Michael Slattery has written in @AuManufacturing previously about the effect the unexpected cancellation of defence contracts has on SME defence manufacturers. Here, he argues that while out of pocket SMEs are still waiting for a solution, decision paralysis has set in in defence.
On the morning of September 16, 2021 I had secured two appointments.
The first with Australian Naval Infrastructure (ANI) and the second with builder Laing O’Rourke.
Listening to the news that morning, I then knew both meetings would be cancelled but drove to the respective sites anyway.
Laing O’Rourke were building the future submarine site at Osborne, South Australia (pictured) and ANI were representing the Commonwealth in that build.
Design, planning and works were well underway, the footings had been poured with threaded rods protruding ready for pillars and pylons, the submarine site had 450 construction workers busily going about their tasks.
The surrounding subcontract community and defence industry were negotiating contracts with the builder, the Commonwealth and the submarine contractor Naval Group.
Some mistakenly procuring materials believing their contract was “in the mail”.
It is rumoured that there were $1 billion worth of contracts sitting on Naval Group’s desk awaiting instructions from the Commonwealth to proceed with submarine activities.
There was no reason to believe otherwise, no reason to believe that the contracts weren’t coming and then in a flash, all was gone.
The defence primes, the government and industry were conducting roadshows, describing the careers of the future to students, parents, teachers and TAFE Instructors.
These stakeholders were encouraging and discussing STEM subjects and long term career opportunities.
The parents and educators knew better, they countered with cries of the “Valley of Death” which in their minds lurked around every corner.
Five billion dollars of compensation later, and the site is dormant. Dormant of people, dormant of cars and dormant of activity.
Weeds grow upon the fencing. The once vibrant car park is empty.
The wind bellows upon the once proud signage, adorned with our Coat of Arms.
This site now sits as a memorial for defence procurement in Australia!
At a time when more than ever we need to protect our people, build our future safety and develop our sovereign capability, we sit in a country so confused that it cannot make a decision.
It is estimated that some 300 people are working on the Nuclear Industry Strategic Taskforce (NIST) , costing taxpayers around $800k per day.
It is agreeable that the force posture assessment in conjunction with the NIST are important and need overarching consideration.
However “decision paralysis” has set in, it is set in quicksand.
With anticipation and trepidation we await March 2023.
Knowing that this is only the beginning of AUKUS and hoping that those 450 construction workers may continue.
In the meantime… we wait and we wait.
Picture: Adelaide’s unfinished submarine construction yard
Michael Slattery is an experienced manufacturing business owner and manager, and a leader in the expanding defence industry sector. Michael is business development manager at Rowlands Metalworks, a board member of the Institution of Engineering and Technology (SA/NT) and president and committee member of the Australian Industry & Defence Network – South Australia (AIDN SA).