Union strikes at Adelaide’s naval shipyard risk sinking our AUKUS subs project, Treasurer warns

Ongoing industrial action at Adelaide’s naval shipyard risks torpedoing the entire $368bn AUKUS nuclear-powered submarine program, SA Treasurer Stephen Mullighan has warned.

BAE Systems Australia workers on strike outside Adelaide Oval on May 22. Picture: Ben Clark

• Why Defending Australia matters

Treasurer Stephen Mullighan is warning union strikes at Adelaide’s naval shipyard risk torpedoing the $368bn AUKUS nuclear-powered submarine construction by convincing future governments to buy overseas boats.

In a stark warning to union workers walking off the job, Mr Mullighan said they risked sending the message that “it’s all too hard” to manage multibillion-dollar projects in Australia.

Mr Mullighan, also the state’s Defence and Space Industries Minister, further waded into workplace issues by declaring artificial intelligence could make public servants 5 per cent more productive in an economy-wide revolution.

More than 400 BAE Systems Australia workers demanding a 30 per cent pay rise escalated industrial action on May 22 after a March strike, walking off the job to march through Adelaide to BAE’s Flinders St headquarters.

Mr Mullighan said this risked scuttling the economic benefit of the AUKUS project to build nuclear-powered submarines at Osborne, starting by the end of this decade.

BAE Systems Australia workers escalated industrial action in May, demanding pay parity. Picture: Ben Clark

Treasurer Stephen Mullighan says industrial action at the Adelaide shipyards sends the wrong message to the federal government. Picture: Dean Martin

“The whole reason why the federal government, Labor or Coalition, is building the submarines here is to make sure we’ve got the sovereign capability and get the economic benefit from it. The biggest part of that economic benefit is providing thousands of well-paid jobs to Australian workers,” he said.

“When there’s industrial disputation and those workers aren’t working, then I worry it sends a signal to a future government, probably Coalition, that: ‘Oh, it’s all too hard. We’ll just buy stuff from overseas.’ Then we lose the sovereign capability and we lose the economic benefits.”

Mr Mullighan said he was not across BAE and union positions on the dispute but urged them to resolve their differences as quickly as possible.

ASC workers demanding pay parity with interstate counterparts rallied at Parliament House on September 5 last year. Picture: Matt Loxton

“The quicker it’s resolved and the greater the reputation Australia can provide as being an industrially calm place to be investing in defence industries, the better,” he said.

Australia’s chief of navy, Mark Hammond, in May warned industrial action was a “key challenge to the delivery of shipbuilding and sustainment projects”, arguing “we need to strike a better balance between maintaining the rights and protections of workers and delivering capabilities vital to national security”.

Comment is being sought from the AMWU, which has argued the workers building Hunter class frigates are critical to the nation’s naval future and the AUKUS program’s success, yet are being paid up to 20 per cent below the going rate in the shipbuilding industry.

“These are highly skilled workers. They are welders, boilermakers, electricians, fitters and riggers. SA BAE workers are sick of being treated as the poor cousin,” said AMWU SA state secretary Stuart Gordon, ahead of the May 22 strike.

“If BAE wants to build ships in Australia, they need to pay Australian workers fairly.”

CEPU SA state secretary John Adley said his members were “taking action for a fair pay rise; a pay rise that reflects their skills and recognises the important work they do as part of the shipbuilding industry” that was “vital to delivering AUKUS”.

“BAE’s main client is the Australian federal government. A government that supports the principle of same job, same pay,” he said.

“This is all BAE workers are asking for - the same pay as workers at ASC that hold the same skills and qualifications. CEPU members working at BAE will stay strong and stand up to win a fair and reasonable outcome.”

Mr Mullighan, who last year declared SA had an early mover advantage in artificial intelligence for defence and space industries, said he now was interested in AI’s role in boosting productivity across the economy.

“I’m also really interested about what it can mean for the public sector and for the work that public sector workers have to do across the different disciplines,” he said.

“If you said to me we could deploy AI to this cohort of workers, and it will make their job 5 per cent quicker and easier to do, I mean, who wouldn’t bank a 5 per cent improvement in productivity?

“That, I think, is the actual biggest opportunity. People talk about no more Ed Sheeran because someone’s going to be AI-ing tracks on Spotify, fine.

“But I think the really exciting stuff is how do we make every worker even just a few per cent more productive in what they do, because that will have a massive economy-wide impact if that can be generally experienced, and across pretty much every endeavour you could imagine.”

Originally published as Union strikes at Adelaide’s naval shipyard risk sinking our AUKUS subs project, Treasurer warns