ADF General discussion thread

[ASSAIL]

Oh dear....
Public service shipping company....guess it will be heavily unionised as well.

Paddy Crumlin has been appointed to the strategic taskforce.
He has been boss of the Maritime Union and a leading activist/shitstirrer for decades.
It would be nice to think Alexsa’s solution of 4 officers per ship and the balance Pacific Islander crew would give the fleet a commercial chance but with Crumlin’s involvement, no chance.
This is a rerun of one of Bill Shortens pet project from a few years ago which was found to be a commercial non starter
Nothings changed.

 

[StingrayOZ]

It would be nice to think Alexsa’s solution of 4 officers per ship and the balance Pacific Islander crew would give the fleet a commercial chance but with Crumlin’s involvement, no chance.

Yeh, I like Alexsa's proposal as well. I think it would make a significantly larger impact and have a wider capability. The reality is Australia can't do everything. Particularly when it comes to overseas logistics, by definition, we can not do it all alone. Why not try to strategically partner with our pacific family, and help them, help ourselves and help our trading partners. It also provides greater buy in of our pacific family into the same threats and outcomes as ourselves. We are tied together.

12 ships? How many ships does it take to export just our grain exports? Are we trying to secure just our mango exports?

 

[FoxtrotRomeo999]

The general concept of merchant ships (RFA?) supporting Government Military and Civilian activities appeals to me. What follows is a brain dump (my ideas rather than facts):

1. Strategically, there is a case for a sovereign capacity. The South Pacific is not a high priority for international shipping. State and non-state actors can deliberately delay critical cargoes to the South Pacific.
2. The Pacific Support solution should be included here rather than in Navy.
3. Could such ships work with existing South Pacific shipping providers? Or in fact be leased to them.
4. How do we fund it? It should not be at the expense of the any Defence funding. Ideally, it would pay for itself.
5. And yes, like everyone else, I worry this could easily degenerate into a "pigs at the trough" waste of Government funds and effort.
6. The capability, including crews, must be available when required.
7. We need a big enough Navy to protect it (hint: significantly more than 11 surface combatants).

 

[alexsa]

Good day folks

The AISR was established by Albo when he was the Minister for Infrastructure (etc etc which included transport). The MUA were supportive but on the basis they would then look to 'look after' the crew. The coalition change the bargining rules slightly.

If previous practice was to be followed (that applied to the Delos before she was converted to the HMAS Sirius) then the ships would be 'chartered' to Teekay to run. They current 'run' the Ocean Protector as an ADV and the CAAP vessel (Stoker, Besant etc) as operators. Teekay provide their crews for these vessel under their agreement. I would expect these vessel would be operated as commerical vessels on some sort of run but theer is a paucity of information on what sort of ships are being considered. Australian companies used to run tanker and still run LNG carriers (but these are not going to be around much longer I expect).

So that leaves Teekay or some of the Bass Strait operators as the likely candidates assumeing these vessel will be Australian flagged. Bass Strait may be questionable as the tonnage as been replaced on those runs over the last decade with modern ships that will meet the emmision standards of MARPOL Annex VI.

In anycase, these will not be cheap to run if we use crews on the day on -day off (plus annual leave) rotation the ships using MUA crew used to have and the fact the getting ships mainained by the crews was a challenge.

The whole discussion on 12 ships is odd. The starting point should be what do we need (type, range, geared, gearless, RO-RO, RO-PAX, tanker, gas carrier and so forth) and what runs will be serviced. That would determine the number and type of ships. It sounds like they are looking at RO-RO but I am not sure we can employ 12 RO-RO vessels on the coast. Regional trades to the pacific islands are already covered. Companies such as CNCo go as far as using PNG crews as part of the deal. It is mildly amusing to find that ANL (Australian National Line) now owned by the French with its ships flagged anywhere but Australia .....is shipping to the Pacific as well

ANL was killed by workplace issues. I agree with Assail in that there is a real risk this will become a political tool to get the MUA back in the game. I don't think that would be sustainable as the government is likely to have to pay a supplement for the operation of the ships (or have a very low .. or non-existant.. charter rate). A combination of the AISR, professional management, a clear need for the ships purchased and means to ensure they are properly maintained may just give it a chance.

 

[Morgo]

Interesting news coming from the budget this evening. Unsurprisingly light on detail given the ongoing review, but the nominal Defence budget was flat vs the March figures at $46.9bn.

But inflation has been revised upward to 5.75% from 3%, so it’s an effective 2.75% real terms cut. Not sure what is being given up to achieve that.

Lots of talk still about increasing Defence funding in the medium term, which will presumably be detailed in next year’s full year budget.

 

[ADMk2]

Interesting news coming from the budget this evening. Unsurprisingly light on detail given the ongoing review, but the nominal Defence budget was flat vs the March figures at $46.9bn.

But inflation has been revised upward to 5.75% from 3%, so it’s an effective 2.75% real terms cut. Not sure what is being given up to achieve that.

Lots of talk still about increasing Defence funding in the medium term, which will presumably be detailed in next year’s full year budget.

Talk is all it will ever be.

The defence strategic review will “prioritise” $2.85b in cuts this year and $1.8b next year at least to make this happen…

All the fantasy kit wish-lists would do well to bear such realities in mind.

 

[Morgo]

Talk is all it will ever be.

The defence strategic review will “prioritise” $2.85b in cuts this year and $1.8b next year at least to make this happen…

All the fantasy kit wish-lists would do well to bear such realities in mind.

That is deeply troubling.

Do you mean a cumulative $4.65bn nominal reduction in the budget vs FY23? Depending on inflation this would be a 15% to 20% real terms reduction.

Presumably cuts of this size will have to come disproportionately from the APS and consultants?

Probably fair to say (as you do) that any talk of corvettes / more DDGs / P8s / another squadron of F35s etc is completely cactus….

 

[Wombat000]

Ummm, at this stage I’m unconvinced.
not long ago we wanted a budget of 2%, now it’s stated to be higher.

the strategic projections haven’t suddenly changed, and ive heard no mention of a national change of tack and Australian acquiescence to the situation. I suggest the eras of benign defence budgets are over.

I think it’s reasonable that seeing the luxury of a 10yr warning period being no longer relevant, that a review of what we actually need in the quicker term rather than what we ‘want’.

sure some toys might need to be rationalised for more quicker practical solutions.
I think defence will remain a very high priority.

then again, perhaps I’m being naive?
I don’t think I’m far off tho.

 

[Redlands18]

Government lays out defence strategy in new federal budget - Defence Connect
A rundown of the budget from Defence Connect.
Defence spending to increase by 8% over the financial year, despite being flagged as adding to budgetary pressures. The budget includes new measures to shore up relationships with Pacific neighbours. Also announced are a raft of new measures for Vet affairs. There is no new announcements on capabilities due to the ongoing review.

 

[Aardvark144]

Talk is all it will ever be.

The defence strategic review will “prioritise” $2.85b in cuts this year and $1.8b next year at least to make this happen…

All the fantasy kit wish-lists would do well to bear such realities in mind.

Can I ask for detail as to how you came to this data seeing as the FSR will not be released until March 23 with a classified advance report due to the Government next month?

 

[Volkodav]

Government lays out defence strategy in new federal budget - Defence Connect
A rundown of the budget from Defence Connect.
Defence spending to increase by 8% over the financial year, despite being flagged as adding to budgetary pressures. The budget includes new measures to shore up relationships with Pacific neighbours. Also announced are a raft of new measures for Vet affairs. There is no new announcements on capabilities due to the ongoing review.

It makes sense that money be reserved for yet to be determined priorities.

A big plus as I see it is the replacement of contractors and consultants with greater numbers of APS and ADF personnel. They could quite literally expand the workforce, improve pay and conditions, while still saving money.

 

[John Newman]

Government lays out defence strategy in new federal budget - Defence Connect
A rundown of the budget from Defence Connect.
Defence spending to increase by 8% over the financial year, despite being flagged as adding to budgetary pressures. The budget includes new measures to shore up relationships with Pacific neighbours. Also announced are a raft of new measures for Vet affairs. There is no new announcements on capabilities due to the ongoing review.

An 8% increase? Hmmm....

Not quite as clear as the Albo Government makes out:

Defence budget shows the government is keeping its powder dry—for now | The Strategist

The Albanese government just released its first budget, but it’s the second one for 2022–23. In this article I’ll focus on what’s changed between the March budget (B1) and the October one (B2). The key ...

www.aspistrategist.org.au

Quotes from the above article:

“When all adjustments are taken into account, B2’s consolidated defence spending (the Department of Defence and the Australian Signals Directorate combined) is $48,699.7 million. That’s only $84.7 million more than B1’s despite the $382.2 million foreign exchange increase. That means B1 and B2 are virtually identical in all the key cost categories of workforce, acquisition, sustainment and operating. However, because GDP predictions have increased dramatically by around 8%, Defence spending as a percentage of GDP has fallen from 2.11% in B1 to 1.96% in B2.

“That gets us to the nub of the problem for Defence. A key factor behind that increase in GDP is inflation which is running hot. When the 2016 white paper funding line was developed, planners assumed annual inflation of 2–2.5%. In 2020–21 it was somewhat higher at 3.8%. It jumped to 6.1% last year and the budget papers predict 5.75% this year. So while B2’s funding line is a 7.1% increase on 2021–22 in nominal terms, once we take inflation into account, it may be around 1% in real terms. That translates into billions of dollars of lost buying power.”



From Budget 1 (LNP) to Budget 2 (ALP), as a percentage of GDP, spending has fallen from 2.11% to 1.96%.

And as for the 8% increase, it’s closer to 1% when inflation, etc, is taken into account.

‘Smoke and mirrors, smoke and mirrors’

 

[ADMk2]

Can I ask for detail as to how you came to this data seeing as the FSR will not be released until March 23 with a classified advance report due to the Government next month?

The report is irrelevant in the face of funding that simply isn’t there… No doubt whole projects will be cancelled and others prioritised, but if the money isn’t there, the money isn’t there, as they say. Hence my caution on project wishlists. No matter their utility to which ever scenario you prefer, they all have to be funded first…

As a percentage of GDP, defence slice of the pie has dropped now to 1.96% and in real cash terms due to inflation has dropped $2.85b in this financial year and $1.8b in the next.

Forward estimates are all well and good, but they are “estimates”. The estimate was defence would receive 1.98% GDP in the May budget. Yet here we are…

 

[Aardvark144]

The report is irrelevant in the face of funding that simply isn’t there… No doubt whole projects will be cancelled and others prioritised, but if the money isn’t there, the money isn’t there, as they say. Hence my caution on project wishlists. No matter their utility to which ever scenario you prefer, they all have to be funded first…

As a percentage of GDP, defence slice of the pie has dropped now to 1.96% and in real cash terms due to inflation has dropped $2.85b in this financial year and $1.8b in the next.

Forward estimates are all well and good, but they are “estimates”. The estimate was defence would receive 1.98% GDP in the May budget. Yet here we are…

This 'Budget' was never going to contain any new information for Defence, as they have said in multiple media outlets, the real test will be in March next year. If we are serious about Defence, funding will be there.

 

[Morgo]

It makes sense that money be reserved for yet to be determined priorities.

A big plus as I see it is the replacement of contractors and consultants with greater numbers of APS and ADF personnel. They could quite literally expand the workforce, improve pay and conditions, while still saving money.

The “reserved money” is not real.

Inflation is running at 7.3%. So this is a 0.7% real increase year on year.

And a cut in real terms versus the budget announced in March.

 

[Morgo]

The report is irrelevant in the face of funding that simply isn’t there… No doubt whole projects will be cancelled and others prioritised, but if the money isn’t there, the money isn’t there, as they say. Hence my caution on project wishlists. No matter their utility to which ever scenario you prefer, they all have to be funded first…

As a percentage of GDP, defence slice of the pie has dropped now to 1.96% and in real cash terms due to inflation has dropped $2.85b in this financial year and $1.8b in the next.

Forward estimates are all well and good, but they are “estimates”. The estimate was defence would receive 1.98% GDP in the May budget. Yet here we are…

Spot on. This is the cut that’s not a cut.

 

[Volkodav]

The “reserved money” is not real.

Inflation is running at 7.3%. So this is a 0.7% real increase year on year.

And a cut in real terms versus the budget announced in March.

Inflation would have been the same had the former government stayed in, and there wouldn't have been an October budget to increase spending to compensate for inflation.

Think on that for a bit.

Times are hard, not just in Australia, budgets are tight, not just in Australia. Complaining the budget wasn't increased enough is a bit ingenuous, but for the change of government, there would be no increase at all.

Complaining funding details haven't been released is also problematic as the defence review that will dictate the funding hasn't been completed yet.

There are major items being covered by the review, each with impacts and costs, there will be recommendations to government, but until there are there can be no detail, no decisions, no prioritisation.

 

[Morgo]

Inflation would have been the same had the former government stayed in, and there wouldn't have been an October budget to increase spending to compensate for inflation.

Think on that for a bit.

Times are hard, not just in Australia, budgets are tight, not just in Australia. Complaining the budget wasn't increased enough is a bit ingenuous, but for the change of government, there would be no increase at all.

Complaining funding details haven't been released is also problematic as the defence review that will dictate the funding hasn't been completed yet.

There are major items being covered by the review, each with impacts and costs, there will be recommendations to government, but until there are there can be no detail, no decisions, no prioritisation.

This wasn’t meant as a criticism of the current Gov. I reckon they’re doing a good job all things considered.

Just pointing out that it’s definitely misleading to call it an 8% increase!

 

[vonnoobie]

At the end of the day funding wise we are doing better then most. Rather then worrying about if we are getting enough dollars we should instead be using these tough times as a lesson in being smart on how we spend that money. Really we should always do that and many here have said as much since I joined years ago, hopefully they will get a kick up the a**e and do what's in best interest of the ADF and Australian people rather then those at the top +civilian and military).

 

[StingrayOZ]

The report is irrelevant in the face of funding that simply isn’t there… No doubt whole projects will be cancelled and others prioritised, but if the money isn’t there, the money isn’t there, as they say. Hence my caution on project wishlists. No matter their utility to which ever scenario you prefer, they all have to be funded first…

Whole projects have been cancelled and more are likely to be put on hold or cancelled out right. Some never went through. And with the whole attack debarkle, now closed, spending that should be ramping up, isn't. But how much is spent getting out of projects that will now not give any capability.

There is quite a bit that can be done within the defence dollars within the defence budget. I wouldn't expect huge change, the government has only been in for ~6 months and it was already undergoing a process before.

Some projects could be announced, but zero funding for this year, and then funding picked up going forward.

Definitely need to wait for the NOV then in march, to get clarity.