Queensland wins $5b phase two of Land 400 vehicle contract
PRIME Minister Malcolm Turnbull has announced a Queensland-based tender has won a $5 billion contract to build combat vehicles, saying it’s time to spend Australia’s big defence budget on home soil and rejecting claims the decision was politically motivated.
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PRIME Minister Malcolm Turnbull has quashed claims the decision to award a Queensland based company a $5 billion defence deal was political, instead claiming it was time to finally spend Australia’s “big” defence budget on home soil.
Mr Turnbull visited the Gallipoli Barracks at Enoggera this morning with Defence Minister Marise Payne and Defence Industry Minister Christopher Pyne to announce the contract.
“What we’re doing today is ensuring that you have the vehicle that will enable you to complete your missions with the best capabilities, the greatest lethality but also will protect you and ensure that when you have completed your mission that you will come home safely,” he said.
“This is about Australia’s security.
“We have had a big defence budget a long time but we have not spent enough of it with Australian workers, with Australian steel, with Australian technology.”
The Prime Minister said choosing Queensland was a “very, very clear choice,” and unambiguous.
However Senator Ian Macdonald, who lives in North Queensland’s garrison city of Townsville, told The Courier-Mail the decision would help shore up votes in marginal Queensland seats.
“I’m sure it will,” he said. “The decision was based entirely on the right vehicle.”
Home Affairs Minister Peter Dutton avoided commenting about whether the decision would help his marginal seat of Dickson and said the project was a “modern day Snowy Hyrdo Scheme investment”.
“The small engineering firm or the specialist in acquisition who’s at Underwood - all those businesses will win and they will employ locals as a result of that.”
OVERNIGHT: Queensland has sensationally won a job-spinning defence contract under which the state will reap billions of dollars and gain the edge to secure an even bigger prize.
Prime Minister Malcolm Turnbull has this morning announced German-owned Rheinmetall Defence Australia – which has based itself in Queensland – has won phase two of the $5 billion Land 400 deal to build 211 state-of-the-art combat reconnaissance vehicles at Ipswich.
The announcement puts the state in the hot seat to win Land 400 phase three, a $15 billion deal to build mounted close combat vehicles.
The Courier-Mail and the federal Coalition’s 26 parliamentarians, who dubbed themselves “Team Queensland”, launched an eight-month campaign to win the project, which was approved by the National Security Committee last night.
A hook-up was held after NSC’s decision to brief the Queenslanders, politically resuscitating some MPs who were worried about holding their seats.
Queensland was awarded the contract over Victoria and BAE Systems Australia, which in the past few weeks launched a national advertising blitz to stop Queensland from winning one of the biggest defence projects.
The Government’s announcement will help reset the Queensland economy and guarantee jobs for the next 30 years because the vehicles will require refits and servicing.
About 150 of the military machines will be based in Queensland to support the brigades in Townsville and Enoggera.
The project will significantly help to diversify Queensland’s economy, creating almost 1500 jobs across Australia and wash $10 billion through defence supply chains.
Most of the money will be spent and invested in Queensland, including Army bases at Townsville, Rockhampton and Enoggera.
About $235 million across the country will be spent on new infrastructure needed to secure the vehicles.
It is understood Rheinmetall’s Boxer CRV was the far superior vehicle and has a bigger export footprint to South-East Asian countries and the potential to break into the US.
However, it is understood the Boxer was more expensive. The Government had planned to buy 225 vehicles but will now acquire 211.
The Boxer will replace the Army’s ageing Australian Light Armoured Vehicle, used in overseas combat.
The “highly lethal” wheeled vehicles can withstand a direct bomb attack, with cannons letting rip 200 rounds of ammunition a minute.
The Boxer can also defend itself by using a pulse to blow up an incoming missile.
Its accuracy is astounding – soldiers testing the Boxer shot a second round through the first hole they shot, from 2.5km away.
Mr Turnbull told The Courier-Mail last night it was good news for the Australian Defence Force and Australians.
“The world-class vehicles will be manufactured and delivered by Australian workers, using Australian steel,’’ Mr Turnbull said.
“The 211 vehicles will provide improved safety to Australian soldiers on deployment and on exercises around the world.
“They will boost mobility and firepower on the battlefield in the decades ahead.
“The decision to select Rheinmetall is the result of a comprehensive three-year tender and rigorous testing process, which assessed its Boxer CRV as the most capable vehicle for the Australian Defence Force.
“The CRVs will undertake a range of missions, from regional stability and peacekeeping through to high-threat operations.
“Over the 30-year life of the vehicles, Australian industry will secure two-thirds, or $10.2 billion, of the total investment in acquiring and maintaining the fleet, creating up to 1450 jobs right across Australia.”
Mr Turnbull said Rheinmetall was working with more than 40 companies across Australia to ensure it was a “national enterprise”.
“It presents an exciting opportunity for Australian industry to play a vital role in delivering leading-edge capability and technology to Australia’s army,” he said.
In January, decorated war hero Ben Roberts-Smith told The Courier-Mail troops under fire would have a better chance of surviving if the Government bought the Boxer.
Mr Roberts-Smith, who said he would not tell the Prime Minister or others what to do because “they are going to have to live and die by their own decisions”, said Rheinmetall’s Boxer CRV offered more protection over BAE Systems Australia’s armoured vehicle.
Those close to the process said Mr Roberts-Smith’s intervention was influential in Canberra.
Premier Annastacia Palaszczuk met with the German ambassador on the Gold Coast to strategise in August.
Member for Fairfax Ted O’Brien, who led the charge for Team Queensland, said it was a tough fight worth winning.
“Queenslanders have always been proud to fly the maroon flag – well now we’re the khaki state as well, and nowhere deserves that title more,” Mr O’Brien said.
“The Turnbull Government has put the safety of our Australian servicemen and women at the forefront of its decision and in doing so has also ensured the creation of an Australian military vehicle industry that will become a dominant player globally.
“This is a win for our troops and it’s a win for the Australian economy.
This is about far more than a contract to build combat reconnaissance vehicles.
“This decision represents the birth of a new industry in Australia. When Queenslanders unite, nothing can hold us back.”
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