Webdiary - Founded and Inspired by Margo Kingston

A couple of days ago a mate was wondering how many like himself had received recent letters encouraging them to re-enlist.  From the look of this you'd guess there's plenty.  Defence Minister Joel Fitzgibbon gave this speech at the Australian Strategic Policy Institute in Canbera last night.  In it he discusses the recruitment problems, the new White Paper, and the Rudd Government's perception of the ADF's role.  On reading it you begin to wonder how long it will be before conscription becomes necessary.

Looking forward to the three years ahead, I have set for us four key objectives.

1.    A new Defence White Paper
2.    Putting the Defence Budget back on track
3.    Putting defence procurement and capability back on track, and,
4.    Dealing with what may be our biggest challenge of all - our people and skills shortages.

The New Defence White Paper
During a visit to the Australian Defence Force Academy in February, I formally announced the commissioning of the new Defence White Paper.  The need for a new White Paper was a consistent theme for me during my twelve months as the Opposition spokesman.  White Papers are a rare event - this paper will be only the fifth since the end of the Vietnam War.  

A Defence White Paper and the strategic guidance it provides are critical to success in developing Defence policy.  In the absence of an up-to-date strategic plan, Government decisions in Defence can become ad hoc and misdirected.  This, I would argue, is exactly what happened here in Australia over the course of the past few years.  The document the former Government was working from was developed in the late 1990s and released in the Year 2000.  

The world has changed so much since then:
·    September 11 and subsequent terror events in Bali, Jakarta, London and Madrid;
·    The wars in Iraq and Afghanistan;
·    The nuclear ambitions of rogue states like North Korea and Iran;
·    Big shifts in the global distribution of power including the rise and rise of China: and,
·    Failing states in Melanesia and the south Pacific.

Given these changing circumstances, a review of Australia’s strategic outlook is well overdue and we hope to have our review complete by the end of this year.

In the past, White Papers have rightly had a major focus on strategy, force structure and capital investment in major military platforms.  But the current project will do that and more.

The new White Paper will be unprecedented both in its broad scope and the demands it will place on my Department.  For the first time, the Australian Government will have a comprehensive picture across a range of Defence issues including:
·    the current security environment;
·    our force structure requirements and the levels of preparedness required to meet Australia’s defence needs;
·    capability needs and choices;
·    the defence budget;
·    the size and composition of our uniformed and civilian workforce;
·    force disposition;
·    future challenges in supplying and sustaining deployed ADF elements;
·    Defence’s information technology needs; and, finally
·    the requirements of defence industry.

The crucial starting point for the White Paper process will be a wide-ranging review of our security environment, our strategic interests, and determining the future tasks and roles for the ADF.  Unless we start from this base, future decisions about the ADF's force structure and key defence capabilities will be neither rigorous nor disciplined.  In consultation with other agencies, Mike Pezzullo, the Deputy Secretary for the White Paper and his team have already begun this wide-ranging strategic review.

During this phase, we’ll be trying to answer a number of questions including:

·    What is the likely future role of force in the international system?  
·    What is that system going to look like in, say, 2030 - when a number of emerging major powers will have attained considerably more economic, strategic and raw military power than they currently have today, or have had in the past?
·    Will the era of major state-on-state conflict in the international system have come to an end - superseded by an era of intra-state conflict and threats from so-called non-state actors?  
·    What risks and threats will we face in the emerging strategic environment?  Will changes in the planet's climate and environment create new sources of tension and conflict?  ·    What role should our armed forces - which are largely trained and geared for war - play in any future environment.

These are the big questions the Government will need to turn its mind to over the course of the coming months.  We will need to "look through the data" as economists like to say, and discern enduring trends, risks and threats, as well as abiding interests.

Of course, getting these judgements right is the biggest challenge we collectively face.  Could anyone in this room honestly claim that when the 1987 White Paper was being developed, they predicted the collapse of the Soviet Union, or that NATO would be in Afghanistan confronting those who, in some cases at least, had fought the Soviets in the 1980s.  Or indeed that a NATO meeting would be held in Romania or Lithuania!  Once we have worked through these complex issues, the Government will be able to more confidently turn its mind to issues such as force structure and our key capability choices.  
 

The White Paper’s Force Structure Review will:
1.    identify the likely future tasks for the ADF;
2.    recommend which capabilities will be needed to undertake these tasks; and,
3.    recommend appropriate force structure and capability options to deliver these joint capabilities.  

These options will be set in the context of joint, interagency and coalition operations - and will carefully consider key issues such as concurrency, preparedness and sustainability.  
Above all, the Force Structure Review will develop options for Government for a capable, sustainable joint force which leverages the whole Defence establishment.  

Supporting the White Paper process will be a number of Companion Reviews, which will give consideration to the needs of all the supporting functions I mentioned earlier.
These functions are a crucial, though sometimes hidden, part of the Defence system. The reviews will examine the connections between each of the supporting functions and the ADF’s force structure.  

This is a very complex process because Defence is such a highly inter-connected system.  But it is also an essential task if we are to achieve - for the first time - a fully integrated Defence White Paper.

The Defence Budget and Capability Costs
Our capability choices are just as important.  Every limited dollar spent on one item of capability is a dollar not available to spend on another.  We have an obligation to get it right.

Tonight is not the time for political point-scoring.  But no serious discussion about future capability and the funding of it can be held without acknowledging at the outset that the Defence Budget is a mess and many of the capability projects we’ve inherited are more than problematic. And the cost of sustaining capability has been alarmingly under-estimated and under-funded.

This shortfall in Net Personnel and Operating Costs presents the new Government with a huge challenge. These are the costs involved in manning and sustaining our ships, tanks and aircraft - and I’m advised by my Department that the shortfall may be up to $6 billion over the coming decade.

The Howard Government was committing to new capital projects without taking proper account of their ongoing funding requirements.  It’s like factoring the cost of a new car into the family budget, without making any provision for fuel, insurance, rego or maintenance.

Putting the Defence Budget back on track and stopping waste and mismanagement in defence procurement will be big challenges for the Government but we are determined to prevail.  My Parliamentary Secretary for Defence Procurement, Greg Combet, is working very hard to make sure that we do.

At 2 percent of GDP, our current level of Defence spending may or may not be enough.  But one thing is certain, we cannot afford to waste a cent.  The opportunity-costs of a dollar well spent is a big enough challenge in itself, so anything less than optimal investment is just not good enough.

As you know we remain committed to growing the Defence Budget by 3 percent real out to 2016.  This is a big call given the inflationary environment we’ve inherited. But we will do it because as the Prime Minister says - we see Defence as “core business” for government.  But that’s not to say we won’t be looking for savings.  Indeed, given the difficulties we’ve inherited, we will need 3 percent real growth and more, and the “more” will need to come from internal efficiencies.

I have tasked my Department to carefully search out duplication and waste. There is a pressing need to save money in unnecessary overheads so that it can be reinvested in the Defence enterprise.

People Shortage
As big a challenge as these all seem, possibly the biggest challenge of all in Defence as we look ahead is our people and skills shortage. The seriousness with which this Government views that challenge is demonstrated by the fact that recruitment and retention is such a large focus for Warren Snowden the Minister for Defence Science and Personnel.

Already reaching crisis point, the need to crew three new Air Warfare Destroyers and two new amphibious ships while raising two new Army battalions, makes recruitment and retention a task of enormous proportions.

Currently the Australian Defence Force is going through one of its busiest operational periods since the end of the Vietnam War.  This year alone Defence is authorised to deploy about 3,900 personnel to nine overseas operations.  This means that up to 12,000 Defence Force members will be in the operational deployment cycle in the next twelve months - working up, deploying and the reconstituting.  Alongside this, about 550 personnel will be conducting mainland Australia and maritime protection operations.  We achieve this with a relatively small force of just over 51,000 full time members and just on 20,000 Reservists.  

The Defence Organisation is under significant pressure in maintaining this tempo and the requirement for frequent deployments is likely to continue for some years.

When I attend NATO meetings and tell them we are a Defence Force of just over 51,000 they look at me with surprise.  When I tell them that around half of our Infantry and Cavalry are currently tied to overseas deployments they respond with a look of shock and disbelief.

I’ll return to make some more comments on some of our deployments in a moment.

But first let me say that if we don’t soon begin to make more progress on the recruitment and retention front we will not be able to meet future challenges with success.  Success will require a more innovative approach on a number of fronts including producing greater incentives to stay for those currently serving.  Some of these will need to be directly financial in nature.  Others may be less direct, like our attempts to extend free medical and dental cover to Defence families.  In this strong labour market we can’t always compete on the salary front so we must find alternate initiatives for Defence families to consider as they sit around the kitchen table trying to decide whether to leave or to stay.

On the recruitment front, we must grow better at talking to Generation Y in their own language through the mediums they rely upon for their information. And we must strive to broaden our recruitment pool by sending a stronger message to women that there is room for them at the most senior levels of Defence.   All the capability in the world is no good to a defence force without the requisite people to operate and maintain it.

Consultation
On the White Paper process can I say that I firmly believe in obtaining broadly-based advice. That’s why I’ve appointed an external advisory panel to advise me on key issues relating to the White Paper. As I’ve previously announced, the panel will comprise Professor Ross Babbage, Major General (retired) Peter Abigail, and Dr Mark Thompson - and I’m pleased to see all three of them here this evening.

When I announced the White Paper, I also indicated that I would establish a community consultation panel and program to enable all Australians to contribute.  This will encourage community debate across Australia about what sort of defence force Australia should have, how it should be used, and how to best support the organisation and its people.  As we all know, a strong ADF requires strong community support - and engaging the Australian people in the White Paper process is an integral step in building their understanding and support.  

I am pleased to announce tonight that the Community Consultation Panel will be chaired by Mr Stephen Loosely.  It’s Deputy Chair will be Mr Arthur Sinodinos.  Of course, Stephen was the Deputy Chair when the consultation process was undertaken as part of the 2000 White Paper process.  He is also an ASPI Board Member and a former Chair of the Parliament’s Joint Standing Committee on Foreign Affairs, Defence and Trade. Stephen is well known for his interest in the strategic policy area and is with us tonight.  Arthur?  Well Arthur kept John Howard in office for more than a decade!  I note that Howard’s reign came to an end not long after Arthur departed. His credentials speak for themselves! The fact that he is not here tonight is my fault not his.

I will announce the balance of the Community Consultation Panel in the not-too-distant-future. I want to make sure that the representation is broad and the gender and geographical spread is right.  The Panel will consult widely with the Australian community, as well as with State Governments, relevant think-tanks, defence industry, and with the veterans’ community.  I’m really looking forward to that part of the process.

Iraq, Afghanistan and our Region
Let me return to a couple of deployment and relationship issues and then I’ll take some questions.

First, Iraq.  No doubt there are some who think our commitment to bring our combat troops home from Iraq was populist.  Nothing could be further from the truth.
There were two key drivers.  First, our concurrency issues.  Our forces are over-stretched.

As I said earlier, with substantial deployments in Iraq, Afghanistan and East Timor, and smaller but important contributions elsewhere, around half of our Infantry and Cavalry are committed.  

Our Army has a total of six battalions and our deployment numbers in Iraq, Afghanistan and East Timor roughly number three battalions.  Others are getting ready to go or reconstituting after returning home.

We urgently need to free-up numbers in order to be ready to meet contingencies which may arise closer to home.

Second, the work of our Battle Group in Iraq was complete.  In more than 18 months the Iraqi Security Forces have not required our assistance in dealing with local events.  

The new Government remains committed to Iraq and its people.  Our Security Detachment in Baghdad will stay in place.  Our ship will remain in the Gulf and our Orions will continue to fly in the region.We continue to look at what more we can do in the form of non-military assistance. But having so many people and resources tied up in an over-watch role was not sustainable.

Quickly, on Afghanistan, because you’ve no doubt heard me say it before. The Government remains committed to the project but is frustrated by the lack of progress. The Prime Minister and I travel to Bucharest in a couple of weeks and there, we will continue to push for a new road map and a greater commitment from under-committed NATO partners.  I am pleased to be able to confirm tonight that NATO has now provided us with the draft papers for Bucharest and we have been given an opportunity to feed in our views ahead of the summit.  I am hopeful of securing good outcomes in Romania but of course, as always, the effectiveness of the document will reside in its implementation. 

In our own region, we must work with our neighbours to promote stability and to build economic capacity. Both are preconditions for Australia’s continued prosperity and security.  Close to our doorstep, the ADF is playing a crucial role to create and maintain stability within Timor-Leste.  Success in this role will be essential to ensuring that the Timorese have every chance to build a cohesive and prosperous society.

Of course, the recent events in Timor-Leste demonstrate the need for Australia to retain a constructive involvement in promoting stability within our immediate region.  In the South Pacific the Prime Minister has demonstrated a clear determination to do more.  To repair relationships and to do more on the capacity building front.  Our work there must amount to more than an on-again-off-again cycle of military intervention.

We must do more in promoting good governance and economic development. The new Centre for Civil Military Co-Operation being established by my Parliamentary Secretary Mike Kelly will no doubt play a major role in developing policy ideas for the way ahead.

In conclusion, I want to say what a privilege it is to serve as Australia’s Defence Minister.  We have set for ourselves an ambitious agenda but I’m confident it’s an achievable one.   I’m fortunate to be surrounded by good people; a Prime Minister who understands Defence,strong leaders in both the CDF and Secretary, both of whom have good people behind them and are with us tonight, and of course, my Parliamentary team.

I look forward to working with you all as we embark on this journey and I wish Mike Pezzullo and his team every success in their role in guiding the White Paper Process.