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84 <strong>SENATE</strong> Thursday, 13 October 2016<br />
COMMITTEES<br />
Foreign Affairs, Defence and Trade References Committee<br />
Report<br />
Consideration resumed of the motion:<br />
That the Senate take note of the report.<br />
Senator WHISH-WILSON (Tasmania) (16:22): The Greens initiated this inquiry into the joint strike fighters.<br />
It was a most enlightening Senate inquiry into a $60 billion procurement program by the Department of Defence<br />
into the joint strike fighter. Four words that would best encapsulate this acquisition of the joint strike fighters<br />
would be 'too big to fail'. The words of President Dwight D Eisenhower were very clear to me during the inquiry.<br />
In fact, I have a copy of the quote which I read to one of the witnesses from Lockheed Martin in the US who had<br />
flown in. It said:<br />
Only an alert and knowledgeable citizenry can compel the proper meshing of the huge industrial and military machinery of<br />
defense with our peaceful methods and goals, so that security and liberty may prosper together.<br />
That is only part of the quote from President Eisenhower, but he went on to warn about the risks of the military<br />
industrial complex if it is not properly scrutinised and policed.<br />
I think if there was ever a case study of what not to do with a military procurement and how not to go about<br />
spending taxpayer moneys on our defence it would be this joint strike fighter program. Another quote says that the<br />
F35 program:<br />
… is actually not on a path towards success, but instead on a path towards failing to deliver the full Block 3F capabilities, for<br />
which the department is paying almost USD400 billion …<br />
That is $400 billion of US taxpayers' money. It has been spent essentially on one major company, Lockheed<br />
Martin, and a number of smaller suppliers. That quote is from Michael Gilmore, the US defense department's<br />
director of operational testing, only a few months ago. In fact, it is from August 2016. So it was after our inquiry<br />
wrapped up going into the double dissolution.<br />
Defence procurement is often characterised by large numbers and opaque decision making. The reason it is<br />
important to scrutinise this joint strike fighter acquisition is that we have the biggest defence procurement<br />
program of submarines about to hit our shores—pardon the pun! They are coming very shortly. We need to be<br />
very, very careful about how that money is spent, and we need to learn from this joint strike fighter acquisition.<br />
Even by our standards, Australia's planned acquisition of 72 F35A joint strike fighters stands out for its cost<br />
and time overruns and lack of a backup plan. When even US testing authorities are uncertain whether the aircraft<br />
will be fit for service, the basis for the enthusiasm shown by Australian defence officials—all documented in this<br />
report—deserves greater scrutiny.<br />
The Greens cannot support the majority recommendations in this report. It seems entirely likely that Australia<br />
will eventually be forced to follow Canada's lead and leave the joint strike fighter program and reassess its options<br />
rather than simply insisting that there is no plan B to these joint strike fighters.<br />
The report makes for compelling reading. In particular, chapter 3 sets out the setbacks and the challenges that<br />
have beset this program since its inception. There are meant to be systems in place to prevent such debacles from<br />
occurring; however, they have occurred. This program has been beset by a litany of problems and serious issues.<br />
These were covered at length during the inquiry. They have been acknowledged in the report. The chair's report<br />
rightly concludes that it cannot draw definitive conclusions on the performance capability of the aircraft.<br />
It is therefore baffling that the chair's report goes on to state that it is satisfied that the joint strike fighter will<br />
suit Australia's needs. Given the operational capability of the aircraft remains unproven, it is simply impossible to<br />
reach this conclusion. This underscores the fundamental problem with Australia's participation in this acquisition.<br />
The Greens will continue to scrutinise this acquisition. Our recommendation is that the Australian government<br />
cancel its contract to acquire the joint strike fighter and restart an open tender process to acquire new aircraft.<br />
Senator XENOPHON (South Australia) (16:28): In the very limited time available, I indicate that this is a<br />
very important report. It is a major acquisition, and there have been major questions raised on the acquisition of<br />
the F35 joint strike fighters as to whether they will be adequate for Australia's needs and whether there will be<br />
significant cost overruns, which is what I fear.<br />
I also wish to commend Senator Peter Whish-Wilson for instigating this inquiry, which I was very pleased to<br />
co-sponsor because this is an important inquiry. We need to make sure that as taxpayers we get the best value for<br />
money in any acquisition but also that importantly for our troops, our Air Force, it provides the best defence<br />
possible for the Commonwealth of Australia. The fact that there have been serious concerns raised around the<br />
CHAMBER