The Australian Federal Government is investing $200 billion over the next decade to modernise Australia’s defence capability – from large scale projects with national reach to local solutions and contracts to support the Defence Force every day.
This means great opportunities for Australian businesses to deliver these new capabilities.
And not just any businesses. Large and small businesses with cutting edge technology and efficient supply chains will be highly sought after, to build and encourage an advanced defence industry, innovative manufacturing and securing jobs for Australians.
Federal Government keen to invest in defence
There’s no doubt the Federal Government is keen to invest in the defence industry in Australia. They have set up several initiatives to plan for a big future –
- The Defence Industrial Capability Plan This was released in 2018, outlining the government’s long-term vision for the Australian defence industry. The premise of the strategy is to build and develop a robust, resilient and internationally competitive Australian defence industry base to better meet defence capability requirements.The government is investing in Australia’s defence industry as part of the Integrated Investment Program over the next decade and includes:
- New infrastructure across Defence – $3 billion for facilities and maintenance hubs to support new capabilities, over $1.8 billion on a military base and critical infrastructure renewal and over $25 billion forecast investment (to 2028) to build and maintain defence infrastructure to support new and existing capabilities.
- Reliable and sustainable Defence funding
- Ensuring Australia has access to and control of vitally important capabilities to keep the Australian Defence Force (ADF) on the cutting edge of new technologies.
- 2016 Defence White PaperThis 2016 Defence White Paper outlines a $200 billion investment for the next ten years. This involves strategies to maximise involvement and opportunity for Australian industry across Defence programs, from large scale projects with national reach to local projects and contracts that support the daily transactions and efficiencies of the Defence Force.
- Global Supply Chain program The government’s Global Supply Chain program gives exclusive access to Australian companies to enter into close commercial relationships with, and provide vital parts to Lockheed Martin, Rheinmetall, Northrop Grumman, Thales, Boeing, BAE and Raytheon.
A look at the Australian Defence Force statistics
The Australian Defence Force military strength in 2019 is –
Royal Australian Navy – 14,689 personnel with 47 Naval assets. It owns 10 frigates, two aircraft carriers, six submarines and six mine warfare vessels.
Royal Australian Air Force – 14,295 personnel with 78 fighters, 78 attackers, 39 transporters, 162 trainers, and 157 helicopters.
Australian Army – 30,810 personnel with 59 combat tanks and 2040 armoured fighting vehicles.
The Defence budget also supports 16,393 personnel within the Australian Public Service (APS) with an additional 19,850 reservists.
Australian Defence Industry
With a record investment of $200 billion, The Australian Government has pledged the nation’s biggest peacetime investment in Defence. By 2020-21, the investment in Defence will be 2 percent of GDP.
The Defence industry is expected to grow at an annualised 5.6% over the five years through 2018-19, to $37.6 billion.
The defence industry companies provide varying products and services from the construction of military transport, to the development of cutting-edge information technology systems. The top forty defence contractors in December 2016, according to Australian Defence Magazine, had an annual turnover of $10.3 billion.
The Australian Trade and Investment Commission calculated these defence industry organisations also export about $750 million per annum worth of defence products and services each year.
Opportunities within the Australian defence
The ability to quickly adopt cutting edge technology
The 2016 Defence White Paper has already seen 173 project-related decisions utilising cutting edge technology. A substantial share of aerospace and defence products are supplier developed, it is investments like these that will prove to be critical enablers for the defence industry.
Companies taking advantage of Industry 4.0, will be of interest to the Australian Defence Force. This includes the ability to use cyber-physical systems powered by the Internet of Things (IoT), robotics, artificial intelligence (AI), autonomous machines, augmented reality and big data to provide solutions for land, sea, and space environments.
This smart, connected, self-maintaining equipment and technology brings many benefits including cost-savings, speed improvements, further collaborative innovation and performance improvements. Utilising this technology also, provides the means for the Australian Defence Force to improve the accuracy to predict and respond to supply needs and smarter resource management of inventory and other assets.
Cyber-attacks are a real and present threat to the ADF’s warfighting ability as well as to the rest of government with wide spreading implications to Australia’s economy and critical infrastructure.
With the increase of cyber threats to Australia growing, new and more complex security practices will be an important part of future security environment.
Australia has experienced extreme challenges to the management of its 2.85 million km2 maritime domain.
The ADF contributes to protect Australia’s borders and offshore maritime interests as part of Operation RESOLUTE. At any one time, there are 600 personnel at sea, in the air and on the land working in joint effort with the ADF, and the whole-of-government.
Not only the physical challenges of protecting such a large domain, there are also the strategic, environmental, economic and political issues at conflict with the commercial and traditional activities.
New technology that solves these border and offshore maritime interests and brings new capabilities to the Defence Force will be welcomed.
The future of the Australian defence industry
- Building on defence industrial capability
As Australia builds its defence capability to support the ADF operations today, it needs to look at supporting its sustainability for future capability. This will be in the form of a larger, more capable and prepared defence industry with the skills, expertise, technology, intellectual property and infrastructure.
- Find new markets and greater opportunities
Australia’s defence industry has gone from strength to strength in a short period of time, however, it has traditionally relied solely on domestic consumption. Australian defence industry needs to find new markets and greater opportunities to realise its full potential and support the future needs of the Defence Force.
Recognising the importance of the export market to help the industry diversify, grow, innovate and support future needs, the government established the Defence Export Strategy. It places more attention on policy that supports Australia’s existing trade and strategic partners serving as valuable markets for industry collaboration and export growth
Support for your business entering the defence industry
The Centre for Defence Industry Capability is the place to find information on how your business can provide valuable resources to the defence force.
Their advisers help businesses navigate the defence market, provide specialist advice on improving competitiveness and accessing global markets, and facilitate connections with Defence and other businesses, key contractors, research institutions as well as state and territory agencies. They also link Australian innovators and researchers to the Defence Innovation Hub and the Next Generation Technologies Fund.
Start here with the Defence Industry Security Program
Any business interested in doing business with the Australian Defence Force must apply for membership to the Defence Industry Security Program. This program is designed to maintain the security responsibilities and safeguard the supply chain.
Build your Defence network.
The team of business advisors at Abdera can help your business navigate the defence industry and identify opportunities directly with Defence or within its supply chains. Call us today on 1300 728 470 or contact us.
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