Anthony Albanese and Peter Dutton will be forced by seismic world events and by Donald Trump to place Australia on a fast-track to sharply increased defence spending.
This boost in the defence budget is now all but inevitable and is likely to be announced by both leaders in the coming election campaign. This commitment will need to start sooner rather than later – within the four-year forward estimates – and as such it threatens to complicate the spending priorities of both parties in the looming election.
Yet these are extraordinary times as we witness the erosion of global security and Australia’s strategic certainty in real time in the fallout from events in Washington, Kyiv, Moscow, Gaza and Beijing.
Trump’s erratic leadership which has seen him question the Trans-Atlantic alliance, fall out with Ukraine’s Volodymyr Zelensky and appease Russian dictator Vladimir Putin, has raised genuine questions about America’s reliability as an ally.
The call by Mr Trump’s nominee for head of policy at the Pentagon, Elbridge Colby, that Australia needed to lift defence spending to at least 3 per cent of GDP, from the current level of 2 per cent, will almost certainly be backed by Trump himself.
Given that Britain and European leaders have already moved to significantly lift defence spending in response to Trump’s demands for US allies to bear greater responsibility for their own security, it would be difficult for Australia to claim a special exception when our defence spending is languishing at just 2 per cent of GDP with slow-train plans to crawl to 2.3 per cent in a decade.
At The Australian’s Defending Australia summit in Adelaide this week, Defence Minister Richard Marles all but conceded that defence spending will need to rise beyond current projections of a $50bn boost over a decade, revealing he was in “ongoing conversation” with the Trump administration about the issue.
The Coalition is promising to lift defence spending but it won’t yet reveal by how much.
Colby pointed out Australia was “well below” the 3 per cent of GDP defence spending advocated by NATO despite facing “a far more powerful challenge in China”.
China is using this moment of global uncertainty to thump its own chest, with Beijing this week announcing yet another large increase in defence spending while dispatching a warship to circumnavigate Australia to remind Canberra of the global reach of its navy.
The example of British leader Keir Starmer provides a good template for Australia. Starmer has pledged to lift to lift Britain’s defence spending from 2.3 per cent of GDP to 2.5 per cent in just two years with a “clear ambition” to lift it to 3 per cent of GDP after the next election.
If there was enough political will, Albanese and Dutton could pledge to lift defence spending from 2 per cent to 2.5 per cent of GDP by the end of the decade, with a target of 3 per cent by the middle of the 2030s.
Even without the current world disorder and a maverick US president, Australia will need to be spending close to 3 per cent of GDP on defence in the 2030s to pay for acquiring nuclear submarines under the AUKUS pact.
Political courage will be required for any Australian government to embrace a 3 per cent of GDP target for defence spending simply because it would force a major reordering of the government’s future spending priorities at a time when the public wants more, not less spending, on social services, education and health.
But these are the real-life choices which Albanese and Dutton now face as they confront a new world disorder stoked by an unreliable leader of the free world.
Keating slams Marles’ ‘Pacific war’ stance
Paul Keating has slammed Defence Minister Richard Marles for saying Australia would play a key role in a potential US-China war in the Pacific.
Scott Morrison’s appeal to Trump on AUKUS
Scott Morrison says Anthony Albanese needs to provide incentives for Donald Trump to take ownership of AUKUS to secure its future.