Time is up for our modest funding of serious tech

Encompassing a wide range of advanced defence technologies from hypersonics to quantum, AUKUS Pillar 2 has missed out on the top-level political pageantry and big-ticket announcements.

US Defense Secretary Lloyd Austin (centre), isflanked by Defence Minister Richard Marles and British Defense Secretary Grant Shapps, during a joint press conference during the AUKUS Defense Ministerial Meeting in California, on December 1, 2023. Picture: AFP

Barely a week goes by without more feverish debate about nuclear-powered submarines. But ironically it is AUKUS Pillar 2 – the part not concerned with submarines – which often seems to be operating in stealth mode.

Encompassing a wide range of advanced defence technologies from hypersonics to quantum,
Pillar 2 has so far missed out on the top-level political pageantry and big-ticket announcements. Nonetheless, significant work is going on across government and the research sector to realise the awesome potential of this agreement. The meeting between the respective Defence ministers of the AUKUS nations in December last year, and the joint press release addressing Pillar 2 in detail, was certainly an improvement in political optics.

Justin Burke.

On the practical side, knocking down barriers between the defence sectors of the US, UK and Australia is a crucial undertaking. (The sheer difficulty is one major reason it is typically carved out of free trade agreements.)

One element is the changes to Australia’s Defence Trade Controls Act, which recently passed into law, and were designed to strike a careful balance between aligning our export controls regime more closely with that of the US and protecting our broader non-AUKUS research partnerships. They have been endorsed by the university peak body Go8.

Incentivising the desired R&D has commenced with the first trilateral Innovation Prize Challenge focused on electronic warfare. On the Australian side, this is led by the Advanced Strategic Capabilities Accelerator (ASCA) which commenced operations just nine months ago. More challenges are promised in the coming months.

While these steps are all welcome, they are also undeniably modest. Researchers in the quantum field for example – where Australia is internationally recognised for its research excellence – are performing miracles with grants in the low millions (and in the case of industry, sometimes less).

This has left the field open for critics. Professor Hugh White recently described Pillar 2 as “window dressing, at best”. He argued Australia’s R&D contribution will be too modest to induce any additional reciprocity from the US or the UK. Reducing defence trade barriers between the three nations may not send more work to Australia because defence contracting is heavily politicised, he said. “It is easy to talk up the
military potential of exotic new technologies, but delivering real capability is a different matter.”

But before we allow Pillar 2 to wilt before such withering assessments, it is worth remembering what is at stake.

The new technologies we put into the hands of our warfighters in the short term may be the ones they will carry in next conflict; it is serious business. The research into Pillar 2’s priority areas – from hypersonics to undersea autonomous vehicles – could give our Pillar 1 nuclear-powered submarine capability enduring competitive advantages and increased lethality. And the future technologies of Pillar 2 have the potential for transformative economic spillovers (unlike submarine construction).

The time for modest steps is over. We need to prove the naysayers wrong and up the ante with funding, focus and leadership for AUKUS Pillar 2.

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Justin Burke is a senior policy adviser at the National Security College, ANU.