May 23rd 2015

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Articles from this issue:

COVER STORY No deal in federal budget for single-income families

CANBERRA OBSERVED Mixed budget: 'Battlers' put on the backburner

SOCIETY Marriage myths do not stand up to close scrutiny

INTERNATIONAL AFFAIRS Supreme Court argument goes to heart of marriage

POLITICS Understanding Orwell: the dangers of ideology

EDITORIAL Executive salaries: Telstra CEO bells the cat

ECONOMICS Productivity: do we understand it at all?

INTERNATIONAL AFFAIRS UK election: implications of Conservative victory

NATIONAL AFFAIRS Floating reasons to build our submarines here

CINEMA Best-laid plans oft end in corruption

INTERNATIONAL AFFAIRS New fronts in the fight against human trafficking

EDUCATION Non-government school tuition trumps SES status

CLIMATE CHANGE Bjorn again sceptics show face of intolerance

DRUGS Ice: an epidemic rages under our very noses

BOOK REVIEW The man who would not be prime minister

BOOK REVIEW The father of the green revolution

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Floating reasons to build our submarines here

by Peter Kelleher

News Weekly, May 23, 2015

Now that Defence Minister Kevin Andrews has made a commitment to support the naval shipbuilding industry in Australia, it is opportune to consider the technical, economic and strategic reasons to build in Australia the submarines that are to replace the ageing Collins-class boats.

Kevin Andrews

It is a salient fact that Australians have been historically, and continue to be, high achievers when it comes to technical innovation.

The refrigerator (yes, the fridge), the underwater torpedo, the black-box flight recorder, the electric drill, the ultrasound, Wi-Fi, the bionic ear, the pacemaker ... Need I go on?

And now, with the closures of our local car manufacturing facilities, there has never been a better time to put the abundance of highly skilled workers to work who might otherwise become dependent on Centrelink.

The strategic reasons pile up too.

Maintaining a naval shipbuilding capability is vital to preserving the sovereignty of Australia. Yet, as it is, Australia runs the risk of a capability gap. Former Defence Materiel Organisation boss Warren King recently described the situation as an “emergency”.

The Department of Defence has considered extending the life of the Collins-class submarines but realised that the cost would be prohibitive and the outcome would not redress the increasing capability differential between our submarines and the more modern submarines operating in our region. And at the end of a huge spend we would be left with the same ageing out-of-date boats we have today.

While the price of building a submarine in Australia may be higher than building them overseas, the build is only a third of the total cost, when maintenance and other costs are taken into account.

Since the future submarine program was announced, $3.004 billion has been spent on keeping our Collins-class boats in the water. And the cost to the taxpayer into the future is estimated at $100 million per year per boat (not factoring the fact that on average, the RAN has only two boats at sea at any given time).

So, given we need new boats and quickly, once we have found an international design partner to meet our needs, we should immediately sign a build contract for four off-the-shelf submarines from that design house.

The idea is to go with the chosen partner’s proven at-sea platform with minimal changes; only those required to meet legislative requirements and to integrate the Mk 48 torpedo and harpoon. This will allow a gradual retirement of the Collins-class boats and bring into service submarines that are much more up-to-date technologically at a much quicker rate.

And, as the off-the-shelf models come into operation, in the background we will be designing and preparing to build our “aspirational” boats.

One advantage of building an off-the-shelf submarine, beginning in 2016, would be that RAN personnel would be evaluating the technologies of the selected partner much sooner than otherwise and it would allow plenty of time to enable design feedback into the “aspirational” boats being progressively designed at an orderly pace in the background.

The technical case for ordering existing designs in the first place is unanswerable. Any problems found during construction, testing and sea trials are best sorted out with full access to the partner’s design and support personnel and their sub-supplier’s design and development teams.

So, while the first conventional submarine is being designed in detail, the Australian build program will already be under way.

The interim boats will warm up the welding equipment and reestablish a local Australian submarine assembly capability in Adelaide using a known product. Not mixing two unfamiliar activities (a new design with a new build) will ease the way to rebuilding local capacity. The interim build would also allow for the future submarine program’s tech­nology transfer.

Moreover the similarities between the interim and “aspirational” capability in terms of component make-up will allow local production houses to be selected and prepared early. The logistic support arrangements can thus be put in place sooner, which should help to “future proof” the maintenance of the submarine force.

If the Collins-class boats can be retired four years earlier through a one-per-year build of interim boats, we would come close to covering the costs of each interim boat built.

This might involve the decommissioning of one Collins-class submarine and placing another in an “operational pause”. The decommissioned boat would be stripped for spares.

With only four Collins-class boats operating, and improvements cancelled, as much as $250 million of the submarine operating budget could be diverted annually to fund the first batch of new boats. Over time, as new submarines are delivered and additional Collins-class boats retired, the interim solution could end up cost neutral – four interim boats at no cost.

Building submarines locally means better control of the project, providing a deep understanding of how they operate, which is essential to reducing maintenance time and costs. Maintenance requires workers with specialist skills; and the workers that learn these skills can be same workers who build the submarines in the first place.

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