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Acting Prime Minister and Defence Minister Richard Marles and Defence Industry Minister Pat Conroy have announced a new look Defence bureaucracy to tackle the nation’s growing defence acquisition pipeline.
The Albanese government has announced its most sweeping overhaul of Defence procurement in decades, unveiling plans for a new agency designed to tighten project delivery, strengthen accountability and ensure Australia gets maximum value from its record defence investment.
The reforms, framed as essential to meeting Australia’s increasingly complex strategic environment, will see the creation of a stand-alone Defence Delivery Agency, tasked with streamlining how the nation buys, builds and sustains military capability.
Minister Marles stressed the importance of standing up the Defence Delivery Agency, saying, “The establishment of the Defence Delivery Agency will elevate the professionalism and strategic focus of Defence capability acquisition and sustainment. It will drive stronger contestability, more accurate cost estimation, and clearer accountability for the delivery of major projects.”
Since coming to office in May 2022, the government has committed an extra $70 billion over the decade, the largest peacetime boost to defence spending in Australian history. Much of that funding is earmarked for major acquisition and sustainment programs, placing intense pressure on Defence to deliver outcomes on time and on budget.
The acting Prime Minister added, “As the Albanese government makes the biggest ever peacetime investment in Defence, it is important that we put in place the structures and systems to ensure Australia’s Defence Force can deliver the capabilities we need at speed and within budget.”
Under the changes, the new agency will consolidate three of Defence’s most important capability-delivery groups: the Capability Acquisition and Sustainment Group, the Guided Weapons and Explosive Ordnance Group, and the Naval Shipbuilding and Sustainment Group.
Supporting this, a newly appointed National Armaments director will head the agency, advising government on acquisition strategies and overseeing the delivery of major capability and sustainment projects once approved by cabinet.
By merging them under one structure with its own budget authority, the government aims to cut internal duplication, accelerate delivery schedules, and strengthen the national defence industrial base.
Crucially, the agency will report directly to ministers, an elevation designed to provide clearer lines of accountability for multi-billion-dollar procurement programs that are central to Australia’s future deterrence posture.
Minister Conroy expanded on the acting Prime Minister’s statement, saying, “The increasing complexity of Defence capabilities, systems and platforms requires a systematic rethink of the capability development and delivery system. This is about setting Defence up for success so we can modernise the ADF in line with the National Defence Strategy, while ensuring we spend taxpayers’ money wisely.”
In tandem with the procurement overhaul, Defence will centralise its capability development functions, tightening how new proposals are assessed, prioritised and integrated across the Australian Defence Force. The government said this will ensure investment decisions are aligned with an increasingly focused, integrated force design.
The reforms are expected to deliver stronger project and budget discipline, sharper cost estimation, and improved oversight across the full life cycle of defence capability.
Work on designing and standing up the Defence Delivery Agency will begin immediately, with extensive consultation planned across industry and other stakeholders, recognising the critical role of Australian industry in delivering sovereign capability.
Minister Conroy added, “The new agency will help ensure our industrial base is resilient, innovative and aligned with our strategic priorities. It will create more opportunities for Australian businesses and workers to contribute to Australia’s national security.”
The government said the overhaul builds on earlier improvements made since 2022 and is aimed squarely at ensuring the ADF has the tools, technology and industrial backing needed to safeguard Australia in a rapidly changing strategic environment.
More to come.
Stephen Kuper
Steve has an extensive career across government, defence industry and advocacy, having previously worked for cabinet ministers at both Federal and State levels.
