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Exploring a new approach to Defence spending

Was the Commonwealth government’s recent purchase of an enhanced fleet of Abrams tanks a good use of a funding “windfall”?

Was the Commonwealth government’s recent purchase of an enhanced fleet of Abrams tanks a good use of a funding “windfall”?

Earlier this month, Minister for Defence Peter Dutton confirmed the government will push ahead with its planned acquisition of 75 M1A2 SEPv3 Abrams Main Battle Tanks under the LAND 907 Phase 2 project following approval from the federal cabinet.   

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A separate order for 29 M1150 Assault Breacher Vehicles (ABVs), 17 M1074 Joint Assault Bridges (JABs), six M88A2 Hercules Combat Recovery Vehicles and 122 AGT1500 gas turbine engines as part of LAND 8160 Phase 1 was also confirmed.

The M1A2 SEPv3 Main Battle Tanks are expected to upgrade the existing fleet, with no changes to the Royal Australian Armoured Corps force structure. 

The M88A2 vehicles are to provide additional de-processing and combat vehicle recovery support for the current fleet, while the M1150 ABVs and M1074 JABs deliver new capability to the Royal Australian Engineers.

Meanwhile, the ABVs and JABs are tipped to deliver under-armour bridging and breaching capability, in a bid to increase the effectiveness and survivability of Australian combat engineers and provide increased mobility for the armoured fleet. 

The order, placed as a foreign military sale, is valued at approximately $3.5 billion.

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A month earlier, Hanwha Defense Australia officially signed a contract with the Commonwealth for the supply of Huntsman AS9 self-propelled artillery systems to the Australian Army as part of the LAND 8116 Phase 1 program — a $900 million-$1.3 billion procurement of 30 self-propelled artillery systems and 15 armoured ammunition resupply vehicles.

According to Lesley Seebeck, an honorary professor at the Australian National University and an independent consultant on strategy, technology and policy, this “windfall” has been funded by cost savings associated with the cancellation of Naval Group’s Attack Class contract in lieu of the decision to develop nuclear-powered submarines under the AUKUS arrangement.

“More may be forthcoming before the costs of the nuclear-powered submarine program kick in — government reporting offers little insight into the mechanics of internal budgeting,” she writes in ASPI’s The Strategist.

“But it’s likely that the overall defence capability development program is being shuffled to manage adjustments to the submarine program and allow for ever-present slippage, compounded by effects of COVID-19 and supply-chain shortages.”

According to Seebeck, funds should have been invested in long-term efforts to bolster defence capability.

“A windfall is rare. It should be treated as an opportunity to seed long-term assets, not simply as a chance to juggle the existing order books,” she writes.

Seebeck notes that long timescale inherent in capability development would require “sustained, assured funding lines”.

“Designing and building a submarine — one of the most complex engineering tasks on the planet — takes around 10 years for the first of class,” she writes.

“Each vessel must be sustained and upgraded through 40 to 50 years of operational life, as will be likely for the Collins Class submarines. The US Air Force still operates B-52 bombers, now 60 years old. With their ‘good bones’, upgrades will see them out another five to 10 years.

“It’s not just hardware that needs long-term investment. People and organisations need the skills, knowledge, practice and culture to build, operate, manage and sustain such kit. That takes time to realise and mature: seven years to train and season an engineer, for example. Start-ups typically need around seven years to gain traction. Institutions form over decades.”

The defence analyst also reflects on the long-term processes involved in defence research and development.

“Take lasers, a deep technology underpinning the modern economy and military. Albert Einstein first postulated the theory behind lasers in 1917,” Seebeck continues.

“It was 43 years before the first operational laser materialised in 1960, then more than 10 years before the first commercial and military uses — barcode scanners and rangefinders.

“It’s now hard to think of an industry that doesn’t make use of lasers in some form, and there’s a broad ecosystem supporting their development, commercialisation and use.”

Seebeck acknowledges the shift in the geostrategic environment, which has likely forced a rethink of the Commonwealth government’s long-held defence capability strategy.

“Australian governments are accustomed to making expensive, long-term commitments to major capability development,” she writes.

“Those investments followed, roughly, a strategic logic that had been in place since the 1980s and a funding model of the 1990s and early 2000s. They reinforced an established view of military practice and contributed to an industry ecosystem geared to a particular way of working, with particular skill sets and capacities.

“But in the current strategic environment, the old settings aren’t enough: an assertive, authoritarian China and new technologies are challenging geopolitical balances, force structures and doctrine. Fast change is needed.”

Seebeck welcomes the first key shift in the government’s strategy, the AUKUS deal.

But the development of nuclear-powered submarines to replace the ageing Collins Class fleet would be, according to Seebeck, “insufficient”.

The analyst urges government to “reinforce the thinking behind AUKUS” and focus on developing capability in “new and emerging technologies.

“Increased investment — slow, patient capital — is required to develop and mature technology, industries, institutions and people,” she writes.

“It’s not enough to privilege such development within the bounds of the military services or the wider defence ecosystem.”

Seebeck adds that given the growing threat posed by China in the region, Canberra should consider Australia’s defensive posture — the survivability of existing and future assets, including infrastructure.

“Investment, not more laws, is needed to harden Australia’s data and digital infrastructure, for example. At least as much attention is needed on the defensive side as is being directed to offensive capability,” the ANU professor notes.

Seebeck ends by stressing the need for a coherent strategy for Australia’s new geopolitical circumstances.

“That will help us set priorities, sustain the funding needed for the hard slog of change and capability development, and build bipartisan commitment to a coherent defence posture that protects our national interests,” Seebeck concludes.

Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia's political leaders in terms of partisan and bipartisan agenda setting in the comments section below, or get in touch with This email address is being protected from spambots. You need JavaScript enabled to view it., This email address is being protected from spambots. You need JavaScript enabled to view it., or at This email address is being protected from spambots. You need JavaScript enabled to view it..

Exploring a new approach to Defence spending
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