PRIME MINISTER:
Well ladies and gentlemen, I'm delighted to be here today with the French Minister for Defence, Monsieur Le Drian, the Australian Minister for Defence Industry, Christopher Pyne, to sign the inter-governmental agreement between the Commonwealth of Australia and the Republic of France for the design and construction of 12 submarines, regionally superior submarines.
This is a critically important step in the development of our security, in the assurance of our government in delivering Australians the security and the prosperity that they need.
What we are doing today is 100 years on from the days when French soldiers, Australian diggers were fighting side by side to defend France's freedom, and today in the Middle East, France and Australia are working together to battle the threat of terrorism.
Now we are working together once again to ensure that Australia has the capability, the sovereignty - this will be a sovereign defence industry, a sovereign submarine capability here in Australia, centered here in Adelaide, but with a supply chain that stretches across the nation, creating 2,800 jobs at the very cutting edge of technology.
The entirety of our defence industry plan, the entirety of our naval ship-building plan, of which this is the largest component, will ensure that Australian industry, Australian advanced manufacturing is at the very forefront of technology, a key element. Not simply in terms of the development and the assurance of our national security capability, but in the delivery of our economic plan. Because our future, our assurance, our security as a first world, high-wage, generous social welfare net economy depends upon the technology, the innovation, the skills that come from investment such as this. This is a key element in our economic plan and we are delivering it, just as we said we would.
The Defence White Paper, the Defence Industry Plan earlier in the year, step by step, as the Minister will describe, he and Minister Payne have succeeded in putting together the elements that will ensure that we have the jobs, we have the skills, we have the technology and above all we have the capability to ensure Australia is safe in the years ahead.
We live in challenging times, the security environment is uncertain around the world and that is why we are re-equipping our Navy and our defence forces right across the three services and the cyber sphere, ensuring we have the capabilities to keep Australians safe in times that are more challenging than we have known for many years. Before I invite the Minister to address us, I want to make some remarks about the events overnight in Berlin and in Turkey.
The Australian Government utterly condemns the attack in Berlin overnight where we understand there has been 9 deaths and over 50 injured. We also condemn the cowardly assassination of the Russian Ambassador to Turkey.
We have seen a series of large terrorist attacks, mass casualty terrorist attacks in recent weeks: in Nigeria, in Yemen, in Istanbul, in Somalia, in Cairo, in Jordan over the weekend another attack, and last night in Berlin.
I’ve spoken to the Foreign Minister, the Justice Minister, I've spoken to the heads of ASIO, the AFP and our Counter-Terrorism Coordinator and we have established that the embassy staff in Berlin are all accounted for. There were no Australians affected by the attack in Turkey. I've been in touch with our Ambassadors in both capitals.
We are also intensifying the steps that we have already set in place to ensure that we have the protective measures to respond to attacks such as that that we've seen in Berlin. As you know, this was a truck attack. This appears to be a similar type of attack to that in Nice earlier in the year. Following that attack I tasked my Counter-Terrorism Coordinator to review all of our measures to protect mass attendance events from attacks like this and we have been working with the state and territory police forces to that end.
Speaking to the Federal Police Commissioner this morning, Andrew Colvin, he has already been in touch with his counterparts in the states and is ensuring that they are - everyone is well prepared to anticipate attacks of this kind.
I want to say that while we can reassure Australians that we have finest police and security forces in the world, that we are keenly focused on keeping Australians safe, whether they are at a market or a New Year's Eve celebration, wherever they may be, nonetheless we cannot mitigate all risk entirely. But we are working night and day to keep Australians safe and we are very attentive to events internationally, to ensure that we learn from them and make sure that we put measures in place to anticipate similar occurrences here.
We've also of course, reached out to the Russian, Turkish and German diplomatic community here in Australia in terms of their protection and I want to conclude again, on behalf of the Australian Government, we send our condolences to the families of those who have been killed in Berlin and the earlier attacks that I mentioned and also our deepest sympathy to those that have been injured and our very best wishes for a speedy recovery.
JEAN-YVES LE DRIEN:
[Speaks French]
INTERPRETER:
Prime Minister, Minister Pyne, I'm particularly pleased to be here with you today in Adelaide for the signing of the inter-governmental agreement which is the background for the relationship between our states, France and Australia, in the light of the implementation of the Australian program for the future submarines.
In announcing on 26th April this year that DCNS had been chosen as the partner for the implementation of this program, not only did Australia choose a French company of high standards and quality that is capable of building these extremely complex products which are really exceptional submarines, 4,000 tonne submarines. But Australia also chose France, and I would like to reassure you, Prime Minister, that DCNS is not a business like any other.
Because DCNS is a business that ensures the sovereignty of France because it builds these submarines that actually ensure our security and this is a very important act to ensure that this business that ensures France's sovereignty would tomorrow become the partner for Australia's sovereignty, and this is what I think is the major meaning behind this agreement. Because in reality, we have a very strategic partnership, and this partnership shows - and this is a partnership that we want to put in the service of international security, as you mentioned a minute ago, the new threats that are resting on us and exposing our security.
It is in the interests of France and its allies that Australia should be equipped with naval capacity, the best capacity and it is in this mindset that we wish to work with you. The submarine contract that unites us for, say, 50 years, over 50 years, will most certainly be a very essential element of this partnership.
But this partnership goes beyond this. Our Navies already work together, just like our Air Forces work together in the campaign against Daesh in the Middle East. It is together that we regularly come to the help of the island states in the Pacific when a natural disaster strikes them. As France is also a nation in the Pacific region. Ships regularly stopover in Perth and Sydney, but also in Singapore, so there is a lot we can build together.
But our relationship will also be an industrial one. It is important to say this here in Adelaide, in the area where these submarines, these Australian submarines will be built. We will soon take part in the inauguration of the DCNS offices in Adelaide which showcases that things are really progressing very quickly and in Cherbourg there is quite a few Australians who have started to work with our teams on the initial design phase for the future submarines.
And this program is therefore an opportunity for Adelaide, but also an opportunity for Cherbourg since the trades, very high-technical demanding skills need to be developed here as well.
So I am delighted about this partnership, about this signature today, and I would like to thank my colleague Marise Payne and Christopher Pyne for their involvement and determination in support of this successful achievement.
We are currently laying the first stone, the first pillar of a construct that will survive us for decades to come in the service of our security, of our partnership and of our commitment vis-a-vis the international security and for the security of our respective countries. Thank you very much.
MINISTER FOR DEFENCE INDUSTRY:
Well, just to add a couple comments, it is a great pleasure to be here with one of my older friends in the Prime Minister, Malcolm Turnbull, but also with my new friend, the Minister for Defence, Jean-Yves Le Drian from France. We actually caught up last week when I was in Paris, had dinner together at his palace. Not a bad suggestion in fact for Australian Ministers perhaps to have a similar facility available to them in Canberra, but perhaps that's something we will discuss privately, Malcolm and I in the months ahead.
PRIME MINISTER:
No chance.
MINISTER FOR DEFENCE INDUSTRY:
Well that was a quick discussion but never the less, now we know where he stands. But it was a great pleasure to have dinner with Jean-Yves last week and ensure that this project remains very much on schedule and today is another red-letter day in the $50 billion 12 submarine project. We are remaining on schedule. We are reaching all our milestones. So today we’ve signed the intergovernmental agreement between France and Australia.
Since the election we have signed the design and mobilisation contract with DCNS. We have agreed and signed the combat system integrator contract with Lockheed Martin. We’ve structurally separated the Australian Submarine Corporation into a submarine building company, a ship-building company, and an infrastructure company.
Most recently we have chosen Odense Marine Technologies to design the Osborne South part of the shipyard, which will build ships. It will be the most modern and busiest shipyard in the world and by late January we are expecting DCNS to provide us – and I see Herve Guillou is here, nice to see Herve who I was with also last week – we will be expecting DCNS to provide us with the design of Osborne North which will be one of the most modern and busiest submarine yards in the world. So we are throughout this year, by the end of the year, reaching every milestone that we require to make sure that the start-date of 2022 for the most significant submarine project in the world, starts on time.
For the Australian public, it’s vital for them to know in fact that this $50 billion project is the biggest one of its kind in the world. For the French public, it’s important to know that this is the largest contract that DCNS has ever had outside of France, in the world. So it’s a very historic contract for both of our countries and it’s a great pleasure to be here at the signing of the inter-governmental agreement.
JOURNALIST:
Can I ask, Prime Minister or Minister, what's the relationship of the nature between DCNS and ASC once you sort out the design and [inaudible]?
MINISTER FOR DEFENCE INDUSTRY:
Well, the Australian Submarine Corporation, of course, will have very much an ongoing role as the sustainer and maintainer of the Collins Class submarine. The Collins Class submarine will be in service for some time of course into the early 2030s. Now we have reached a critical juncture with the sustainment and maintenance. The last Cole report indicated that we are at the international benchmark standard for maintaining and sustaining submarine capability. We don't want to see that diminish in any way. It has taken us some time to get to that point and we don't want to see that diminished in the future.
So ASC's Submarine Co will have as a primary role, sustaining and maintaining the Collins Class submarines into the future. We don't want that workforce to be in competition, if you like, with DCNS, so there are also aspects to ASC which are not sustainment and maintenance, in terms of design. I know that ASC and DCNS are in conversations around their capability in terms of design and support and management. One of the big challenges or jobs that I have, is to help build the skills of the workforce into the future that will be provided for DCNS here in Australia, to be their workforce of 2,800 from 2022 and onwards.
So we have about 1800 people now at Osborne. We expect them to mostly maintain their jobs because of the mitigating measures that we have put in place to avoid Labor's valley of death. But in fact the bigger challenge for me in many respects is building that workforce to well over 5,000 to do frigates, offshore patrol vessels and submarines.
JOURNALIST:
To the Ministers, what assurances have been put in place since the leaking of information? Has there been any revision of security of information since that?
MINISTER FOR DEFENCE INDUSTRY:
Well, another one of my friends, George Brandis, was in Paris the week before I was, signing the security agreement, the new, modern security agreement with France, a treaty of course to deal with security issues. The Collins Class submarine has world's best practice in terms of security measures, and touch wood, there has never been a breach of security in terms of the Collins Class submarine. That will be the security arrangements that will be in place with the French Government and with DCNS into the future, protecting the ‘Australianised’ version of the Barracuda Shortfin submarine. So we are very confident that the security measures that will be in place for this project will be at least as good as those that have been in place for the Collins Class submarine.
As the Prime Minister mentioned, we are continuing to invest in cyber security, which is a major part of warfare into the future, and Australia is the cutting edge of cyber security. We are confident about those.
It's very important to place the leak of the DCNS material around the Scorpine in context. The only two things between the Scorpine and the Barracuda Shortfin, that they have in common, is that they both happen to be submarines. They are entirely different projects and the leak has no bearing at all on the information around the Shortfin Barracuda.
PRIME MINISTER:
Can I just add to that? We are very, very alert to and very focused on issues of cyber security and security generally. It is a rapidly evolving environment, as we all know if you read the news every day.
In our Australian Signals Directorate I think we have - I have no doubt we have, in fact - the finest cyber security group anywhere in the world. They are an extraordinary team and they are driving through our cyber security strategy, which I have made a priority of my Government, a very heightened culture of awareness and cyber security savviness, so that we will be able to better protect our secrets, our technologies, our information.
It is a very challenging environment, as you know, as we have seen. But I can assure you it is one of the highest priorities we have in all of our national security considerations.
JEAN-YVES LE DRIEN:
[Speaks French]
INTERPRETER:
I’ve already talked yesterday about this matter and I’ll repeat what I said yesterday already. First, this is really going against France and against India. Second, this is not at all involving the submarine generation that is of relevance to us here. No classified information was leaked. Nevertheless we are taking this very seriously. We have actually involved the French justice system, which is currently inquiring with due diligence and at the same time we've decided to enforce even further our capacity to control confidentiality, to ensure that this contract that which've just signed a while ago is actually the best security.
There was a general security agreement that was signed, as Christopher said, between the Attorney-General and myself a few days ago in Paris. We jointly decided to reinforce security capacities for all the networks on the one hand, but also the physical environment for drafting of the project. So we are doing the maximum we can to ensure cyber security is assured.
JOURNALIST:
Prime Minister, a domestic question, can I ask you about the mid-year budget update? In particular the ratings agencies have expressed their scepticism about the Government’s ability to deliver the intended surplus. If the Senate continues to resist you spending cuts, do you have a plan then?
PRIME MINISTER:
Well the pressure is on the Parliament to ensure that we can bring the Budget back into balance in accordance with our plan. The scepticism that you referred to is the result of the Labor Party opposing sensible budget measures of the Government's that will bring the budget back into balance in accordance with our budget plan as updated in MYEFO. So the answer to that scepticism is to work with the Government to deliver those savings.
Now we have made a considerable amount of progress. Since the election we have secured about $21 billion of gross budget savings. So we are whittling down the amount that we need to save to meet that program that we've laid out. But there will be more work to be done, as you've seen with the revisions to revenues and the uncertainty about commodity prices.
We live in uncertain times in terms of global economic conditions and many of the critically important parameters, such as commodity prices, are beyond our control naturally. So it is incumbent on all of us - Government, Opposition and crossbenchers - to work together.
I have to say, however, that there were many people, including many distinguished members of the press that were sceptical about whether we could achieve the passage of legislation through the Senate following the double dissolution election. In particular, sceptical as to whether we could secure the passage of the two big industrial reform bills, the Registered Organisations Bill and the reinstatement of the Australian Building Construction Commission Bill, whether we could secure their passage. Well, they are now law. We have secured one law through the Senate after another.
What we have demonstrated is that the 45th Parliament can work. We have demonstrated that the Government can negotiate and achieve the passage of important legislation. But the pressure is now on all of us to secure more success, to ensure that we do more to deliver the savings that we need to maintain that AAA rating.
Above all, the AAA rating is important and the ratings agencies are important, but this budget balance issue is about much more than a AAA rating. This is a moral issue. We cannot continue living beyond our means. We cannot continue throwing a mountain of debt on the shoulders of our children and grandchildren. We have to live within our means. We have to bring the budget back into balance. We should be investing for the future, certainly, and we are doing that in record amounts. In infrastructure, in investments like the submarines that we are discussing today. We are doing all of that, but we must ensure that we bring those deficits down, bring the budget back into balance and we do that out of a sense of justice to those for whom we should care more than anything else on earth - our children, our grandchildren and those that will come after that.
JOURNALIST:
Given that you’ve elevated it to a ‘moral issue’ is it not incumbent then on the Government to also perhaps consider some measures put forward by the Opposition?
PRIME MINISTER:
Well as you know in the Omnibus Savings Bill earlier in the year, which we secured with the agreement of the Opposition, we have demonstrated that we can reach compromises with other parties in the Parliament.
The reality is the Australian people did not elect a Senate with a Government majority. That was the decision of the Australian people. So we have to reach compromises, whether it is with the Labor Party or the Greens, with the crossbenchers or a combination of any of them, we have to do that.
But this issue, this moral issue, of living within our means is absolutely paramount because we cannot keep on building up this mountain of debt to throw onto the shoulders of those for whom we should care the most.
Very good. Thank you very much. Thank you.
[ENDS]