Classified Defence Strategic Review document designed to 'keep adversaries further from our shores'

The classified Defence Strategic Review recommends a rapid boost to long-range strike capabilities, the urgent acquisition of killer drones and a major increase in naval firepower.

Former defence chief Angus Houston, left, delivers the defence review to Anthony Albanese, centre, and Richard Marles. Picture: Gary Ramage

Anthony Albanese has been handed a blueprint to prepare Australia for a potential war with China, recommending a rapid boost to long-range strike capabilities, the urgent acquisition of killer drones, and a major increase in the nation’s naval firepower.

The Prime Minister and Defence Minister Richard Marles were handed the final report of the Defence Strategic Review on Tuesday by former defence chief Angus Houston, who declared the document was “the most important work that I have been involved with in Defence”.

The classified review, to be considered by the government over the coming weeks alongside a report by its nuclear submarine task force, is understood to call for the fast-tracking of new long-range and unmanned weapons platforms to deliver what Mr Marles has termed “impactful projection”.

It is also believed to recommend the procurement of at least six new corvette-style warships armed with guided missiles, new unmanned submarines, and ­potentially up to three more air warfare destroyers.

The document is likely to cut the army’s order for new infantry fighting vehicles to about 300 from an initially planned 450, while defence industry sources say an order for 160 new tanks might not proceed.

The review is understood to recommend a sweeping overhaul of Defence’s acquisition arm to slash the time needed to bring new capabilities into service, while the northern bases are expected to be further hardened to place them on a war footing.

It follows a 2020 defence strategic update warning Australia must be ready to fight a conventional war within the next 10 years amid China’s rapid militarisation and fears of a potential great power conflict over Taiwan.

Mr Albanese thanked the co-authors Sir Angus and former defence minister Stephen Smith for their “extraordinary work” on the review, which included meetings with 150 defence experts and consideration of 360 submissions.

He said it would help prepare the ADF for a more dangerous ­future by ensuring “Defence’s capability and structure is fit for purpose and delivers the greatest return on investment”.

“This is about preparing Australia for the challenging strategic circumstances that we face,” Mr Albanese told parliament.

Mr Marles said the report was “the single most important re-evaluation of Australia’s strategic posture in the past 35 years”, and was delivered against a backdrop “of the most complex strategic landscape that we have faced since the end of the Second World War”.

“The DSR is an ambitious and extensive examination of our strategic circumstances and will underpin defence policy for decades to come,” he said.

“Australia must be resolute in its responsibility to safeguard our region and keep adversaries further from our shores.”

Mr Marles said the government would consider the classified version of the review before releasing an unclassified version together with the government’s response to the document.

The government has already received advice from AUKUS submarine task force head Vice Admiral Jonathan Mead on the “optimal pathway” for Australia to acquire nuclear-powered subs.

Vice Admiral Mead told the ABC’s 730 program this week that the planned nuclear boats would be “a pre-eminent war-fighting capability that will defend Australia, protect our people, (and) safeguard our economic prosperity”.

There is widespread speculation that the recommended option, due to be unveiled in Washington DC next month by Mr Albanese, US President Joe Biden and British Prime Minister Rishi Sunak, will be a next-generation UK submarine with a US combat system and weapons, rather than an American boat.

Former submariners and defence industry sources say the planned replacement for Britain’s Astute submarines, dubbed SSN (R), is likely to be chosen over the US Virginia-class subs, because its smaller size and crew requirements were more appropriate for Australian needs.

The speculation comes amid repeated hints from Mr Marles and British Defence Secretary Ben Wallace that the AUKUS sub will be a “genuinely trilateral boat”.

The view is backed by renowned British think tank the International Institute for Strategic Studies, which recently issued a paper saying the “SSN (R) has been finding favour, and could potentially be developed further under AUKUS”.