Think Tank Bursts Nelson's Budget Bubble

Australian Government News, According to the Australian Strategic Policy Institute’s authoritative Defence Budget Brief 2007-08, there is still a gap between the Howard Government’s Defence Capability Plan and the money available to fund it. “Unfortunately, notwithstanding all the new money flowing into Defence, there remains a mismatch between plans and funding,” the report says. 
 
Other key points in the ASPI Brief include: 
 
– Despite the additional $1.8 billion of additional logistics funding in the budget, under current plans, rising personnel costs and escalating investment levels look certain to squeeze the money available for operating costs from 2008-09 onwards. 
 
– Of particular concern is the absence of funds to cover all the additional personnel and operating costs of new equipment to be delivered over the next several years like AEW&C, Armed Reconnaissance Helicopters and Air to Air Refuelling, all due for delivery in 2009. 
 
– In total, more than $2.1 billion of planned new capability will now arrive late. At the same time, the approval of new projects from the 2006 Defence Capability Plan has already fallen behind schedule even though the document is less than 12 months old. 
 
– These increasing delays create a steep curve of planned new investment in the near future. “What makes this year easier inevitably makes future years harder,” according to ASPI. 
 
It is clear that the Government is yet to properly address net personnel and operating costs. As the ASPI Brief questions, “How much will projected future surpluses need to be reduced to deliver the ADF that’s currently planned”?