Secret documents show minimum 50 per cent Australian build on Future Frigates defence project

JUST half of the work on the $30 billion Future Frigates must be done in Australia, secret documents show— in which Nick Xenophon Team senator Rex Patricks calls a “tender betrayal”.

• Australian shipbuilders locked out of frigates bid
• Stealthy warship to be exported from Adelaide

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• Future Frigates tender should be rewritten

JUST half of the work on the $30 billion Future Frigates must be done in Australia, secret documents show.

SA Best has obtained the request for tender for the major warship project under Freedom of Information laws.

Discussed targets for the Australian component of major submarine and shipbuilding projects have ranged as high as 90 per cent, although that figure was rejected by most experts as impossible.

The Australian Industry Council and others have said at least 70 per cent should be Australian, while Defence Industry Minister Christopher Pyne has defined a “local build” as at least 60 per cent.

He says Australian involvement will be maximised, and the tender document makes it clear that is a requirement.

But the document also says: "The Air Warfare Destroyer Program has achieved Australian contract expenditure in the order of 50 per cent across the whole program... the Commonwealth expects that this project will achieve the same or higher level of Australian contract expenditure.”

The Global Combat Ship-Australia (GCS-A) is BAE Systems' offer to the Commonwealth for the future frigates project.

SA Best Leader Nick Xenophon, who requested the document while he was still a senator, said there needed to be an independent audit of the Australian content.

“They’re not being firm on local content. Fifty per cent means we’re exporting more jobs than we need to,” he said.

The tender emphasises the need to involve the Australian supply chain and develop the domestic industry, including opportunities to export. Tenderers also have to describe how they will build and maintain a workforce in Australia, and how they will transfer knowledge to that workforce.

Senator Rex Patrick, who replaced Mr Xenophon in the federal Senate, called it a “betrayal”.

“The approach is nothing short of treachery,” Mr Patrick said.

“We have two established and highly capable shipbuilders in ASC and Austal that have been excluded from the role of shipbuilder in that program.”

“Instead, the Government has invited a foreign ship designer into the country, will provide them with a taxpayer funded shipyard to build the future frigate, from where they will eventually go on to compete against those Aussie companies.”

Mr Pyne called Mr Xenophon a “political trickster” and a “rank opportunist”.

He pointed out that Mr Xenophon’s replacement, Rex Patrick, has previously spoken against having an Australian shipbuilder.

“The Future Frigates program will be built in SA, by Australians using Australian steel. Australian businesses will benefit massively as part of the supply chain and Australian industry content will be one of the key factors in the government’s decision, second only to capability,” he said.

The document calls on tenderers to pursue export opportunities “utilising elements of the shipbuilding workforce”, but Mr Xenophon said the process was stacked against local shipbuilders. The news comes as the Federal Government announced a strategy to boost military exports both to close allies and the Middle East and Indo-Pacific region.