Royal Australian Navy Discussions and Updates 2.0

DDG38

The Bunker Group
Verified Defense Pro
Meanwhile, back in the working Navy :
"HMAS Adelaide departs Fleet Base East at Garden Island, Sydney. Defence is pre-positioning HMAS Adelaide to Brisbane to provide additional HADR support if requested by the Government of Tonga." Image Source : ADF Image Library
20221017ran8625149_0047-edit.jpg
 

Bob53

Active Member
Not always, it can be used as a kind of stimulus. Pumping money around the economy, to improve confidence, employment, driving productivity, increasing the size of the economy in real terms.

Admittedly some does this more than others. a MOTS purchase of overseas gear doesn't have the same local stimulus as say building a ship, with Australian steel, with Australian workers, fitted with Australian systems, supplied by Australian suppliers. Some expenditures are dual use, infrastructure/military expenditure. Telecommunications cables, satellites, housing etc. Many of Australian industries are dual use. Civmec is an example. Encourage capability in one sector can benefit multiple sectors. Truck and bus construction and IFV production have overlap, so strengthening one can help the other find economies and efficiencies.

Defence has been a key source of pilots which has fueled the Australian aviation industry. The aviation industry fuels tourism. It isn't always a zero sum game.

There are plenty of damaging things that can happen to limit spending to GDP. Like the time we slowed down Hobart class constructions, with delayed the project 18-24 months additional, and deliberately make it cost nearly a billion dollars more, just to lower yearly expenses. This is exactly the type of destructive behavior decoupling defence from GDP is hoping to stop.

Plenty of high growth economies spend significant money on defence. Singapore, the US, China, etc. Plenty of high HDI countries spend big on defence, Norway, Singapore, Switzerland, UK, France, Korea, Israel.

The idea that there is only a limited bucket with so much money isn't correct. It isn't a choice between having an economy and have a proper defence force, or funding education or defence, or health and defence. A well managed, healthy, economy can "do it all" within broad limitations.

European countries often seek mutual offsets, we buy planes from you, you buy helicopters from us. Having a defence industry enables deals like this. This really does more in terms of making the money go further. While it can be very restricting regarding platform selection, it can certainly show defence dollars aren't just generic dollars.

Historically Australia is probably more of a 2.5% of GDP country. We aren't Belgium, we administer ~25% of the earths surface.
Ome factor that is often missed is the cash the gov spends onshore wash’s around in the economy Multiple times.

Assume a $1 bil project is spent in Australia and the prime contractor makes 5% profit. They pay tax on the profit. The other $950m gets spent on wages, services and COGs with income tax, gst and company taxes paid in most cases means probably around 20-30% of it gets returned to the gov in tax. The balance that makes its way into employee pockets and downstream suppliersmostly gets spent by the contractors and employees of those businesses do the same with gst and taxes.

Im not equipped to fully estimate how many times a dollar spins within the au economy but $1b spent in au would probably end up costing the government maybe half of that after taxes are returned from flow on spending.
 

Morgo

Active Member
Ome factor that is often missed is the cash the gov spends onshore wash’s around in the economy Multiple times.

Assume a $1 bil project is spent in Australia and the prime contractor makes 5% profit. They pay tax on the profit. The other $950m gets spent on wages, services and COGs with income tax, gst and company taxes paid in most cases means probably around 20-30% of it gets returned to the gov in tax. The balance that makes its way into employee pockets and downstream suppliersmostly gets spent by the contractors and employees of those businesses do the same with gst and taxes.

Im not equipped to fully estimate how many times a dollar spins within the au economy but $1b spent in au would probably end up costing the government maybe half of that after taxes are returned from flow on spending.
Indeed. What you’re talking about is measured by the fiscal multiplier, and the RBA estimates it to be 1.1 to 1.3 times the initial spend. Here’s some more reading if you’re interested:

Box C: Spillovers from Public Investment | Statement on Monetary Policy – February 2018.

I will note that we are quite a way OT now - this isn’t a public economics forum. Please don’t shoot me mods!
 

alexsa

Super Moderator
Staff member
Verified Defense Pro
Indeed. What you’re talking about is measured by the fiscal multiplier, and the RBA estimates it to be 1.1 to 1.3 times the initial spend. Here’s some more reading if you’re interested:

Box C: Spillovers from Public Investment | Statement on Monetary Policy – February 2018.

I will note that we are quite a way OT now - this isn’t a public economics forum. Please don’t shoot me mods!
No problem, it was a useful discussion .... but as you say ... back on topic please.
 

ngatimozart

Super Moderator
Staff member
Verified Defense Pro
Just a quick question before we get rid of the bean counters
In Australian defence what constitutes capital expenditure?
What we buy or what we build ?
When you building an asset you are buying it so it is capital expenditure. It doesn't matter if you are paying for the materials, labour etc., it is still a capital asset and therefore treated the same as if you acquired it prebuilt from an outside vendor.
 

spoz

The Bunker Group
Verified Defense Pro
All expenditure related to the acquisition of a capability is from capital funds in Aust. That includes the prime equipment, required r & d, initial spares and training, personnel and other project costs, any needed infrastructure (both to acquire the capability and then to sustain it), tests and trials, and setting up the support structure and processes. It does not normally include the salary costs of the crews who will operate the capability, however; any deltas in that are managed under a separate funding approach.
 
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ddxx

Active Member
HMAS Adelaide embarking CH-47s before sailing for the Tonga relief mission. Image Source : ADF Image Library
View attachment 48806
It’s pretty awesome how aviation assets can jump on when required for a specific mission and jump off when they’re not. It’s almost as if they don’t detract from any other capability when required for a mission.

I wonder if this ability would be helpful in meeting Defence’s current policy objective of being able to: shape our region (the Indo-pacific) through the ability to project military force?

An awesome example of the multirole versatility of the Canberra Class.
 
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oldsig127

The Bunker Group
Verified Defense Pro
I love that we have these ships, a true example of soft power projection
I am curious how this will work with contactless delivery principles it's very different to pushing a C17 load of pallets onto the tarmac and departing
Seems to have worked twelve months ago when HMAS Adelaide provided HADR to Fiji. At the very least they're well practiced.

oldsig
 

Stampede

Well-Known Member
Yes the LHD's have certainly proved their worth many times over.
The range of contingency's they can cover is impressive.
Big ships with integral flight deck ,docking well and accommodation spaces for vehicles,aircraft and warm bodies provide options by defence for government.
A good return on investment.

Choules replacement and suggestions of a Pacific Support ships should reflect what we know from experience.

Large LHD's or LPD's are proven systems

Regards S
 

Goknub

Active Member
The big deficiency is the lack of intra-theatre sea life ie LHD is great at getting stuff to the main island but we lack the ability to then ship equipment between the surrounding locations.

During HADR these smaller islands are often the hardest hit. There is a project to rectify this but I believe it should be a much higher priority.
 

Morgo

Active Member
The big deficiency is the lack of intra-theatre sea life ie LHD is great at getting stuff to the main island but we lack the ability to then ship equipment between the surrounding locations.

During HADR these smaller islands are often the hardest hit. There is a project to rectify this but I believe it should be a much higher priority.
Agreed. The LCM-8 and LARC-V replacements are proceeding under LAND 8710. From the press it seems like Austal are in the lead for the LCM-8 part but presumably they’d need to partner with a vehicle manufacturer for the LARC.

Separately I haven’t seen anything on the Balikpapan replacement. If there was one area of investment not already announced that I would prioritise it would be this, perhaps with 6-8 (or more) of something like the Damen LST 120H (Landing Ships - Damen) which would be a substantial capability boost and complementary to our existing fleet. I would rank this a much more realistic and higher priority than up gunned OPVs / buying Japanese submarines etc or any of the other ideas that have been floated on here in recent months.

EDIT: Deleted a superfluous link.
 

John Newman

The Bunker Group
Agreed. The LCM-8 and LARC-V replacements are proceeding under LAND 8710. From the press it seems like Austal are in the lead for the LCM-8 part but presumably they’d need to partner with a vehicle manufacturer for the LARC.

Separately I haven’t seen anything on the Balikpapan replacement. If there was one area of investment not already announced that I would prioritise it would be this, perhaps with 6-8 (or more) of something like the Damen LST 120H (Landing Ships - Damen) which would be a substantial capability boost and complementary to our existing fleet. I would rank this a much more realistic and higher priority than up gunned OPVs / buying Japanese submarines etc or any of the other ideas that have been floated on here in recent months.

EDIT: Deleted a superfluous link.
The LCH replacement hasn’t been forgotten. It’s now an Army project and is due to start in 2025.

From the 2020 DSU:


The three Army projects are in Green.
 

John Newman

The Bunker Group
The big deficiency is the lack of intra-theatre sea life ie LHD is great at getting stuff to the main island but we lack the ability to then ship equipment between the surrounding locations.

During HADR these smaller islands are often the hardest hit. There is a project to rectify this but I believe it should be a much higher priority.
You’re painting the picture much bleaker than the reality.

Yes we currently don’t have the LCH capability (the replacement project starts in 2025), but 4 x LCM-1e can be operated from one LHD and can distribute personnel and equipment easily to ‘surrounding’ Islands.

And not forgetting aviation capabilities such as embarked CH-47F too.
 

StingrayOZ

Super Moderator
Staff member
The LHD itself can also move around the region. The LHD isn't the only naval asset in the region NZ is sending support as well.

I wonder if LCH are that useful in tsunami type situations where there is a lot of junk & debris around on beaches and finding a clear, clean, landing site for a larger landing craft can/could be difficult? Smaller islands are often fringed by reefs that I would imagine would also restrict larger vessels. I imagine larger landing craft would be more complimentary than replacement?

IMO the LHD clearly a getting a work out. It seems like there is some sort of situation 6-12 months in our region. Also if a situation expands in the scope of the disaster (like the Australian fires), having these larger ships seems to be quite useful, with multiple landing craft and significant on ship space and facilities.
 
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