Urgent long-range missile orders and domestic guided weapons industry delayed for another Defence review

Urgent long-range missile orders and the establishment of a domestic guided weapons industry will be delayed by at least 12 months for yet another Defence review.

Defence Minister Richard Marles will reveal on Wednesday the government will spend $4.1bn to acquire more long-range strike systems and manufacture guided weapons in Australia. Picture: Martin Ollman

Urgent long-range missile orders and the establishment of a ­domestic guided weapons industry will be delayed by at least 12 months for yet another Defence review, amid the most challenging strategic circumstances in generations.

The Albanese government gave the green light to a raft of ­reviews on Monday in its ­response to the long-awaited ­Defence blueprint, including a new options paper on bolstering the nation’s missile stocks that will not report until mid-2024.

Defence Minister Richard Marles will reveal on Wednesday the government will spend $4.1bn from the ADF’s current budget to acquire more long-range strike systems and manufacture guided weapons in Australia.

The funding includes $2.5bn for the guided weapons and ­explosive ordnance enterprise, revealed earlier by The Australian, as well as $1.6bn to accelerate delivery of new HiMARS launchers and Precision Strike Missiles

But on page 106 of the declassified version of the Defence Strategic Review, the government sets in motion a new assessment process that will put on hold some of the government’s top priority missile programs.

“Options for the increase of guided weapons and explosive ordnance stocks, including the rapid establishment of domestic manufacturing, should be provided to the government by Q2 2024,” the review said, followed by the government’s response – “Agreed”.

Neither Defence nor Mr Marles’s office was able to say on Tuesday whether the options would be developed by the ­department, the government’s preferred manufacturers, or independent reviewers.

The move comes despite government vows to accelerate acquisitions and engage in “smarter” contracting to get new weapons into service faster.

Further reviews in the Stephen Smith and Angus Houston-led document include a six-month process to decide the future of the navy’s surface fleet; an options paper on achieving recruitment targets due in 2024; and a “comprehensive strategic review” of the ADF’s reserves to be completed by 2025.

A whole-of-government council will also be established to ­develop a plan to ensure resilient fuel supplies, while an audit of “Defence estate and infrastructure” is due for completion by the end of this year.

The missile review comes three years after the guided weapons enterprise was flagged in the Morrison government’s 2020 Defence Strategic Update, and follows a wasted 12-month tender process to select the government’s preferred partners. The selected companies, Lockheed Martin and Raytheon, already manufactured the ADFs most common missiles and were always going to play key roles in the enterprise.

Opposition defence spokesman Andrew Hastie said the government’s claims to be fast-tracking capabilities were hollow.

“After telling us how urgent the situation is and how we need to build a long-range strike capability, we don’t see any immediate action or new money invested,” Mr Hastie said. “Instead we get more reviews, kicking decisions off into the long grass. The government talks about a sense of urgency but the only thing that seems urgent is more paperwork. What we need is more hard power, and quickly.”

Australian Industry and ­Defence Network chief executive Brent Clark said small and ­medium defence companies had been operating with the understanding that Monday’s release of the review would “provide certainty going forward”.

“Unfortunately the document now points to a further review to develop options for the GWEO (guided weapons and explosive ordnance) enterprise,” Mr Clark said.

“These options are due to be delivered sometime in 2024, ­presumably for the government to consider, then modify or ­approve.”

He said the delay meant the domestic missile enterprise was no further advanced than when it was announced three years ago.

Mr Clark said Australian ­defence companies were also concerned at the review’s warning that the need for local industry involvement in key projects “must be balanced against timely capability acquisition”.

“Without a clear intent from government, Australian industry will simply be brushed aside under the guise of ‘speed to capability’,” he said.

“If we do not achieve this outcome then Australia’s interests will always play second fiddle to the interests of our allies, and we will sit down the queue for replenishment of our supplies, potentially compromising our security.”

Another defence industry source, who declined to be identified, said the decision-making process was likely to drag on for longer than the 12-month review period.

“There’s so much rhetoric around it being the highest priority for Defence, but we’ve got to wait another year, and then it has to go through the whole government approval rigmarole,” the source said.

A third industry source said: “We know what missiles we need to buy but haven’t placed an order.”

Strategic Analysis Australia director Peter Jennings, a former Defence deputy secretary, said he was staggered domestic missile production was subject to further delays.

“This goes at least back to 2020. We've known about the options for missiles for a very long time,” Mr Jennings said.

“And I cannot see what is left to work out, frankly, that couldn‘t be done clearly enough right now, if the government wanted to do it.”

The $2.5bn funding for the guided weapons enterprise to be announced by Mr Marles on Wednesday will support “concrete, costed plans”, to be handed to the government by the end of this year, on manufacturing and maintaining selected long-range strike and air defence missiles, sea mines, and 155mm artillery shells.

The funding, which will be drawn from within Defence’s existing budget, will also support guided weapons testing and research, and the expansion of missile storage and distribution systems.

“The Albanese government is moving immediately to respond to the review and committing real funding to these programs and capabilities,” Mr Marles said.

“We are reshaping the Australian Army and modernising it for the current strategic circumstances. This investment in key capabilities will see the Australian Army’s current range for artillery grow from 40km to in excess of 500km.”

Mr Marles said on Monday that equipping the ADF with new strike capabilities and getting missile production underway in Australia were among the government’s top defence priorities after the nuclear submarine program.

He warned again on Wednesday there was no time to waste.“It’s urgent. It’s definitely urgent,” he said.