Enhancing Australian Defence

No-one wants war, but the risk of conflict in our region is substantially growing, and we could well find ourselves in war whether we want it or not.

The challenge now is to rapidly strengthen the Australian Defence Force with the goal that our efforts, along with our allies, can deter our adversaries from war.

Our key recommendation in this 4th paper in our 6 report series with the Institute for Public Affairs is to lift Defence spending from its current level of just below 2 per cent of gross domestic product to 3 per cent of GDP by 2028-29.

• This proposed funding would provide an additional $40.9 billion to Defence over the four years of the forward estimates (compared to the current government planning for additional spending of $5.7 billion).
• Over a decade this new funding adds $206.9 billion to planned defence spending.
• By contrast the Government’s current plan proposes to add $50.3 billion over the coming decade.

But without the other recommendations set out in the report, this will achieve little.

In this paper we set out why Australia has fallen so dramatically short of maintaining an adequate defence capability. The reason is a perhaps natural desire to take advantage of a peace dividend after the end of the Cold War. Second, over many decades Australian governments have been prepared to free-ride on American commitments to global and regional security.

Free riding is no longer an acceptable response to our bleak security outlook.

Our other recommendations in this paper bolster the case for how a government could dramatically lift Defence spending and see quick and positive increases in military capability. Governments need to do a better job making the public case for a bigger effort on security. Taxpayers need to be convinced that this is a necessary expenditure and one that will be spent wisely.

We argue that Parliament’s Committee on Foreign Affairs, Defence and Trade must produce an annual inquiry on Australia’s regional threat environment, recommending urgent policy steps, including on the scale of defence spending needed to address our worsening strategic environment.

With a new administration assuming power in Washington DC, we judge that Australia’s efforts to lift its performance as a contributor to global security mean that the Commonwealth government should engage the incoming US administration to discuss burden sharing on both defence spending and capabilities. A stronger Australian defence effort makes us not only more self-reliant, but also a more credible ally.

Frankly, the urgency of our strategic outlook is such that deterrence must be strengthened as a framework across all like-minded and consequential democracies.

This means burden sharing and a willingness to plan more openly with our key partners.

We also recommend that the Defence budget should be regularly increased to compensate for the effects of inflation, particularly on military systems. The accumulated effects of inflation over recent years mean that current Defence spending plans are imposing real cuts on Defence capabilities even when nominal dollar allocations increase.

RECOMMENDATION 18: Government should also establish an advisory board of eminent persons separate from the Defence Department and reporting to the Prime Minister, like the US Defence Policy Board, to advise on required military capabilities, assess progress and risks in equipment delivery, identify efficiencies in spending and promote speedy innovation. Australia’s defence situation is too difficult to leave planning and implementation just to the Defence Department and the Australian Defence Force.

RECOMMENDATION 19: The parliamentary Committee on Foreign Affairs, Defence and Trade must produce an annual inquiry into Australia’s regional threat environment, recommending necessary policy steps, including on the scale of defence spending needed to address our worsening strategic environment.

RECOMMENDATION 20: Australia must lift its performance as a contributor to global security. The Government should engage the incoming US administration to discuss burden sharing on both defence spending and capabilities. RECOMMENDATION 21: The Commonwealth government must put the Defence budget on a rapid trajectory to reach 3% of GDP in the next term of government.

RECOMMENDATION 22: The Defence budget should be regularly reviewed and increased to compensate for the effects of inflation, particularly on military systems. need some of the nation’s smartest minds to help drive better, more innovative results.

RECOMMENDATION 23: The Commonwealth government should establish an advisory board of eminent persons separate from the Defence Department and reporting to the Prime Minister, along the lines of the US Defence Policy Board, to advise on required military capabilities, assess progress and risks in equipment delivery, identify efficiencies in spending and promote speedy innovation.

RECOMMENDATION 24: Defence must be radically overhauled to stress openness and accountability in delivering equipment projects. Government must itself commit to greater openness in policy making and not hide behind false claims of the need for secrecy.

This was published by Strategic Analysis Australia.