World Millitary Power

The monster budget is coming, the one which, in a single blow, will make all the political debate since the federal election seem like an episode of Seinfeld, the show about nothing.

The strange thing is, as the government prepares its first budget and has set up the National Commission of Audit to prepare the way, one of the biggest, most dysfunctional, most wasteful and most misguided proposed programs has not even been mentioned. You could say it remains submerged.

Not a word has there been about this gold-plated, $30 billion sinkhole. The only sign that the Abbott government is preparing to confront this impending, unaffordable, inexcusable financial black hole was its announcement that former federal MP Sophie Mirabella was joining the board of ASC Pty Ltd, formerly known as the Australian Submarine Corporation.

ASC is a basket case. Its fingerprints are all over a sequence of expensive failures. It cannot be reformed, does not deserve to be saved and should be killed off before it can do any further damage to national security.

And yet the Royal Australian Navy expects that ASC will be the prime contractor of the most costly project in Australian defence history, the Future Submarine project, which it envisages will involve the construction of a dozen submarines, in South Australia, to replace the Collins-class submarines, also made in Australia and also a financial and operational sinkhole.

That this plan is even being put forward as a matter of policy by the defence bureaucracy shows how deeply ingrained is the cultural delusion and arrogance of the Australian armed forces.

The cycle of money-soaking arrogance runs like this: there is no hardware suitable for local conditions so the Defence Materiel Organisation must design tender specifications that are specialised for Australian needs. The local military-industrial complex will produce custom-modified, low-volume, high-cost military hardware that is the best in the world.

The reality, in a cycle repeated over decades, is the military-industrial complex produces gold-plated, high-maintenance products that never match hype and cost twice as much as they need to.

Whatever one may think of Mirabella, she is an economic dry and does not shirk the dirty work of confronting spendthrift bureaucrats, military brass and trade unions, all of whom have treated the Australian Submarine Corporation and the Defence Materiel Organisation as a giant honey pot.

Both organisations are impervious to competence. In 2011, the Labor government commissioned an audit of the navy's procurement process. It revealed a shambolic labyrinth that produced cost blow-outs and chronic delays. That same year, the navy received an SOS after cyclone Yasi smashed Queensland but was unable to deploy a single ship. All three of its large amphibious ships were out of service and two of them were so unseaworthy they never returned to service.

At the same time, the navy also had to scrap six large landing craft before they were even used, at a cost of $40 million, because they could not be loaded onto the motherships they had been bought for.

The opposition defence spokesman at the time, David Johnston, described all this as ''an absolute walking, living, breathing example of incompetence''. He is now Defence Minister, responsible for this fleet of foolishness.

The minister needs to be aware the military is as duplicitous as it is deluded. The culture of hazing and harassment, to which the military turned a blind eye for decades, proves that. In 2009, a report entitled Strategic Review of Naval Engineering delivered a scathing assessment of the navy's ability to keep ships in operation. That report was suppressed. It was kept from the then defence minister.

The idea that Australia should produce a dozen submarines in South Australia, at a projected cost of about $3 billion a vessel, is madness. One only need look at the the Collins-class submarines. They were manufactured in South Australia by the Australian Submarine Corporation at a cost of about $1 billion per submarine - far more than projected. The navy has never had more than two of the six submarines in service at any time.

The new submarines will have a unit cost that dwarfs the Collins-class subs if built here, or roughly three times the cost of acquiring the submarines from foreign shipyards. The navy disputes this disparity but history does not.

The grand South Australian submarine project is an unaffordable hold-over from Kevin Rudd's unbudgeted grandiosity. The government will save more than $20 billion if it brings this project down to size and offshore.

One only need to look at the navy's existing major procurement project, the Air Warfare Destroyer Program, to see costs blowing out and unforseen complexities. Every year produces another procurement embarrassment. This year, it is the fleet supply ship HMAS Sirius, commissioned in 2006. It will be taken out of service after just eight years because it cannot function adequately in rough seas.

Australia's defence establishment remains culturally fixated on big hardware when national security is increasingly determined by asymmetrical warfare, cyber security and intelligence gathering. A new and upgraded style of military security requires greater sophistication, rather than defence capacity being dominated by big boys with big toys. In this case, very complex, very conspicuous, very vulnerable and very, very expensive hardware at a time when software rules.

Read more: http://www.smh.com.au/comment/future-submarine-project-a-farce-that-has-missed-a-mention-20140119-312p7.html#ixzz2quwoQbIM