Monday 28 May 2012 - Budget Estimates - Foreign Affairs, Defence and Trade Committee

Defence 

Senator LUDLAM: I have a couple of questions on what we are calling the joint force posture initiative in the Northern Territory. Is Major General Krause around-or somebody who can speak for that project?
Gen. Hurley : We can speak to it.
Senator LUDLAM: I was led to understand that Major General Krause, if this is still his gig, would be here today. Is that the case?
Air Marshal Binskin : That is right. He works for me.
Senator LUDLAM: Is it the case that he is here today? Is he able to present? It is just that he told a public meeting in Darwin that he would be.
Mr D Lewis : Perhaps you could put your question first. I do not know whether he is here or not, but we have senior officers at the table who should field the question first, and then, if it is necessary and he is indeed available, we can bring him to the table.
Senator LUDLAM: All right. Maybe we could just start with an overview, then. Can you tell us the progress towards the establishment of the first full-scale rotation? Obviously we have the marines in Darwin, as of two months already. Can you tell us how that has worked out so far, and where to from here?
Air Marshal Binskin : An initial rotation of just under 200 US marines arrived in Darwin on 3 April. That rotation is going very well at the moment. They have done a fair few training activities in the local training areas around Darwin, and it is all going as planned. We are looking at another rotation of about 200 or 250 next year, and then this will slowly grow, as has been announced, to about 2,500 in the 2016-17 time frame.
Senator LUDLAM: There was a social impact study that there has been a fair bit of debate about in the Top End. I have a copy of the issues paper here from the consultants. What is the scope of that? That is just looking at the 250. Is that correct?
Air Marshal Binskin : Currently the social impact study is looking at the initial deployment of the 200 to 250 marines. Out of that, we will do an assessment, as we will at the end of each rotation, to take the lessons from that and roll them into the planning for the next rotation as they come through.
Senator LUDLAM: So a consultant, whether it be Noetic or somebody else, will be producing one of these as the deployment scales up by a factor of 10?
Air Marshal Binskin : The aim will be, as we go through the lesson process, to see if we need to do these studies on the social and economic impacts and continue with them as we go through.
Senator LUDLAM: So as you go you might form the view that you do not need to?
Air Marshal Binskin : We will see how it goes as we step through it.
Senator LUDLAM: If people are coming to these consultants with concerns about the much larger scope of deployment, will they be ruled outside the terms of reference or will you be happy to take their views?
Air Marshal Binskin : No, if there are concerns out there then we need to address those concerns.
Senator LUDLAM: Yes, indeed-just checking. Can you tell us the total scope? One of the things that the major general told a meeting in Darwin about a month or so ago was that the US-I do not know whether it was the air force specifically-had proposed the deployment of bombers or other aircraft to Darwin and were told no, that that would not be happening. Can you describe for us the decision-making process behind that?
Air Marshal Binskin : It would be bigger than just that.
Senator LUDLAM: I just thought I would pull this thread and we will see what falls out.
Air Marshal Binskin : If I give you the history, we have had US air force, US navy and US marine aircraft rotate through Darwin. I can remember air force B52s there in 1983 onwards. So we have had these deployments over a number of years. We are cognisant of noise it creates for Darwin residents. We are good neighbours in the Darwin environment. We have Tindal down the road. So what we want to do is make sure that we spread the air activity between Darwin and Tindal.
Senator LUDLAM: Are we talking about basing here, increased rotations or business as usual?
Air Marshal Binskin : Increased rotations.
Senator LUDLAM: What kind of aircraft?
Air Marshal Binskin : From a US air force perspective, you will probably see B52s and probably fighter aircraft. You will see intelligence surveillance and reconnaissance aircraft coming through as well, including Global Hawk. So we will just continue on with the rotation. You will see all these aircraft, as we have rotated them through Australia in the past. From a marine point of view, you will see those aircraft coming through as well and predominantly helicopters, rotary wing, some V22 aircraft. Then, as part of the growing rotation of MAGTF-Marine Air Ground Task Force-you will start to see the fighter aircraft and ground attack aircraft coming through. The plan would be to put a mix of fighter and ground attack aircraft mainly at Tindal. But that does not rule out the fact that they may operate through Darwin, as we do now in pitch black exercises.
Senator LUDLAM: Are we still talking about really transient deployments, or are we starting to talk about basing? Maybe I misinterpreted what we were told in Darwin.
Air Marshal Binskin : We will see rotations of forces through.
Senator LUDLAM: How long will they be there? In a given deployment through Tindal, once this is up and running at its regular tempo, if there is such a thing, how long would aircraft be sitting there?
Air Marshal Binskin : For the rotation, as I think we have stated before on a number of occasions, we are looking at about six months of the year to put the rotations through. But there will be small headquarters units that would be there on a more permanent basis, because they are the ones coordinating in all these forces coming through.
Senator LUDLAM: Where can I find any documentation about that? As you would be aware, most of what is in the public domain relates to the US Marine Corps deployment in Darwin. Much less, I would have thought, is about Tindal. So where can we find a statement of agreement or something relating to that?
Air Marshal Binskin : That it is still evolving. The marines were the first up and we are developing the plan for the rotations with the US air force at the moment.
Senator LUDLAM: When are you likely to have something that you could present to the parliament or to the public?
Air Marshal Binskin : I will take that on notice and get the time frame back to you.
Senator LUDLAM: I got correspondence on 22 February from the member for Griffith, Kevin Rudd, who provided information to his constituents that the Brisbane River is being considered for a new submarine base as it offers a location for nuclear powered warship rated porting, which would enable visits by US nuclear subs deployed in the Asia-Pacific region. What I and a lot of people are trying to get is the scope of how big this is. It starts with a marine base in Darwin-sorry, I am not allowed to use the word 'base'-and then there is an extended air force presence at Tindal and strong rumours about an expanded presence of submarines and other vessels at Fleet Base West in WA and the Brisbane River for nuclear submarines. Where can we find a picture of what is actually under negotiation?
Gen. Hurley : That is the first I have ever heard of a nuclear submarine base in Brisbane.
Senator LUDLAM: Maybe I should not have called it a base; what about visits?
Gen. Hurley : No, no. that is the first I have ever heard of expanding facilities for nuclear submarines in Brisbane, regardless of whether it is a base or a docking site. The information would be helpful.
Senator LUDLAM: Maybe I should put that-
Senator Feeney: It is not that you are not allowed to use the term base, we are simply making the point that it is inaccurate.
Senator LUDLAM: I do not want to get into this again; we have had a few rounds of this.
Senator Feeney: If you avoid alluding to it, I will to.
Senator LUDLAM: We agree to disagree on it. After this session I will provide that letter to the CDF, and we can come back to it, if you like. So nothing for the Brisbane River, can you provide us-
Gen. Hurley : I would appreciate the letter. I was in Hawaii for the change of command from Admiral Willard to Admiral Locklear, and spent a good hour or so with the commander of the Pacific navy. The issue was not raised. I would be surprised if it was on their radar if it was not raised with me.
Senator LUDLAM: So to speak. All right, a question mark over that one; maybe we will come back to it later in the afternoon. What can you tell us about Stirling naval base in WA, where the rumour mill is running hot. Can you confirm or deny anything at all?
Gen. Hurley : Is not a matter of confirming or denying. When the announcement was made about the outcomes of the global Force Posture Review, the first two priority issues that were to be looked at were the marine rotations and the U.S. Pacific Air Force rotations. Much further into the future were, thirdly, reviewing whether or not the US Navy wanted to make greater utility of Stirling as a place for maintenance and shore rest, and, fourthly, the Cocos islands. That is where they sit at the moment. We are concentrating on the first two. Any media or other speculation about Stirling is simply that at the moment. We are not engaging intensely with the US Navy on that at the moment.
Senator LUDLAM: Not engaging intensely: how are we engaging? I will give you this from the perspective of somebody outside the bubble, who gets to find out, like most of the public, when it is announced. I approached your predecessor, the secretary and others at the table over a period of more than a year to try to establish what was under negotiation for Darwin. I was told: 'There's nothing we can tell you; it's premature to be discussing it. It's all up in the air.' Then there was an announcement. Now I am trying to work out what stage 2 looks like and whether it is going to be the same. Will the Australian people find out about these things only after they have been signed? If so, what is the scope?
Gen. Hurley : There is no scope at the moment. We have not actively looked at the expansion of US navy presence in Stirling in the terms of the Force Posture Review. It was mentioned as a third-order thing that we would look at in the future. We are not putting effort into it at the moment. We have two going, and they are taking up a lot of work as they are at the moment. We will wait until we look at Stirling in due course.
Senator LUDLAM: Will you put Cocos in the same category, if asked about that? No, let us not be hypothetical: what is the state of negotiation about Cocos?
Gen. Hurley : Cocos is not even on the horizon, in my view, at the moment. In terms of workload, I should say.
Senator LUDLAM: In terms of what, sorry?
Gen. Hurley : In working an issue there.
Senator LUDLAM: Negotiations: nothing on paper.

Gen. Hurley : No.
Senator LUDLAM: Can you tell us, after having had the ability to visit where the Australians are running two different training programs in Afghanistan, what the planning for an Australian capability is from here on? Do we propose to adopt these vehicles more widely through the ADF?
Gen. Hurley : The Shadow UAV that is operating out of Tarin Kowt is an Army capability. Once we no longer require it in Afghanistan it will come back and be part and parcel of the Army's normal capability. The Heron is operating out of Kandahar. That is run on a contract for the period we are in Afghanistan. We have no firm plans at the moment to acquire a Heron capability for Air Force in the long term, but new UAV use in the future would obviously be part of the force structure review process and the white paper process.
Senator LUDLAM: I was going to raise it with you this morning. I think I raised the next question with you in February. Would the possibility of weaponising at least the larger vehicles, the Heron, be part of that force structure review, or is it intended to retain them just as surveillance vehicles?
Gen. Hurley : We are getting a bit ahead of ourselves there. I am not sure if we can weaponise the Heron. You probably could, but we use them as an ISR platform. I think that would be the main theme at the moment. You need something slightly bigger to have any real impact. But I would not discount the fact that we might have armed UAVs, thinking through our force structure review, into the future.
Senator LUDLAM: I am trying to pin you down here. Is that under active consideration in the current force structure review, or might it hypothetically be?
Gen. Hurley : It has not been briefed to me that it is at the moment.
Air Marshal Binskin : We have not got that far in the force structure review at the moment. But it is one of those options that are out there for a future force.
Senator LUDLAM: I would imagine that it would be.
Air Marshal Binskin : Can I just correct something. You keep calling them drones. They are UAVs.
Senator LUDLAM: I have been corrected before on that.
Air Marshal Binskin : I think it was me!

CHAIR: Thank you, Senator Johnston. Senator Ludlam?
Senator LUDLAM: I have questions on different topics. You may tell me that you would prefer to deal with some of them later in the day, and that is fine. I think we have the right people to talk about the redraft of the white paper. Going first to the degree to which the public will be engaged-so, the community consultation process-I understand that community consultation around the defence white paper in 2000 was led by Andrew Peacock, that you held 28 public meetings, that you had about 2,000 participants and about 1,100 submissions. The second one was chaired by Stephen Loosely-who is a board member of a major weapons manufacturer, by the by-and there were 30 meetings where about 600 attended and about 450 groups or individuals put submissions in. The discussion paper did put forward a broader concept of security, but you could argue that not much of it found its way into the eventual white paper. Can you tell us what the plans are for direct engagement of the community this time around.
Mr D Lewis : Yes, Senator. I am not sure whether you were in the room when I was making my opening statement-
Senator LUDLAM: I have had a quick look at the copy.
Mr D Lewis : I was answering a question just after that. We are still in the throes of establishing the detail of how the white paper is going to be developed. What I can say is that it would not be right to be looking at the 2009 white paper as an inspiration in terms of how this particular paper will be addressed. It will be a different sort of paper; it is a follow-on from the work that was done in 2009-and I made some comments earlier about, for example, the Defence budget audit that was done and so forth. There was a huge amount of work; a lot of analyses and so forth went into it. That is not going to happen to the same degree in this white paper process. This is, of course, entirely a matter for the government at the end of the day, but the kind of thing that the Chief of Defence Force and I have in mind is a paper which is more concise.
To go to your point about public consultation: I do not see at this point-and this needs to be qualified by the fact that, at the end of the day, it is a government decision-the public consultation process being anything like what was done in 2009. I think it will be more concentrating on a couple of what I describe as the peak organisations-some of the think tanks, industry groups and so forth-rather than widespread public, town-hall kinds of meetings, as we saw with the 2009 white paper. A factor in my thinking around this is that public opinion was canvassed only 3½ years ago and I am not entirely convinced that we would turn up very different views from the community. So the views that were expressed back in 2009 are recorded and understood. And we are of course moving quite promptly to deliver this white paper, so I think the most efficient and effective way to do it is likely through peak bodies. As I said, my comments do need to be qualified by the fact that, at the end of the day, this is a government decision. But those are the sorts of discussions we are having right now.
Senator LUDLAM: Okay, thank you. So the view that you will put to government for their eventual decision will be that in this instance you are not going to be looking to public consultation so much as your key groups.
Mr D Lewis : I regard that in a way as public consultation. We are going to a cross-section of the peak organisations in the community-industry groups, think tanks and so forth-rather than, as I described it, the town hall kind of meeting that you might have in mind.
Senator LUDLAM: There were 30 or thereabouts last time-correct me if I am wrong on that. Are you going to hold any at all this time?
Mr D Lewis : I do not know. I would doubt it. I do not have that in mind.
Senator LUDLAM: You would be aware, of course, that in the polling that you conducted about public attitudes to defence spending there was a collapse in support for increased defence spending. That ran against the grain of the way the eventual white paper was drafted but was eventually reflected in government decision making in this last budget. Does that have anything to do with it? You said public submissions were recorded and understood. Did you give them regard? Were they incorporated into the eventual white paper or only noted?
Mr D Lewis : I am not familiar with the collapse in public support for defence spending that you are speaking about. I am sorry.
Senator LUDLAM: That was polling that was undertaken for the last white paper.
Senator Feeney: You might cite it.
Senator LUDLAM: I shall do. I will provide a copy directly after the hearing.
Senator IAN MACDONALD: Was it taken amongst Greens supporters?
Senator LUDLAM: No, it was taken amongst the Australian population, and 30 per cent of Australians in 2008 supported increased defence spending, which had fallen from 75 per cent in 2000. A number of them would have been your supporters, Senator Macdonald, not just mine. So you are not intending to conduct polling again? I should not put those words in your mouth. Do you intend-
Senator Feeney: I might intercede here, if I may. I guess what the secretary of the department is doing is giving you an insight into or an overview of the advice he will provide the minister. He will provide advice to the minister about the white paper process which the minister will then obviously deliberate over. So I guess what you are getting is a preview of the sinking of the secretary, but obviously the minister has not yet received that advice nor made a determination.
Senator LUDLAM: I appreciate the secretary's advice as preliminary draft views that will be put to the minister. I will put the question to you, Senator Feeney, as to whether the government intends to conduct polling, as you did last time, on attitudes to defence spending amongst the broad community.
Senator Feeney: That is a decision that will be made by the minister. It is not a decision for me.
Senator LUDLAM: It is not a question on notice. Could you take it as a proposal on notice?
Senator Feeney: By all means.
Senator LUDLAM: Thank you. Secretary, I apologise for missing your opening statement. You noted the force structure review is one of the input documents, if you will, to the white paper. Can you step through for me how that is intended to work? I would have thought that force structures were determined by the high-level strategic guidance provided by a white paper, not the other way around. Step us through which document informs the other.
Mr D Lewis : There is a golden thread of logic that most white papers follow, and that is you start with your strategic assessment of the situation in which Australia considers itself to be internationally, in the international community. Then, working forward logically from that, you look at your strategic circumstance, which includes the ability of the country to pay for certain defence capabilities and look into the specific capabilities that are required. From the capability comes the detailed force structure. I will invite the CDF in a moment to add some words about the force structure review, but that piece of work began in November last year, quite separate to the issue of a white paper. We will not uncommonly revisit force structure between white papers. That piece of work began, as I say, independent of the white paper process in November and it will continue on to its natural conclusion, but it will feed-just by serendipity, if you like-directly into the white paper. So there is a coincidence of timing, essentially. That piece of work is not complete and it will be informed in a synergistic way by some of the judgments and so forth coming out of the white paper.
Gen. Hurley : There is not much more I can add to that. We commenced the force structure review, as the secretary said, late last year. We have done about six months work on it, obviously. We will need to take into account now what issues come out through the white paper considerations. That is not to say that what we have done to date is invalid, but that will certainly give indicators and points for thought that we will need to come back to as we look to the future. There will be more work to be done in parallel with the white paper process. It is not necessarily a directly linear process because there have to be some feedback groups saying, 'We are thinking this way and these are the implications for force structure. If you do this for force structure what can you achieve strategically? What is the best way?' So there is an interaction as the process goes through.
Senator LUDLAM: That is what I was trying to get to. It sounds as though the people drafting the white paper might find it quite helpful that that review is underway at the same time. Before I move away from that topic, for the thousands of people who did participate at various times-just members of the general public who are interested in defence policy, and I admit that it is probably not widespread throughout the community but it is there-will you be inviting public submissions? Will there at least be a post box if you are not planning on holding meetings? I gather that you have gone off that idea. How will people be invited to participate, if at all, if they are not part of one of the peak bodies that you would be inviting?
Mr D Lewis : I do not think I can address that question at this point. I have not turned my mind to the detail of how that might be affected. You asked a question earlier about whether there would be widespread public consultation in the very demonstrable way that you saw last time. My answer to that is no. I do not really have an answer at this stage on how we will go about it. It may be that it goes to that sort of mechanism. There may be some other solution to it. I cannot give you an answer.
Senator LUDLAM: I recognise, again, this might stray into policy, but are you interested in the views of the public as it regards defence policy?
Mr D Lewis : Of course.
Senator LUDLAM: But you will not be seeking such views?
Mr D Lewis : What I am saying is that through the peak bodies we are able to get, in my view, a very helpful insight into what the view is outside of the Defence department about what we should be doing.
Senator LUDLAM: What sort of peak bodies are you talking about in this instance?
Mr D Lewis : Think tanks, the Australian defence industry group and so forth.
Senator LUDLAM: They are not representative of the Australian community; they are representative of defence industry interests. Can you give us some examples of what you mean by peak bodies representing popular opinion with regard to defence policy?
Senator Feeney: Some of these peak bodies are self-selecting. They are comprised of people from the Australian community interested in defence matters. The Kokoda Foundation is perhaps an example of that. But it was made plain at the beginning of the day that the white paper time line that has been foreshadowed-which is the first part of next year-is by any measure a very short time line. And so I am sure that when the secretary is talking to you about what is realistically going to be proposed by the department to the minister he is being acutely mindful of the fact that that time line is compressed.
Senator LUDLAM: We cut a year off what they expected they would have. One of the areas in the last white paper in 2009 that attracted a degree of criticism was the way in which nuclear weapons policy was addressed, that it was treated as an unambiguous good that we are part of the United States nuclear weapons umbrella. This is an issue which does have some resonance and interest within the public. Can you tell us whether that issue is on the table, how that will be reviewed and how people can have some input into that.
Mr D Lewis : I think the longstanding arrangements that we have with our major ally, the United States, which of course includes the matter of the US's nuclear capability and the umbrella that that provides to its allies are well understood and well known through the community. I am not sure that I can specifically answer your question with regard to this white paper and the nuclear capabilities of the United States. If you are referring to our own policies around that-
Senator LUDLAM: Yes, I am.
Mr D Lewis : then that will be considered obviously as part of the white paper process.
Senator LUDLAM: I am not asking you from Canberra to unpick US strategic doctrine with regard to nuclear weapons, but in Australian defence policy there either is or is not a role for nuclear weapons for if Australia is placed under some threat where we therefore approve or endorse the use of these weapons in Australia's defence. I am asking whether that notion is up for review and in what kind of forum or template.
Mr D Lewis : I think Australia's position on this is very clear, Senator: we have been the beneficiary of a United States nuclear umbrella for most of my working life.
Senator LUDLAM: A 'beneficiary'? That is an unusual term-is that a term of art with the defence community?
Mr D Lewis : That is how I describe it, Senator. You may have a different view-
Senator LUDLAM: I do.
Mr D Lewis : but I regard it as something which has been essentially advantageous for the security of this country in either direct or indirect ways.
Senator Feeney: Perhaps I can assist here. I think it is fair to say, without prejudging decisions that will be made by the minister, that those foundation stones of strategic guidance that were found in previous white papers, and are likely to be found in future white papers, are consistent with government policy and the policy that has been articulated from time to time when these matters have arisen.
Senator LUDLAM: Senator Feeney, it is government policy to abolish these weapons. How can we be the beneficiaries of something that we are seeking quite actively, and with strong popular support, to abolish?
Senator Feeney: Senator, the ANZUS treaty, and the arrangements that Australia has had with the United States on a longstanding basis, are not likely to be reviewed or revolutionised-
Senator LUDLAM: Does the ANZUS treaty explicitly-
Senator Feeney: Just let me finish, Senator. I do not think the future white paper is likely to be a vehicle to revisit or review those arrangements.
Senator LUDLAM: Does the ANZUS treaty actually explicitly mention the existence of nuclear weapons at all?
Senator Feeney: Not to my knowledge.
Senator LUDLAM: No, mine either-so I am not sure why you invoked that.
CHAIR: Senator Ludlam, we are into questions arising from the opening statements.
Senator LUDLAM: Maybe this is getting a little specific.
CHAIR: Perhaps you could direct your questions to the opening statements.
Senator LUDLAM: I will leave the white paper matters there. Is this an appropriate moment to speak of the withdrawal process from Afghanistan and some recent moves in that area? I just wonder whether you can update us on the force transition team that I understand comprises up to 250-odd ADF personnel for 'planning and coordinating Australia's transition from a provisional focus based in Oruzgan to a national focus based in Kabul'. First of all, I want to know whether that is an accurate assessment of what that team does, and whether you could provide us with an update on its activities.
Gen. Hurley : In the transition process, running from now, is the formal process between NATO, ISAF and the Afghan government to be completed at the end of 2014. As you are aware there are five tranches in which lead responsibility is transferred to the Afghan national security forces. We are in tranche 3. As we enter that tranche, obviously the nature of our contribution to the operation in Afghanistan, and Oruzgan province in particular, starts to change. Part of that change will be a reduction in our numbers of personnel there over time. As those numbers reduce, and we get to the point at the end of 2014 where we are no longer required to be in Tarin Kowt in a substantial way, we need to move all our equipment back to Australia. That task will be conducted by this group you are referring to-200 or so; we have not settled on the numbers yet-and they come in because they are primarily specifically logistically qualified personnel who are responsible for the final accounting, preparation of equipment for extraction, managing the equipment back to Australia and then closing off accounts and so forth in Australia as that part of the operation winds down. So their particular job is not so much focused on establishing us in Kabul or elsewhere-though they can assist, if required; and, again, we are still working through the planning on this-but they are essentially a force there to help us extract our equipment from Afghanistan.
Senator LUDLAM: Okay. Who is the officer in command of that team?
Gen. Hurley : There is nobody in command of that team yet because it has not been formed.
Senator LUDLAM: It has not been stood up; okay.
Gen. Hurley : I think I saw a reference to your question the other day. There is a brigadier who has been sent over to assist with the planning of that, and so with responsibility to do a full accounting of the equipment we have there; think through the priorities for extraction in relation to the operational plan, the tactical plan and so forth; and provide advice back to the Chief of Joint Operations about how we might go about extracting our equipment. As to whether that person then becomes the leader of that group, we will make a decision later.
Senator LUDLAM: That is Brigadier Gallasch?
Gen. Hurley : Yes.
Senator LUDLAM: Okay. I will put that through to you on notice. I recently had the good fortune to visit Kandahar and Tarin Kowt. She was everywhere that we were not, so I was hoping that we might be able to catch her at this session. So the transition team that I mentioned has not yet been formally stood up?
General Hurley : No.
Senator LUDLAM: Does she have staff assisting her?
General Hurley : She has a small number of staff-planners and so forth-with her at the moment.
Senator LUDLAM: Are we going to face fairly serious quarantine issues when we come to importing a huge body of equipment back to the country?
General Hurley : Obviously, that is one of the very important issues that we look at as we bring our equipment back in. Negotiating and discussing with the quarantine service exactly what will need to be done where will be part and parcel of the process. Extracting the equipment and bringing it not only into Australia but also through other countries needs to be thought through in these terms.
Senator LUDLAM: It is envisaged that by the end of that process that we will still have a presence in Kandahar?
General Hurley : I hesitate, because all that planning is not complete. Probably not, I would think. We would more than likely be Kabul based than Kandahar based.
Senator LUDLAM: Okay. Maybe we are drifting into hypotheticals here.
General Hurley : Yes. There is still work to be done.
Senator LUDLAM: CDF, could that brigadier or whoever has subsequently been placed in charge of that taskforce when it gets formed be present for the next budget estimates session a bit later in the year?
General Hurley : What questions would you like to ask?
Senator LUDLAM: That would be hypothetical. We do not do hypothetical questions.
General Hurley : I am responsible for the operation of the ADF, though, Senator, and that would be part and parcel of a much grander plan than just extraction. I normally take all the operations based questions at Senate estimates.
Senator Feeney: The reason that those questions are not being answered now, as the CDF has said, is not because of the absence of that brigadier but rather because those decisions have not been made and the group has not been stood up.
Senator LUDLAM: Has the Prime Minister's announcement in her speech at ASPI a couple of weeks ago and developments in Chicago since then caused you or her or that team, such as it is, to bring forward any of their planning for the withdrawal of our presence there?
General Hurley : No. This is an often held misapprehension of what is occurring. The foundation for the transition planning to transfer responsibility to Afghanistan for its own security was laid in Lisbon a number of years back. It had a timeframe and a number of tranches. We are moving through those tranches. At the time of Lisbon, we were not quite sure which tranche we were in. We could have been tranche 1 or tranche 5. It is difficult to say whether we are accelerating or not when two years ago we did not know when our province would be transitioned. We are now aware, obviously, that we are in tranche 3. That tells us that within 12 to 18 months, provided that conditions are appropriate, we will have moved lead responsibility for security to the Afghan national security forces in Oruzgan. It does not mean that we will get up and leave in that timeframe, because we will still provide some advice and support and so forth and will have extraction people still in Oruzgan working through until the end of 2014. It is not an acceleration or getting out early; it is simply marching to the beat of the plan. We have been told now which tranche we are in so we now the timeframe for the extraction of equipment and the transition of effort, depending on what the government says that we are to do post 2014.
Senator LUDLAM: Perhaps, CDF, some of that confusion has been generated by the Prime Minister telling the country on national TV that we would be out 12 months before we expected to be. That is where some of the confusion might stem from, perhaps.
General Hurley : The speech that the Prime Minister gave was quite clear. The confusion may have arisen over the incident when we went to NATO in April. Without exception, every nation's representative who asked, What has happened in Australia?' said that after they read the speech they understood what was actually said. They were quite clear.
CHAIR: We will now suspend for lunch.

Senator LUDLAM: Senator Johnston had a pretty good go on the submarines issue and I have a couple of follow-ups, mainly on the additional $214 million needed for initial consideration, detailed studies and analysis of future submarine capability. What exactly does the $214 million buy us, because that is a spectacularly expensive scoping study?
Mr King : We answered that in part. It is an awful lot of money, but against billions of dollars in investment it is actually not spectacular. I do not want to diminish the amount of funding; it is a significant amount of funding. If, for example, you look at the Kinnaird review of how we go about procurement it suggested, based on industry best practice that anything up to 10 per cent of a project's funds could be expended in what I will call the feasibility phase as an appropriate investment of funds to identify your risks for the actual project phase. By way of example, on the AWD project we were looking at both a new design and existing design. I think we spent in the order of $220-odd million in looking at new design work-what it would take to equip a shipyard, costs and so on. That informed the decision that we went back to government with. This work will look broadly at things like existing designs and capability trade-off studies. You will have seen a lot of debate in the general press about how much a military off-the-shelf submarine costs, how much a new design costs, how long it will take to build and what your risks are. It is surprising how much you learn when you actually do the studies and find out, compared with imagining what it might be. I can get a detailed list of all the studies we are intending to do, but broadly it is developing enough knowledge and information to inform the government of the span of likely costs and likely risks and to allow them to make, at least on this occasion, a first-pass decision.
Senator LUDLAM: This is probably something you already canvassed, but does it limit the scope of that study that we have already decided that the fabrication, at least, is going to occur in Australia?
Mr King : I think there are only two significant limitations, as I understand it: that it not be nuclear propulsion and that it be assembled in South Australia.
Senator LUDLAM: All right; you pre-empted my next question. ASPI's paper 57 says that the government should quietly-whatever that means-approach the US about the possibility of nuclear submarine timing and the costs of any such program.
Senator Feeney: Yes, the government has ruled that out.
Senator LUDLAM: Loudly.
Senator Feeney: Perhaps not quietly, no. It has emerged in debate on several occasions over the last couple of years, and on each occasion the government has ruled it out.
Senator LUDLAM: So I can confirm with you that you have not quietly approached the US as ASPI is advocating?
Senator Feeney: I can confirm that for you, yes.
Senator LUDLAM: That is unusually straight language. That is good; thank you. So the two things are fabrication in Australia and non-nuclear propulsion. Perhaps you could just spell out for us, as succinctly as you can, why we have precluded from that $200 million study, or thereabouts, the option of simply buying some of the other models-and Senator Johnston named some of them-straight off the shelf and putting them to sea.
Vice Adm. Griggs : That is part of the study.
Senator LUDLAM: But we will be building them here. We are not going to buy existing vessels or have them fabricated in a yard overseas.
Vice Adm. Griggs : No, that is true.
Mr King : The guidance is 'assembled in Australia', but there are four streams of options we are looking at. One is what we call military off the shelf. Then we have the adaptation of that to Australian requirements for things like combat systems that might be unique. Then there is extension of Collins, and then there is a brand new design. We will be looking at the cost schedule, risk and capability trade-offs of all of those.
Senator LUDLAM: Is it oversimplifying to say that one of the reasons we need such a large vessel is that it is not, strictly speaking, for protection of sea lanes around Australia or our maritime traffic in our EEZ; it is about being able to reach, for example, the South China Sea, and that is why some advocates are proposing a nuclear submarine? It gives you the range, whereas if it is a diesel powered vessel you need a much bigger boat. Is that the reason we pursue such large vessels here in Australia, and why some of the submarines produced by other countries are not necessarily appropriate?
Vice Adm. Griggs : It is all related to our geo-strategic circumstances. There is a misconception, I think, amongst some that submarines sit around your home port and defend your home port. That is probably the most inefficient and pointless use of a submarine that you can imagine. Submarines need to be forward, whether that be at a choke point or in a particular focal area where you might be conducting operations or, importantly, near your adversary's home port.
Senator LUDLAM: Who is our adversary in this instance?
Vice Adm. Griggs : It is a generic term. I am not going to label a particular country. But in generic terms your submarine is operating best when it is forward. A submarine is designed primarily for two things: antisubmarine warfare, or submarine on submarine, and antisurface warfare. In the antisubmarine warfare role the best place to remove the threat is as it is coming out of its home port.
Senator Feeney: I might just add to that and try to paint the picture for you. If you imagine a European submarine that is designed to patrol the Skagerrak or the Baltic Sea and then transplant that to an Australian environment, you would very quickly see the tyranny of distance impose itself. From our industrial and port facilities in the southern part of Australia to the primary operational environment in the north of Australia there are distances involved that would confound a European or Mediterranean perspective. One of the great issues at hand here is range.
Senator LUDLAM: My proposition, which I put to you directly, is whether we need to send these vessels much further afield than our territorial waters-I am not talking about their home port. Do we need to be able to project this kind of capability into, for example, the South China Sea.
Senator Feeney: Even if you are just manoeuvring around the maritime environs of Australia you are transiting distances that are greater than the whole of Europe. Even if you look at moving from Stirling to the north-east shelf, let alone transiting to Sydney or the south-western Pacific-I am not suggesting any particular scenarios or pointing at any particular environs-you can see that moving around Australia is a task that has unique requirements.
Senator LUDLAM: I think we are edging towards a yes as the answer to my question. That is pushing us towards larger vessels.
Senator Feeney: I do not want to start nominating scenarios or contingencies.
Vice Adm. Griggs : Our geostrategic circumstances-the distances involved-drive us towards a larger submarine. It has in the past; the Oberon class was a large conventional boat for its day and Collins was one of the largest conventional boats of its day.
Senator LUDLAM: Indeed. I do not want to get into too much detail here, but are you contemplating, for example, basing them in the north-west, at Dampier or Darwin, or somewhere in North Queensland, which buys you the range, rather than building huge vessels?
Vice Adm. Griggs : There are some significant practical limitations on home-porting submarines in the north. Something as simple as tidal range is a significant issue in maintaining a vessel that is alongside a wharf.
Senator IAN MACDONALD: There are a lot of big tides in Townsville.
Senator Feeney: Those are decisions that might flow from a decision about what sort of submarine we buy, which is a decision that will flow from-
Senator LUDLAM: Yes, but Senator Macdonald is quite right.
Senator Feeney: You are going a long way down the road.
Senator LUDLAM: I am trying to work out whether these things are in the mix. Have we already decided that we are buying a vessel that will be amongst the largest of its day-that is, the 2020s or the 2030s-
Senator Feeney: No, we haven't.
Senator LUDLAM: because it is assumed that it is going to be coming from a southern home port?
Mr King : I think the experience that we got from AWD and spending money looking at capability trade-offs and at all the matters that relate to operations-cost and size-played out very effectively because we collected data and information, we logically catalogued it and we brought that to the attention of government. We are planning exactly the same with this project, except that it is a larger project, it is more complex and it requires a lot of thought. I am absolutely certain it will not be just one or two passes to government. There will be a series of decisions that this and subsequent governments will have to make on how we progress the project.
Senator LUDLAM: I would certainly hope so. Have we set on 12 as the number of units that we will be buying or is that in the mix as well?
Vice Adm. Jones : Twelve is in the white paper for 2009.
Senator LUDLAM: We are redrawing the white paper.
Vice Adm. Jones : Indeed.
Senator Feeney: That is the strategic guidance at the moment.
Senator LUDLAM: So that is in the mix.
Senator Feeney: No, the strategic guidance at the moment is 12.
Senator LUDLAM: What if the 2013 white paper says maybe not 12? Is that question being revisited or not?
Senator Feeney: This not an estimates into future white papers.
Senator LUDLAM: It was, earlier in the day. What I am trying to ask is: are we going to build 12, or is that number potentially in the balance. We have been talking all sorts of other considerations that are also hypothetical.
Vice Adm. Jones : The DCP reflects the white paper of the day.
Senator LUDLAM: Okay. Thanks, Chair.