Minister for Defence Stephen Smith and Minister for Defence Materiel Jason Clare today released the full electronic version of the 2011 Public Defence Capability Plan (the DCP).
The DCP provides information for the Defence industry on Defence’s planned capital equipment acquisitions.
This is the third full update of the Defence Capability Plan since the 2009 Defence Capability Plan was released by then Defence Minister Faulkner.
The DCP changes over time as Defence priorities and strategic circumstances change, new projects enter the DCP, and as projects are approved and removed from the DCP.
This update includes adjustments made since the second DCP update was released in December 2010.
This 2011 DCP update includes adjustments to the DCP since the update in December last year, and which were publicly advised on 29 June 2011 with the release of a DCP supplement, including the approval of 18 projects comprising:
— Second Pass approval for nine projects at an estimated total cost of around $4 billion, including the acquisition of 24 new naval combat helicopters.
— First Pass approval for nine projects, with funding approved of around $100 million to fund capability development activities.
Three new projects have been introduced to the DCP and approved since the December 2010 update: an additional C-17 heavy lift aircraft, the Largs Bay amphibious ship (to be commissioned as HMAS Choules) and 101 additional Bushmaster vehicles.
The adjustments also include the cancellation of the project to acquire additional C-130J aircraft following the Government’s acquisition of the additional C-17 heavy lift aircraft.
The on-line update includes a small number of additional changes from the December 2010 update which were not included in the June supplement. Further adjustments reflect the ongoing refinement of the information in the DCP, in particular variations to schedule and cost.
Today’s release fulfils the Government’s commitment to continue to update the DCP.
While the DCP has been enhanced following the Government’s response to independent advice from the Australian Strategic Policy Institute (ASPI) on ways to make it a more useful and more transparent document, the Government continues to believe that it needs to be improved to be more useful to industry.
I have previously discussed with Industry representatives the need to improve the quality of pre-first pass information provided to Industry.
The new Associate Secretary (Capability) in Defence will be responsible for reviewing capability proposals before they are considered for inclusion in the Defence Capability Plan, to ensure they reflect the Government’s strategic requirements and that all risks are well understood.
Proposals for inclusion of new projects in the Defence Capability Plan will initially be subject to an assessment by the Associate Secretary (Capability) whose mandate will include the review of all potential capability proposals to ensure that they align with strategic requirements and that cost and risk is understood and accounted for.
After agreement by the Secretary and the Chief of the Defence Force, new proposals for inclusion in the Defence Capability Plan will be considered by Government bi-annually, in consultation with Central Agencies.
Additional measures to improve the quality of information in future Public DCPs include that future DCPs will have reduced levels of over programming.
The overall DCP program is developed taking into account the available funding, the delivery schedules for projects and the capacity of industry to develop and deliver the projects.
The principle behind over-programming is to provide flexibility and to aid in ensuring that best use is made of available funding in the event of delays to the development of individual projects.
It is a deliberate strategy to manage the risk of projects being delayed, so that funding can be diverted to other high priority Defence capability projects.
All versions of the DCP since it was first published in 2001 have been over programmed.
Defence will implement improved planning to reduce over-programming in the DCP by better aligning capacity with resources and strengthening management focus.
This process will be undertaken in conjunction with the next Defence Planning Guidance process.
As outlined in the 2009 White Paper, the Defence Planning Guidance is the Government’s premier Defence planning document between White Papers.
The Defence Planning Guidance process aligns strategic guidance, capability decisions and resource planning on an annual basis.
Future iterations of the DCP will be more closely linked to this process.
Linking updates to the DCP with the Defence Planning Guidance will ensure that information provided to Industry is based on the latest national security tasks set by Government.
This also underlines the fact that the DCP is primarily a national security document.
It is not of itself an industry policy document, but guidance to industry.
“The proposals in the Public DCP represent the various capabilities needed to achieve a balanced force capable of meeting contingencies that the ADF may be faced with over the next two decades,” Mr Smith said.
“Getting these projects right and delivering them to the Australian Defence Force on time is an essential contributor to the ADF meeting these future challenges.”
A small number of projects are not included in the Public DCP due to their national security classification.
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