Defence stopped ASC from talking up shipbuilding capabilities in letter to Future Frigates tenderers

DEFENCE intervened to stop ASC spruiking their shipbuilding abilities, a Freedom of Information request shows.

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DEFENCE stopped ASC spruiking its shipbuilding abilities, a Freedom of Information request shows.

The Advertiser revealed earlier this year that the tender for the $30 billion Future Frigates made it clear the foreign designers would not have to use the Adelaide shipbuilder.

ASC had teamed up with WA shipbuilders Austal to pitch for the build of the warships. But the request for tender clearly stated there was no obligation to use an Australian company or their workforce, explicitly saying ASC did not have to be used.

That prompted ASC chair Bruce Carter to warn the company would cease to exist by 2019 without ongoing work.

A concept image of BAE's Type 26 Global Combat Ship (for the Future Frigate program). Picture: Supplied.

The FOI, requested by SA Best leader Nick Xenophon before he quit the Senate, found a draft letter that ASC and Austal planned to write to tenderers BAE, Ficantieri and Navantia, copying in senior figures including Prime Minister Malcolm Turnbull.

The letter outlined their experience and offered the designers a partnership including an eventual transition of responsibilities from the designer to the shipbuilders, which would be important for future exports.

They sent the letter to the Capability Acquisition And Sustainment Group within the Department of Defence, which said they should remove several lines about their capability. CASG’s Brian Hickey suggested they remove lines saying the ASC/Austal team would help achieve Commonwealth objectives, lead the shipbuilding, and eventually take over responsibilities.

Mr Xenophon said it was “clear proof that the Government is trying to censor ASC”.

SA Best Senator Rex Patrick, who replaced Mr Xenophon, said it “confirms the intention of the Government ... to abandon Australia’s two sovereign shipbuilders, ASC and Austal”.

“No other country would bring in a foreign shipbuilder and supply them a taxpayer-funded shipyard to build their warships, in preference to using an established and sovereign shipbuilding capability,” he said.

“The company that does the build must be Australian. Minister Pyne needs to decide whether he is the Minister for Defence Industry or the Minister For Foreign Defence Industries.”

The three tenderers with foreign parent companies say they plan to hire workers from ASC, but there is no guarantee on the future of the company.

Mr Pyne accused Senator Patrick of “crass ignorance” and attention-seeking, saying the frigates “will be built in SA, employing South Australians, using Australian steel”.

“One of the three tenderers will provide the design and expertise. They will build it here and transfer IP and know-how. That is a fact,” he said.