Alarm bells are ringing about Adelaide’s $45bn Hunter Class frigate project

The prospect of only three naval frigates being built in Adelaide is sparking strong concern at the highest levels of the state government.

The prospect of only three naval frigates being built in Adelaide – effectively scuttling the $45bn project – is sparking strong concern at the highest levels of the state government.

The project to build nine Hunter Class frigates at Osborne Naval Shipyard, already well advanced by BAE Systems Australia, is expected to go to the federal cabinet’s expenditure review committee by the end of March.

There is strong concern that Treasurer Jim Chalmers will not find sufficient funds in his May budget to construct at least six frigates, needed to keep the federal government’s promise of a continuous naval shipbuilding program in Adelaide.

Both Defence Minister Richard Marles and Premier Peter Malinauskas have repeatedly emphasised the importance of a continuous naval shipbuilding program ahead of Adelaide construction of nuclear-powered AUKUS submarines starting in the 2030s.

Evolved Hunter Class design for guided missile frigate. Supplied by BAE Systems Australia

Responding to Opposition questions, Mr Malinauskas on Tuesday accused the former coalition government of announcing a policy of building nine frigates in Adelaide but argued “there were zero ships” in the “funding profile”.

“The federal government now has to make sure that if we are to build the Hunter Class in South Australia, we don’t just announce a number, we actually announce the extraordinary volume of dollars that is required to actually build them. That’s where the rubber hits the road,” Mr Malinauskas told parliament.

“ … We do not believe that the federal government can honour its commitment to continuous shipbuilding in South Australia without it being Hunter, because if they don’t deliver Hunter, then there is no continuous shipbuilding.”

Evolved Hunter Class design for guided missile frigate. Supplied by BAE Systems Australia

The project’s future has been clouded by a review of the navy’s surface fleet, which Mr Marles received in September and is expected to make public within weeks.

There is serious concern within state government ranks that the Hunter project will be downgraded to three ships without any immediate replacement work being commissioned when the surface fleet review is released.

Under this scenario, Mr Malinauskas would be forced to actively target federal Labor for a broken promise or risk losing credibility and votes in SA.