Australia’s ramping up of defence spending, and the proposed allocation of hundreds of billions of dollars to the incoherent, unjustified AUKUS submarine project, amounts to the generous rewarding of the least competent, and least accountable, department in the Commonwealth.
An examination of the auditor-general’s recent evaluations of a range of defence programs shows that the department and its staff have an atrocious record of managing not merely major arms projects but a wide range of activities across the portfolio.
In 28 performance audits since 2018, the Australian National Audit Office (ANAO) has issued 11 highly critical reports, including four in the past 12 months, suggesting that many years of pressure on defence to improve its internal processes and management have yielded nothing.
The greatest hits of the defence establishment in recent years include:
- management of its $2.5 billion’ worth of General Stores Inventory, in which defence could not “demonstrate that it is achieving efficiency and economy”, while there was no “active focus or response by defence senior leaders on known issues contributing to inefficiency and overstocking”
- management of health services to ADF personnel, which “demonstrated shortcomings in ensuring the implementation of all contracted requirements” and lacked “assurance that services are being delivered effectively against the contracted requirements”
- the acquisition of Hunter-class frigates, which “lacked a value for money focus”, suffered from lost documents, had a poor tender process, resulted in long delays and cost blowouts, and saw the undocumented decision by a panel headed by then-defence secretary Dennis Richardson to include an ultimately successful tender by BAE in the process.
- defence’s overall management of contractors, in which the department “cannot demonstrate the effectiveness of its arrangements”
- management of the Defence Industry Security Program, intended to enable contractors to meet security requirements, for which there’s no “assurance that the program is effective”, no “fit-for-purpose arrangements to monitor compliance”, no “arrangements to manage identified non-compliance”, and defence didn’t even know which contractors needed to participate
- defence’s support for its ANZAC-class frigates, for which it “cannot demonstrate the efficiency or outcomes of its sustainment arrangements” and which was marked by uncompetitive tender processes
- significant problems with its acquisition of a battle management system as part of the Land 200 project
- the failure of defence’s Projects of Concern process, such that the department can’t “show that the Projects of Concern regime contributes materially to the recovery of underperforming projects and products”.
While major defence acquisition projects the world over are marked by delays and cost blowouts — exacerbated in Australia by defence’s preference for bespoke materiel rather than purchasing off-the-shelf hardware, and politicians’ preference for building locally — the ANAO reports show a department failing across not merely procurement but health services for personnel, security requirements for contractors, contract management and asset control.
Nor does that list include the worst defence failure of all: its inability or refusal to deliver effective internal systems to manage the mental health of ADF personnel and curb suicide rates among both serving members and veterans — a problem so bad a royal commission was needed to tackle the crisis.
At no stage has defence suffered any repercussions from the revelation of its management failures beyond the occasional embarrassing question at Senate estimates. Successive governments have been unwilling to think critically about the permanent state of management incompetence at defence, preferring instead to hide behind the flag and the hardware. The pattern continues under the current government, with dim Victorian Right hack Richard Marles — deputy prime minister because he’s not from NSW and not from the Left — the latest defence minister to fall into line with what the brass and the national security establishment wants.
The lack of any consequences for defence officials was picked up by the Greens’ best parliamentary performer, the experienced NSW Senator David Shoebridge, who — referring to the Hunter-class frigate audit — wondered at the most recent estimates hearings in Foreign Affairs, Defence and Trade why the new government’s defence strategic review had been conducted by a panel including Richardson:
the secretary who pulled the BAE frigate tender out of the dustbin and whacked it on the shortlist for a project that’s now blown out to $45 billion and counting, that’s 18 months delayed and that should never have been put on the shortlist because it was a thought bubble? It wasn’t an actual in-the-water design … the secretary while all of these problems on acquisition and capability delivery had their genesis?
As Shoebridge then elicited from defence officials, Richardson’s name was put forward by defence on a list of three for the review panel — for three positions.
A lack of competition in a selection process at defence? What a shock…
Twenty or so years ago it was decided that a competent and effective public service tended to be a political liability, interfering as it did with the smooth exchanges of favours between corporate and political interests. A public service that was independent and with a clear mandate to act according to the dictates of law, statute, and regulation limited the ability of governments to pursue their immediate political interests in the donor bucket, the media and at the ballot box. Doubtless, also, the existence of highly qualified, highly experienced, and highly competent public servants frequently proved aggravating to the delicate egos of some elected officials. Fortunately, now, those days are gone. The examples Bernard has illustrated are not of incompetence, but of success! Success in the generation of announceables and photo opportunities, success in pork barrelling provincial electorates, success in opening rich veins of unaccountable revenue into the pockets of the deserving donors, success in growing the portfolios of ex-ministers and their retinues. Isn’t that what it’s supposed to be all about?
This is spot on, as is Bernard’s article! Very disappointing that the ALP have made no effort to try and change things, as they really need the money to do a host of other things. Even if you agree with AUKUS (as I do), there is a worrying lack of care about value for money. I think Aus spends twice on Defence what Israel does, the difference is that Israel gets way more for their money, driven partly by past existential threats.
The ALP began the rot under Defence Miinister Beazley who couldn’t bear Departmental advice on submearines getting in the way of porkbarrelling into Port Adelaide – forty five years ago.
Wh says politicians don’t know what they’re talking about. Everybody!
The rot started with Howard who marginalised ‘special interest groups’, as he called them – migrants, First Nations people (a term he would have outlawed as he shut down ATSIC), women, youth and a few others, and shut down public discourse and discourse in government departments.
And led us into war in Iraq and Afganistan.
Who can ever forget the picture of Tony Abbott sitting in the cockpit of a cardboard F-35 stealth turkey?
Also same old PS/mates incompetence by Defence Heads and governments, seemingly rolling over for UK &/or US contractors, why?
“Australia’s ramping up of defence spending, and the proposed allocation of hundreds of billions of dollars to the incoherent, unjustified AUKUS submarine project, amounts to the generous rewarding of the least competent, and least accountable, department in the Commonwealth.”
I don’t know. Home Affairs would give Defence a run for its money.
The common factor being that they both were run by Obersturmbahnfuhrer Dutton………………..
Actually, tbf to Dutton, defence was the only place where he added anything, where his rottweiler instincts provided some contrast to to usual rolling over for a tummy rub of all the other Defence Ministers (Poodle Pyne anybody?).
His greatest contribution to Defence, was banning unisex toilets and Pride events. Gee, what a guy!
Well yes, he did do a lot of silly things, but he did challenge Defence about their continual mismanagement of major projects. Not a fan of his, but dont recall any other Minister doing this, back to Bomber Beazley as outlined above.
Having worked in engineering at a firm that supplies defence with manufactured products I can tell you that the department is robbed blind by foreign specification requirements listed on drawings. They will require a piece of steel to be purchased from the designers preferred supplier in Europe for say $A5000 when the same material can be sourced locally with appropriate certificates for $A500. Laziness and timidity within defence procurement is costing this country billions.
And TIMIDITY fits perfectly for Australian governments when it faces US and/or UK instead of standing up for their own country and countrymen/women, they go cap in hand as though they are peasants begging a favour from their overlords. For forty six years I have called Australia home but it only took a few months to see that talk big as it might, when it comes to dealing with other nations Australia’s like babes in cradles, except for asylum seekers and first nation people that is. Unfortunately it’s the Australian people who pay the price for this unvelievable behaviour, especially those on lower incomes who are sacrificed for the sake of the 1%.
Idiot warmonger Marles looking to make himself a hero with the military and score a job like a few of the LNP failed polls.
Judging by the performance of current and recently employed people at Defence, maybe those school kids they’re trying to recruit are already capable of running Defence, the only department never to have had an efficiency dividend thrust upon it.
The War Memorial is their shield when it comes to accountability. Visitors go weak at the knees and it’s game over.
You’ve gotta wonder, if all those shibboleth fondlers have the slightest inkling what those of us still waiting for brainectomies think of them, when the merest invocation of Our Boys and/or The Fallen is enough to silence all critical enquiry.