The Australian government announced Monday (29 June) two deals with munitions suppliers that should help secure hundreds of Australian jobs for another decade. Defence signed a new agreement with Thales Australia for the continued management and operation of Australia’s munition factories in Benalla (Victoria) and Mulwala (New South Wales). The A$1.1 billion agreement provides ensures the supply of key munitions and components for the Australian Defence Force (ADF). The government also signed a deal with supplier NIOA Munitions.

Noreen Galanza and Emily Chalis of Thales Australia complete final assembly of 5.56mm ball ammunition on the production line at Benalla. (PHOTO: Government)

Minister for Defence Linda Reynolds said the deal means the manufacturing sector can retain local skills and expertise. “It’s vital that we continue to enhance the readiness of the ADF and ensure we have the necessary sovereign depth for sustaining key capability and materiel such as the surety of supply of munitions,” Reynolds said. “This agreement with Thales Australia will continue to maintain a safe and compliant operation, and increase our domestic capacity to manufacture key munitions in support of ADF operations. Mulwala and its sister facility in Benalla are the home of munitions manufacturing in Australia, generating vital job opportunities in regional New South Wales and Victoria. This new agreement not only reinforces the 20-year strong partnership between Defence and Thales Australia, but also provides job certainty for more than 650 highly-skilled workers at these factories.”

Thales CEO Chris Jenkins and First Assistant Secretary Joint Systems within Capability Acquisition and Sustainment Group in the Department of Defence Ivan Zlabur signed the contract for Strategic Domestic Munitions Manufacturing ( SDMM ) at Russell in Canberra. (PHOTO: Government)

Minister for Defence Industry Melissa Price said the government had identified munitions and small arms as a critical capability for a sovereign defence industry. “We’ve developed and implemented a plan to grow munitions and small arms capability in Australia, as one of our Sovereign Industrial Capability Priorities,” Price said. “It’s about identifying critical capabilities for the ADF, strengthening our defence industry, and creating new opportunities. Thales Australia has an excellent track record of working with local small businesses and I have no doubt they’ll continue to utilise the skills and ingenuity of small businesses right around Australia.”

Benalla NIOA contract

Up to 100 jobs will be created after the government signed a new 10-year contract with Brisbane-based company, NIOA Munitions, for a tenancy at the Benalla munitions factory in Victoria. The Australian-owned company is the largest commercial supplier of non-guided munitions to the Australian Defence Force (ADF) through its partnerships with global manufacturers.

Minister for Defence Linda Reynolds. (PHOTO: Government File Photo)

Minister for Defence Reynolds said Monday “enabling new companies to establish and grow in Victoria will harness local skills and expertise in the manufacturing sector and the Australian defence industry exports. NIOA is already pursuing export opportunities from the new tenancy at Benalla and is well placed to manufacture munitions for use by the ADF in the future. This contract will establish NIOA as a tenant alongside Thales Australia, where together they will provide opportunities for domestic manufacturing while enhancing supplies of key munitions for Defence.”

Minister for Defence Industry Price said NIOA is also in the process of building an advanced manufacturing facility in Maryborough, Queensland, with joint venture partner Rheinmetall Waffe Munitions. The project has received support from the government’s Regional Growth grant scheme. “This new contract was born out of the Sovereign Industrial Capability Priority Industry Plan for Munitions and Small Arms Research, Design, Development and Manufacture which I released in 2019,” Price said. “This capability plan provides a roadmap to help current and aspiring Australian defence industry businesses understand the capability priorities of the ADF, now and into the future.”

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