Piers Akerman: Leaks in subs should sink French project

AFTER a year of stagnation, the Coalition’s late-night breakthrough on superannuation is a tiny step in the right direction, Piers Akerman writes.

AFTER a year of stagnation, the Coalition’s late-night breakthrough on superannuation is a tiny step in the right direction.

But those who are throwing their hats in the air in celebration of this reversal of policy are deceiving themselves.

Replacing the $500,000 “lifetime cap” on after-tax super contributions with a $100,000 annual limit is not a huge deal, but dumping the retrospective aspect which would have backdated the cap to July 2007 was a real victory for both commonsense and those who argued that the Liberal Party respect both its base and the fundamental aims outlined for the party by Robert Menzies when he led it to power in 1949.

(On that note, the documentary on the Menzies Era narrated by former prime minister and distinguished best-selling author John Howard, which begins on ABC television this evening, is essential viewing for all who wish to bring an informed view to the national debate.)

The initial decision on superannuation announced in the Budget identified a genuine flaw in the decision-­making processes of both Treasurer Scott Morrison and Prime Minister Malcolm Turnbull. That the defective policy was not immediately identified as such and rejected when it emerged from Treasury would indicate that the senior bureaucrats in the Prime Minister’s office and the Treasurer’s office either don’t have any understanding of what the Liberal Party stands for or simply don’t care.

Politicians in the House of Representatives last week. Picture: Ray Strange.

The failure of Turnbull and Morrison to recognise that failure would suggest they, too, need to watch the Menzies documentary closely to see how the most successful prime minister in Australian history managed to recognise the aspirations and ideals of generations of Australians and deliver policies which matched and ­rewarded thrift with certainty and economic security.

The Coalition’s small victory on super now provides it with the ideal moment to review other policies with which it went to the July 2 election.

Recognising that it is only just hanging on to power after its near-death experience, it should rethink some of the other policies it seized upon, notably the very expensive $50 billion submarine replacement plan.

This should be done with all urgency as leaks from the French company involved, DCNS, have already seriously, if not fatally, compromised the company’s submarine work for the Indian navy.

A group of influential businessmen including the well-known identities Dick Smith and John Singleton paid for a full-page advertisement in The Australian last Tuesday which identified a number of issues with the proposed contract the Coalition has committed to with the French-government controlled consortium to build a fleet of diesel-powered submarines in Adelaide.

They didn’t dwell on the enormous effect of the security breach, concentrating instead on the retro nature of the ­diesel submarines when vastly more efficient nuclear vessels are more cheaply and far more easily and speedily obtainable.

The ramifications of the leak from DCNS are actually potentially more damaging as they underscore the legendary inability of the French to keep other people’s secrets safe.

That, coupled with the fact that Australia would rely on American weapons systems which the Americans would naturally be reluctant to share with the French, add a huge and unnecessary impediment to the proposed building program which is already decades from delivering a replacement for the aged Collins-class fleet.

PM Malcolm Turnbull in question time. Picture: Ray Strange

The leak of the performance details of India’s fleet should have triggered an ­immediate pause of our plans and a full-scale review, but instead it triggered an orgy of denial because any ­review would call into question the political and bureaucratic ­advice on which the Australian ­decision was taken.

As the replacements are overdue, a fact acknowledged by both sides of politics, the Coalition would suffer little from a review of what is essentially a bi-partisan policy.

At the time the decision was taken, little was made of the ­effect Chinese influence was having on Australian politics. After senator “Shanghai” Sam Dastyari’s fall from grace, we know that some in Canberra are prepared to take China’s line on its claims to international waters in the South China Sea. Any inquiry should ask whether the government’s decision to ignore the Japanese tenderer was based on fears of upsetting the Chinese.

The fundamental flaws in the proposition on which DCNS successfully bid were that nuclear-powered boats were not to be considered and all efforts were to be made to maximise local production — with little heed to the cost.

It was accepted that Australian taxpayers would pay a 20-30 per cent premium to provide jobs to 2800 South Australians (and even more French workers in Toulon and Cherbourg). This was a victory of domestic political drivers over strategic and defence ­requirements and Australians must accept that they will pay a very high price for a very weak and very late capability as a result.

I understand that several senior people in Defence wanted to explore other, more cost-effective options but were forbidden from doing so.

In the end the senior officials simply stood back and watched while the elements of the coming train wreck gathered pace. There are certainly still very serious doubts about the approach within Defence but no one is prepared to confront ministers — especially SA ones — with the awful reality.

As one said: “If you asked someone to devise a new submarine program with the highest risk factors at every stage, you could not have done a much better job. It will almost certainly end in tears and possibly a catastrophe.”

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