The smart money is that in defending Australia we will be on our own. Part 3

The government’s recent Defence Strategic Update suggests Australia faces the greatest threat to our independence since 1942. In this final article of three, I consider the need for a Review, both to design a new Australian military strategy and analyse the essential elements of the new force structure that this will require.  

We have argued that with Australia facing its greatest military threat for nearly 80 years, there is an urgent need for a revised military strategy feeding through to a new force structure plan. Yet the Defence Minister excluded major new defence acquisitions from the force structure review that she commissioned from her department last year. As Marcus Hellyer of ASPI says:

“Despite the 2020 update’s assessments of our strategic circumstances and its conclusion that we need new offensive capabilities to impose cost and risk on a potential major-power adversary, and that we won’t have 10 years of warning time to acquire those capabilities, the force structure plan that accompanied the update still has a business-as-usual look to it.”

The new military strategy needs to be based on an objective of deterring an attack on Australia by any potential adversary, including a great power. Of course, it is idle to pretend that Australia could defeat a nation like China in a major war, but that is not the objective. Rather it is to build the capability, as Hellyer suggests above, to impose a level of cost on an adversary to the extent that the risk/reward ratio would not support an attack on Australia. It is also worth reiterating that an invasion of Australia is one of the least likely scenarios we are guarding against. Without a forward base (which is one of the important contingencies we need to guard against), the logistics alone likely make an invasion extremely difficult, as Japan concluded in 1942. As we have also discovered with COVID-19, there are considerable advantages in living in an island located “at the arse end of the world”, as Paul Keating used to say.

The task for the military strategist, therefore, is to evaluate the options for developing a force capable of denying access to any adversary, up to and including a great power, in the air and sea approaches to Australia’s north and west. This anti-access, area denial (A2/AD) strategy essentially requires planning for an air-sea battle, along the lines of America’s revised military doctrine that came into force in 2010. But if America withdraws from the contest for regional primacy with China, a scenario the planners will need to recognise as a distinct possibility, under present circumstances Australia could not rely on any other country to provide military support.

The new military strategy therefore should be based on the possibility that we have to act alone. It will also need to consider different options for enforcing A2/AD in Australia’s approaches. Should the primary focus for the ADF be on forward areas beyond the archipelago or within the island chain? May a ‘crocodile in the moat’ strategy be appropriate? Or perhaps a layered denial strategy extending from the moat to forward deployments up threat would be the preferred approach. These are critically important issues, with major implications for the force structure, which we suggest have yet to be addressed.

The enormity of this challenge can hardly be overstated.

The first consideration is that to build an effective A2/AD capability designed to deter a great power will require a substantial increase in the defence budget. The government will need to advise the planners how much it is prepared to spend. In the first instance, for example, it might increase the defence budget by 50 per cent within a time frame that takes account of both the urgency of the situation, due to the elimination of warning time, and also the schedule that is required to spend the money efficiently on acquiring new assets.

Another consideration is that Defence will need to spend the money in a smart way. With a clear need to acquire a great deal of technologically advanced new defence capability with both a tight budget constraint and a short investment timeframe, Australia simply cannot afford to procure assets that come in at two or three times the global benchmark cost with delivery way over the horizon.

This is one reason why it is essential to bring both the submarine and the frigate projects into a comprehensive force structure review. For example:

  • The budget for Attack class submarine is now about $50 billion at constant 2016 prices, 150 per cent more than the guaranteed fixed price tender of under $20 billion for the German contender that met all the required specifications for the future submarine under the competitive evaluation process with a much higher level of Australian Industry Content (AIC) and a much earlier delivery date
    • even if everything goes well, which it will not because of the high risks around the project, the first submarine will not enter service until the mid-2030s with a high risk of a capability gap
    • with the Navy not being able to guarantee that just one Attack class submarine will be on station at all times until 2054
  • The Hunter class frigate’s budget is over three times what the US Navy, with a capability requirement almost identical to that of the RAN, has budgeted for the Fincantieri FFG(X) frigate, a platform that was rejected by Australia
    • with the Hunter class now having to be redesigned, it is a highly risky project with an uncertain time frame and a budget that may well blow out even further.

On cost and delivery grounds alone, unless these programs can lift their game in a major way, the government should seriously consider cancelling both of them and urgently evaluate options to provide the capability more quickly and within acceptable budgets.

In addition, if we are to continue to build naval platforms locally the industry must be reformed so that it can deliver warships and submarines at global benchmark costs, as it once did with the Anzac frigates and Collins class submarines, and with a high level of AIC. There is no reason why Australia cannot do this, with a better organised industry and a purchaser-provider model in place. In bidding for the future submarine, for example, the German company TKMS did an exhaustive study of costs in the Australian industry and its fixed price tender was based on building the boats at the same price in Adelaide as in Kiel, with 70 per cent AIC.

The other issue that a proper force structure review would need to evaluate is whether the current very expensive acquisition projects will deliver a capability that is fit for purpose. In this context, we consider briefly the Attack class submarine, the Hunter class frigate and the F-35 joint strike fighter.

In any asymmetric conflict, submarines can provide significant benefits to the weaker power because, by being both highly lethal and very hard to detect, countering them requires an enormous and very costly effort. To maximise the deterrent effect, submarines need to be employed in an offensive capacity and be able to project sufficient force on station. The Review would need to examine carefully whether the Attack class can meet this requirement. It could persuasively be argued that, with the vast distances involved, a submarine with a speed of advance (SOA) of 10 knots cannot meet this criterion – the SOA arguably needs to be double this. An ability to escape at high speed if detected is also desirable both for effectiveness and survivability. Many naval experts see a clear operational requirement for nuclear-powered submarines for the RAN. The Review should examine this and whether Australia would be able to acquire SSNs and, indeed, whether we can afford them. A future submarine will also need the capacity to deploy technology that is emerging now, such as un-crewed underwater vehicles (UUVs). We understand the Attack class design only includes the capacity for just one small UUV.

The SEA5000 frigate program is in a no better state than the submarine. Defence selected an unproven British design, rejected for consideration by the USN, which is now known to be seriously overweight. It also specified that it incorporate the US Aegis system and SM missiles, never before integrated with a UK platform, as well as the excellent but heavy Australian CEAFAR radar and a SAAB combat management system. The risks of this program are unnecessarily excessive. There are strong grounds for cancelling this project and selecting one of the other two original contenders – either the Navantia F-100 that already incorporates the US systems and which we know how to build, or the Fincantieri ship the Americans selected and piggyback off their design.

The other consideration with SEA5000 is that Australia’s policy of replacing like with like takes little account account of technological developments, particularly, in this case, the increasing vulnerability of surface ships to advanced ballistic and hypersonic missiles. The US Navy has recognised this and is gradually switching away from costly, large warships the size of the Arleigh Burke (the Hunter class will be of a similar size, but far more expensive) to both smaller frigates, half the cost of an Arleigh Burke, that can still provide an anti-missile defence, and to corvettes of sufficient size to deploy an ASW helicopter. In its most recent force structure analysis, the USN also placed a much greater emphasis on acquiring autonomous and semi-autonomous naval vehicles with small crews or, increasingly, no crews at all. The Review should consider these issues and whether there would be advantages in acquiring fewer than nine large ships, for example, with additional smaller, corvette-sized vessels and un-crewed vehicles.

Australia’s F-111 aircraft, which served very successfully for over 40 years, provided a highly credible deterrent. Whatever advantages the F-35 joint strike fighter may have, it has limited capability as a strike aircraft in the Australian context because of both its short range and its modest payload. It is not clear, for example, that it can deploy the long-range anti-shipping missiles included in the Force Structure Plan. If it were to operate in the air-sea gap it would require in-air refuelling, with the tanker aircraft being highly vulnerable to interdiction and destruction. The Review should consider these issues and evaluate whether Australia should perhaps limit the F-35 acquisition to two squadrons and seek to acquire a new generation long-range bomber, such as the B-21 aircraft under development in the US.

Finally, there is a critical issue as to how the Review of the Australian Military Strategy and force structure should be established and who should undertake it. While Defence should provide the secretariat, there are legitimate doubts about the ability of either Defence or the ADF to undertake a comprehensive review in a neutral manner because of their demonstrated concern to maintain the existing force structure and current relative weight between the Services. As with Paul Dibb in 1985, Australia has a number of well-respected strategic experts in think tanks and the universities, including former Defence Ministers. With wide ranging terms of reference that did not seek to exclude any ‘sacred cows’, one or more of these experts, working closely with the Chief of the Defence Force, could be expected to provide the Minister with a high quality Review.

Jon Stanford gratefully acknowledges the support of Submarines for Australia and for comments provided by members of its expert Reference Group.


In a former life, Jon Stanford was a Division Head in the Department of the Prime Minister and Cabinet. Currently, as a Director of Insight Economics, he is undertaking significant research on Australia’s future submarine project, generously supported by Gary Johnston, owner of the Submarines for Australia website.

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