Thursday, February 19, 2015

Aussie shipbuilder scolded for its silence as government weighs plan to spend $20-$40 billion on submarines overseas

Australia wants to spent $20-$40 billion to replace its Collins-class submarines.

The head of Australian shipbuilder ASC has admitted he is yet to ask the Federal Government what its recently announced "competitive evaluation process" for submarines means.
ASC chief executive Stuart Whylie told a parliamentary committee conducting an inquiry into the naval industry that the Government had not volunteered any information, nor had he sought any.
"We assumed that we were going to be informed by Government on that process," Mr Whylie told the Senate Economics committee's inquiry into naval shipbuilding.
On the weekend before last week's failed attempt to spill the Liberal leadership, Prime Minister Tony Abbott announced a "competitive evaluation process" for deciding who would build Australia's Collins-class replacement and where they would be constructed.
Mr Abbott made the announcement after South Australian Liberal senator Sean Edwards announced he had won a commitment from the Prime Minister for an "open tender" in exchange for Senator Edwards' promise to support Mr Abbott in the Liberal party room vote.
That prompted the Opposition to accuse the Government of using the contract, expected to be worth $20 to $40 billion, as a bargaining chip for the Liberal leadership.

The Government has been under pressure to build the submarines in South Australia, in keeping with a pre-election commitment to do so.
Following the announcement, Defence Minister Kevin Andrews visited ASC's Adelaide shipyards, but Mr Whylie also told the committee he had not discussed matter during the Minister's visit, nor had he pressed ASC's case.
"We will respond to Government when we are asked to respond to Government," he said, adding that the Government had not explained what specifications it wanted.
"We have no insight to the future submarine capability requirements.
"We're waiting for advice to know what the requirement from Government is."
Mr Andrews said he would release further detail about the process "in the future".
"I will take a careful, deliberate, cautious process to all of these projects, because of the enormity and the significance of the decisions involved," Mr Andrews said.
Asked why he had not been more proactive compared to Swedish, Japanese and German defence companies, who had been actively lobbying the Australian Government, Mr Whylie said he could not do so because unlike the international companies, ASC did not have a submarine design to offer.
That prompted Senator Edwards, a member of the committee, to ask Mr Whylie "what is going on at the ASC?".
"[Are] there any entrepreneurs in there at all willing to protect the jobs at ASC?" Senator Edwards asked.
"The Government's getting unsolicited tenders, Mr Whylie, and you're having a little sitback?"
"We're not having a sitback," Mr Whylie replied, adding that his company was "strategising" over how to respond.
Mr Whylie told the committee it would take six months for the company to prepare a bid, once it learned what the requirements were.
He also testified that former defence minister David Johnston's statement that he would not trust ASC "to build a canoe" was not discussed within the company, describing it as "water off a duck's back".

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