN will not have their first Attack class in service until 2034.

A cynic is entitled to wonder why the ANAO report has been released today during the school holidays and in the midst of the bushfire crisis.  The ANAO answers to Finance Minister Mathias Cormann.  He is also responsible for the Government-owned ASC – builder and maintainer of the Collins class – which is one of the entities crucial to the future of Australia’s entire submarine enterprise.  At any other time of year, this story would be front page news on every paper in the country.