Push to increase Australia’s defence budget to 3 per cent of GDP

Australia has been given a pretty emphatic reminder that in the numbers game it’s behind in ships and aircraft.

EXCLUSIVE: Australia needs to increase defence spending and acquire additional ships and aircraft to secure the nation’s security and strategic interests, experts warn.

It comes as UK Prime Minister Keir Starmer commits to increasing defence funding to 2.5 per cent of GDP by 2027 and three Chinese warships remain off the coast of Australia.

Neither the Labor or Coalition have yet detailed commitments to further increases in defence spending, which is currently about two per cent of GDP, ahead of the soon-to-be-called federal election.

Anzac-class frigates HMAS Ballarat, HMAS Anzac and HMAS Stuart off Western Australia. Experts warn Australia needs to increase defence spending and acquire additional ships and aircraft to secure the nation’s security and strategic interests.

Strategic Analysis Australia director Peter Jennings said defence funding should be increased to at least three per cent of GDP.

“Our strategic circumstances have gotten significantly worse and as such we really do need to start strengthening our defence capabilities as a response,” said Mr Jennings, formerly the defence department deputy secretary for strategy.

Britain's Prime Minister Keir Starmer. Picture: Leon Neal/Pool/AFP

Australian Strategic Policy Institute director Peter Jennings.

The Albanese government has made a series of funding commitment announcements and expects defence funding to increase as a proportion of GDP to 2.3 per cent by 2033-34.

Analysts said the deployment of Chinese warships, which were last reported about 296km east of Hobart, was a blatant act of aggression aiming to test the new Donald Trump presidency.

a Special Operations Task Group soldier in Uruzgan Province, Southern Afghanistan. The Albanese government has made a series of funding commitment announcements and expects defence funding to increase as a proportion of GDP to 2.3 per cent by 2033-34. Picture: Department of Defence

Australian Strategic Policy Institute Defence Strategy and National Security director Dr Euan Graham said the Royal Australian Navy [RAN] would need additional ships, which costs billions, to achieve strategic deterrence against nations like China.

“We’ve just been given a pretty emphatic reminder by the Chinese navy that, in the numbers game, they’re well ahead,” he said.

“If you want to be able to send Australian ships into the region and, at the same time, defend and monitor against the projection of Chinese naval power close to Australian shores, then you’re going to need more ships.

“To get more ships, you’re going to need to spend more.”

Army Black Hawks during an exercise Hamel in northern Queensland. The nation’s air and maritime capabilities were judged “pretty good” but could be improved.

Lowy Institute international security program director Sam Roggeveen said the nation’s air and maritime capabilities were “pretty good” but could be improved.

“One way that we could be improving our defence strategy is to focus very narrowly on that objective of protecting our air and sea approaches,” he said.

“That doesn’t necessarily mean you need to spend more on defence, but it does mean you need to spend differently.”

The RAN currently have eight Anzac frigates. Construction has started on the first of six Hunter class frigates and two shipbuilders have been selected to design the nation’s first general-purpose frigate as part of a $54 billion fleet overhaul.

Defence Minister Richard Marles says the Albanese government plans to spend more on defence. Picture: NewsWire/John Gass

Defence Minister Richard Marles said the Albanese government was spending an additional $5.7 billion in the forward estimates and $50.3 billion over the next decade on defence.

“We inherited a Defence budget in a mess, with record-high over-programming and $42 billion in unfunded announcements,” he said.

“After almost three years, (shadow defence minister) Andrew Hastie and the Liberals still have no real plan to lift Defence spending.”

Mr Hastie said the Coalition was committed to increasing spending on defence if elected and accused the Albanese government of fuelling a readiness crisis.

“Labor’s tiny increase to Australia’s defence spending is barely enough to cover inflation, and is well below where we need to be to deliver AUKUS,” he said.