Archive from September, 2012

Australia’s military engagement: a view from VCDF (and ASPI)

VCDF Air Marshal Mark Binskin (Photo: Luke Wilson)

The Vice Chief of the Defence Force, Air Marshal Mark Binskin AO, delivered a thought-provoking speech entitled ‘The ADF as as a foundation for Australian prosperity’ to an ASPI dinner last night, and here are three reflections from ASPI analysts.

Peter Jennings:

Air Marshal Mark Binskin, the Vice Chief of the Defence Force, gave an interesting speech emphasising the ADF’s role in contributing to regional stability. There is no doubt that Defence is shaping for a closer focus on the Asia-Pacific after the drawdown in Afghanistan. The ADF ‘is not just an insurance policy’ Binskin said; it can build and deepen relations, respond to disasters and stabilise trouble spots.

Some implications flow from this approach. Based on the principle that governments fund things that do useful jobs, Defence has an obvious interest to set out the case for how it continues to promote regional stability. In doing so, Defence needs to rethink the current modest levels of funding for its Defence Cooperation Program, a core part of how the ADF engages with regional militaries via joint exercises, training and officer exchanges, and provide a dramatic step-up in funding for engagement. Notwithstanding pressures to cut civilian numbers, the International Policy Division should receive a staffing boost. IP currently stands at around 120 people—it was closer to 160 in the ‘peaceful’ 1990s. Resources need to go to the emerging priority areas. Read more

Most critically Defence needs to set out some detailed thinking about how it will go about deepening relations with key friends and allies. Defence Minister Stephen Smith’s announcement in Japan that the two countries will agree a framework for defence technological cooperation is an important pointer to the future of that relationship. Given the important position Australia has in Japan’s defence thinking (an entire chapter was dedicated to Australia in the most recent white paper), it seems there is willingness on both sides for deeper defence cooperation. Binskin also highlighted the level of Indonesian involvement (for the first time, in fact) at the recent Exercise Pitch Black 2012, a multinational air power exercise. Funding for defence cooperation with Papua New Guinea sharply increased in the last budget. These are but a few of the big changes taking place so there’s a positive story to tell about Defence’s own repositioning towards Asia.

This points to the reality that the next Defence white paper needs to have a stronger focus on posture—that is, what it does with the capabilities it actually has, rather than planning for the capabilities it doesn’t have and, on current funding plans, will get less of over a longer period.

In many respects, the planning for a reinvigorated defence engagement strategy on the region will suffice for a potentially missing chapter to the long-awaited Australia in the Asian Century White Paper, where Defence was inexplicably marginalised in the development of the report.

Andrew Davies:

During his speech to ASPI last night, Air Marshal Mark Binskin referred several times to the return on investment that Australia gets from the money it spends on its defence forces. At these functions I usually try to let the Q&A be between our speaker and our members and guests, but I couldn’t let that one go, so I asked—slightly tongue in cheek—what the rate of return is, and followed up with a more serious question of how you’d measure the value for money.

VCDF responded that it’s not possible to quantify the value, but gave a very good example of how having high-end military capabilities can act to develop stronger ties between nations. He cited the support that Australia was able to give to Japan in the wake of the earthquake and tsunami. Our C-17 airlifters were able to deliver outsize equipment vital for the relief effort and deploy search and rescue teams within a day or two of the event—and made us one of very few nations that could make a contribution of that sort. In Binskin’s view, it’s no coincidence that Australia–Japan relations are warmer now than ever, and are marked by a growing willingness to cooperate in areas such as military technology exchange.

There’s no reason to doubt that interpretation, and we’ve seen a similar sincere gratitude come though in ASPI’s discussions with Japanese officials, think tanks and academics since then. So I’m happy to concede that he’s right on that point. But I’m less convinced about the inability to quantify the return on investment in military capabilities. If that was really true, how could governments ever decide where to make marginal investments?

In his thoughts above, Peter Jennings makes a case for expanding the size of International Policy Division within Defence, to further boost the ability of the Department to support defence cooperation and regional engagement. But the question to be asked is whether that investment is the best one that can be made with the extra funds? Would a similar expansion in DFAT to boost their regional engagement program be more or less effective? Of course, these aren’t binary choices, and the right answer might be a bit more of both—but the question of marginal investment always needs to be thought through.

Consider a hypothetical in which the government has $100 million unallocated in its budget deliberations. If it was looking to boost its regional diplomatic/engagement effort, it might choose between supplementing Defence ($24.2 billion in the 2012–13 appropriations) and DFAT ($1.45 billion). The extra money would constitute a 7% boost for DFAT, but less than half a percent to Defence. It might still be the case that Defence offered the best return—but it’s far from clear, and in the absence of metrics that allow an estimate to be made, it would come down to a judgement call. And of course that all presupposes that boosting diplomacy is preferable by some measure to increased expenditure on health or education.

Other government portfolios are subject to at least some analysis of the value the country gets back. As a couple of examples, education programs can be benchmarked via productivity measures, and the cost of preventative health programs can be weighed against the reduced demand for health services later. Mark Thomson sketched some ideas for how we might do a cost-benefit analysis for Defence expenditure a few weeks ago and argued that Defence shouldn’t be exempt from the same scrutiny as other aspects of government spending. Having thought through the VCDF’s speech, I’m coming around to Mark’s point of view.

Natalie Sambhi:

Following the theme of regional engagement that both my colleagues raise above, in listening to Air Marshal Mark Binskin’s speech I was interested in how Australia might expand this engagement in future. Of note was this quote from VCDF:

Australia’s changing strategic circumstances means that in the coming years, the ADF needs to build a defence capability that can support our national security interests in a neighbourhood that is growing more capable, more confident and more outward looking.  At the same time, we need to accommodate constraints on the resources we have available to do this and live within our means.

Parts of our region might be growing more capable, more confident and more outward looking but, as I recently argued, that’s not something that Australia has to necessarily grow anxious about. Recognising the potential of regional partners, particularly Indonesia, is one way to maximise our capabilities in context of changing strategic circumstances and future budgetary constraints.

Indeed VCDF underscored the return on investment (however quantified, see Andrew Davies’ section above) of ‘credible high-end capabilities’ by assisting Australia’s regional influence. During question time, Binskin gave the example of Indonesia’s participation in Exercise Pitch Black 2012. He noted that only when other nations sent their high-end capabilities (in Indonesia’s case, their Sukhoi Su-30 and Su-27 fighter jets) do we start to see the levels of trust required for deep cooperation.

Looked at that way, it pays to reframe the discussion of the modernisation of regional militaries less in terms of an erosion of Australia’s technological edge and more in terms of an opportunity for deeper regional engagement and strategic complementarity.

Peter Jennings is executive director of the Australian Strategic Policy Institute, Andrew Davies is senior analyst for defence capability at ASPI and executive editor of The Strategist, and Natalie Sambhi is an analyst at ASPI and editor of The Strategist.

Trouble at the docks? (part II)

Earlier this year, Mark Thomson and I wrote a paper that highlighted the challenges in maintaining continuity in Australia’s submarine force. One of the things we didn’t discuss at any length in that paper was the simultaneous challenge in maintaining the workforce required to actually build whatever future submarine is chosen. As Mark pointed out recently, the workforce that’s currently building the Air Warfare Destroyers (AWDs) is already nearing its peak. Even with the deferred delivery times announced recently, the demand for the workforce will have pretty much dissipated by 2019 at the latest.

That’s a problem. If a decision on the future submarine was made today—and it won’t be—work wouldn’t start on a build until around 2020, even with a very favourable timetable. So the naval shipbuilding workforce faces what’s sometimes called a ‘valley of death’—a period in which there’s no warship work around. Of course, given the skills shortage in the wider economy, the folk involved aren’t likely to be unemployed long. They’ll simply find themselves working elsewhere. Read more

Shipyard productivity isn’t something you can just turn on and off. The RAND Corporation has benchmarked the performance of shipbuilders as a function of the number of years’ experience that they have. There’s a clear improvement of productivity as experience is gained—a brand new worker is less than one third as productive as a ten-year veteran (see the graph below.) Conversely a workforce that’s new to the job won’t meet best practice. We’ve probably seen the consequences of that in the AWD program; a shipyard that did sterling work turning out Anzac frigates in the 1990s has struggled with the basic construction of hull modules for the latest generation of ships. The net result has been a delay to the delivery of the vessels and a redistribution of work among the participating shipyards.

Shipyard productivity curveSource: based on data in RAND report MG725 Sustaining key skills in the UK naval industry

So there’s an incentive to keep at least some of the workforce involved in the business of building naval vessels until the future submarine comes along. The question is how we do that? One school of thought is that we should continue production of AWD hulls, fitted out as the future frigates that will replace the Anzacs. By bringing that forward, the idea is that the yards will continue to have an assured workflow, with benefits in retention of the skilled workers and managers we’ll need for the submarines. Other benefits would include a level of commonality of vessels and their basic systems (propulsion, power and housekeeping systems at a minimum) across the fleet. Those benefits are likely true, but the real question is whether that’s an efficient plan overall, once the costs as well as the benefits are taken into account.

Those costs include the earlier than planned retirement of the Anzacs that would inevitably follow, meaning that the costs of upgrading the Anzacs would be amortised over a shorter period and the larger vessels will likely have a larger crew. But the elements of the plan that need the most thought are the system requirements for the new frigates. The AWDs, like all surface combatants, are multi-role, but they’re optimised for wide area air defence. According to the 2009 Defence White Paper, the future frigates will have as their core task anti-submarine warfare (ASW), thus providing an overdue boost to a long neglected capability area.

At the very least, the Aegis air defence system will be replaced, meaning that the ships will need a new radar and combat system. As well, they would greatly benefit from a second helicopter, requiring some redesign in their superstructure. The sonar systems fitted to the AWDs should be quite capable, but mightn’t be the best solution for a dedicated ASW ship. All these changes are doable, but experience should teach us not to take any redesign and integration work for granted. There are also some engineering questions to be asked about the suitability of the AWD hull and propulsion systems for the ASW task, for which reduced radiated noise from heavy machinery and flow around the hull is required to reduce the detection range of the vessel by a hostile submarine. It might be the case that a modified AWD isn’t as effective in the role as a different design and the level of compromise would have to be looked at carefully.

The UK tested a similar idea in the first half of the 2000s, looking to take advantage of their Type 45 destroyer design as the basis for a future multi-role vessel. Many of the same advantages were being sought—continuity of work in shipbuilding and reduced fleet running costs. But as the concept was developed, the costs and risks of the modifications required were found to outweigh the benefits and the idea was quietly shelved.

That doesn’t mean it’s a bad idea for us to pursue. We’re starting with a different vessel, a different set of circumstances in our shipyards and different capability requirements. (Not to mention our strategic situation and national finances.) We need to do our sums. Letting the shipyard workforce run down before building it up again later has obvious costs, and the work of RAND and others will allow that to be quantified. And there’s likely to be political pain in seeing a significant part of some state economies wind down. But there are costs in moving to fill in the workflow gap by a program like an evolved AWD as well.

Like all expenditure of government funds, the correct approach is to do a cost-benefit analysis of the competing options. As unexciting as that might sound, if we don’t do that rigorously, we run the risk of letting the workforce tail wag the capability dog.

Andrew Davies is senior analyst for defence capability at ASPI and executive editor of The StrategistThis post is an excerpt of a talk presented at the Australian Defence Magazine Defence Workforce Participation Summit today.

Graph of the week: FMS myths vs the figures

Since the United States is our biggest ally, as generations of white papers have told us, it’s fair to say we want to be interoperable with their forces in a coalition setting. With this in mind, the Defence Materiel Organisation (DMO) on behalf of governments of the day has made excellent use of the Foreign Military Sales (FMS) framework to procure various platforms and technologies.

The DMO has been castigated by local industry for relying on the FMS framework at the expense of Australian solutions and companies. So I’ve spent the last few months pulling together FMS figures from the US and Australia to try and get a better picture of what the dollars look like. Below is a graph of the value of FMS cases between 2000 and 2012 to date as announced by the Defence Security Cooperation Agency (DSCA). (A table summarising the major purchases can be found at the end of this post.)

Australian FMS approvals 2001 - 2012Sources: DSCA notifications, with historical exchange rate and CPI corrections. Read more

In the US, Section 36(b) of the Arms Export Control Act (AECA) requires the President to give Congress advance written notification of the intent to sell defence articles, equipment and services. The DSCA prepares and delivers the notifications to Congress only with the approval of the State Department.

Once Congress has been notified of a proposed arms sale, the President must publish an unclassified version of the notification in the Federal Register. Thus, DSCA announces the details of the proposed deal. This doesn’t cover every single FMS cases that passes through the system but it gives a pretty good indication of the acquisition efforts.

For one thing, there aren’t near as many as I would have thought. Figures from our own department confirmed that between 2000 and 2011, 714 FMS cases passed through the system. The rough breakdown between sustainment and acquisition was about 50/50 but by value acquisition is the lion’s share.

The other fact to come to light that was of the hundreds of FMS cases put to the US, only 10 were not progressed. So once the DSCA makes an announcement that we’re interested in something, we tend to get it, regardless of the competition rhetoric in Australia.

The pros and cons of FMS are many varied but the moral of the story is:

  • Yes, Australia makes use of FMS
  • No, we don’t use it all the time
  • Yes, Australian content is limited to sustainment for the most part
  • Yes(?), there is sometimes no other way to access the technology.

For another view of FMS, ASPI’s 2012–13 Defence Budget Brief contains data collated by Mark Thomson. His graph showed the actual in-year spends rather than the approvals. For example, the $3.1 billion for the Super Hornet approval inn 2006 was spent over the following five or six years. The two views are complementary.

And, from the ‘shameless plug’ department, you can read more about the wider story in my magazine next month.

Katherine Ziesing is editor and sometimes promoter of Australian Defence Magazine, an independently published magazine on Defence capability and procurement. She is also a board member of the Sir Richard Williams Foundation, an air power think tank.

Table. Major Australian FMS purchases 2001–2012

Year

Project name

Project value
2001 Joint Tactical Information Distribution Systems
Class 2H Airborne Terminals
$64,000,000
2001 HARPOON Shipboard Launcher
Command Launch Control Systems
$37,000,000
2002 RGM-84L Harpoon Missiles $90,000,000
2002 JAVELIN Anti-Tank Systems $106,000,000
2003 Combat Control System MK2 Block 1C Mod 6 Tactical Subsystems $75,000,000
2004 M1A1 AIM Tanks $475,000,000
2005 SM-2 Block IIIA Standard Missiles $315,000,000
2005 AEGIS Weapons Systems $350,000,000
2005 Standoff Land Attack Missile-Expanded Response Missile Systems $430,000,000
2005 Joint Air-to-Surface Stand Off Munition $163,000,000
2006 MK 41 Vertical Launch Systems $1,000,000,000
2006 C-17 GLOBEMASTER III Aircraft $2,000,000,000
2007 Weapons for F/A-18E/F Super Hornet Aircraft $617,000,000
2007 Modular Artillery Charge Systems (MACS) $40,000,000
2007 F/A-18E/F Super Hornet Aircraft $3,100,000,000
2008 Follow-On Support for F/A-18E/F Aircraft $1,500,000,000
2008 M777A2 155MM Light-Weight Howitzers $248,000,000
2008 AEGIS Combat System Components for Air Warfare Destroyer Program $1,150,000,000
2008 Large Aircraft Infrared Countermeasures
(LAIRCM) Systems
$100,000,000
2008 Modular Artillery Charge Systems, XM982 Block Ia-1 Excalibur Projectiles $58,000,000
2009 USAF C-17 Globemaster Sustainment Partnership $300,000,000
2009 CH-47F Chinook helicopters $560,000,000
2010 MK 54 Lightweight Torpedoes $169,000,000
2010 MH-60R Multi-Mission Helicopters $2,100,000,000
2010 RQ-7B SHADOW 200 Unmanned Aircraft Systems $218,000,000
2011 C-27J Aircraft and Related Support $950,000,000
2011 C-17 GLOBEMASTER III Aircraft $300,000,000
2011 AIM-120C-7 Advanced Medium Range
Air-to-Air Missiles
$202,000,000
2011 C-17 GLOBEMASTER III Aircraft $300,000,000
2011 Sustainment for MH-60R Helicopters $1,600,000,000
2011 SM-2 Block IIIB STANDARD Missiles $46,000,000
2012 EA-18G Airborne Electronic Attack (AEA)
Aircraft Modification Kits
$1,700,000,000

India threat?

Navy Week celebration at the gateway of IndiaIndia is presently investing in a sustained program of military modernisation. Some $40bn was earmarked for defence in the budget for 2012–13, with a significant proportion to be spent on new weapons. This year, according to SIPRI, India became the world’s biggest arms importer, and its long ‘wish list’—including fourth-generation fighters, heavy-lift aircraft, attack helicopters and main battle tanks—suggests that it will remain in that position for years to come.

These numbers, however, tell only part of the story. Some of this modernisation program involves upgrades to defensive capabilities, but not all. The mix also includes three new aircraft carriers (a refurbished Russian ship should eventually be delivered in early 2013, with two indigenous carriers soon to follow), nuclear submarines (a leased Russian Akula-II class boat plus a new Indian one) and air-to-air refuelling tankers (six soon to be ordered), as well as those multi-role combat aircraft, transports, helicopters and tanks. Many of these are systems designed more for power projection within and beyond India’s immediate region as well as for territorial defence.

In scale and spend, India is matching parts of China’s longer-running and more expensive modernisation program. In others areas—aircraft carriers and air-to-air refuelling, for example—India is arguably acquiring superior capabilities. Yet while China’s military modernisation is generally considered a cause for cause alarm, India’s program is not. Why? Read more

One recent study by George J. Gilboy and Eric Heginbotham, Chinese and Indian Strategic Behaviour, gives a simple answer: when it comes to India, we’re fooling ourselves. They argue that there is an ‘India Threat’ to the security of the Indo-Pacific region on a par with that posed by China.

They also assert that India has much more in common with China than most Western observers think, including; a strategic culture that emphasises ‘veiled Realpolitik’, for instance, a telling history of using force to settle disputes, and a ‘preference for offensive military doctrine’. India’s strategic behaviour, they think, ought to generate the kind of ‘alarm’ that China’s does. They urge Westerners not to be distracted by the blandishments of ‘democratic peace theory’ or windy rhetoric about shared values, and suggest instead that they acknowledge the very real threat India might pose to regional stability.

Understandably, this argument has had a mixed reception in New Delhi. The highly-respected scholar Swaran Singh asserted in a prominent review in The Hindu newspaper that the book might speak with an ‘American voice’, but in a ‘Chinese accent’. In another review, the veteran strategist C. Raja Mohan expressed some doubts about the thesis, but thought it might have the positive effect of showing what Americans really think about India. Hopefully, Mohan argued, the book might shock sections of India’s elite into a more ‘pragmatic’ view of the strategic partnership with America and give it a better sense of the limits of that relationship.

Mohan’s point is apposite: the notion of an ‘India threat’ has emerged in a difficult stage in the ongoing rapprochement between India and the US. It hands ammunition to the many Indian critics of the strategic partnership, who argue vociferously that American foreign policy is exploitative and fickle, and that India is unwise to commit itself to that arrangement.

But the ‘India threat’ also contradicts most other assessments of India’s military modernisation and strategic intentions, including Stephen P. Cohen and Sunil Dasgupta’s excellent 2010 book Arming without Aiming . These assessments emphasise two points; first, that India remains a relatively weak military power and, second, that its strategic behaviour is characterised by restraint, even in the face of serious provocation. India is modernising from a low base and must import arms because its defence industries are mostly incapable of providing what it needs. And, as Cohen and Dasgupta show, India presently lacks both the will and the means to be more assertive in its own immediate neighbourhood or further afield. Ultimately, the ‘India threat’ rings hollow.

Ian Hall is a senior fellow and the acting head of the Department of International Relations, Australian National University. Image courtesy of Flickr user $wap.

New Zealand: washed in the blood of the lamb?

I read with interest Robert Ayson’s take on the mending of relations between the United States and New Zealand. Rob believes that New Zealand is the prodigal son from the Good Book, welcomed home by the doting parent despite the other son’s (Australia’s) resentment. But there are three parables in Luke Chapter 15. And given the Land of the Long White Cloud’s heavy dependence upon four-legged beasts who are white and woolly, perhaps it might be appropriate to rehearse the parable of the lost sheep (Luke, 15: 4-7). The finding of the lost sheep is a metaphor for a sinner’s repentance; the lesson being that there is more rejoicing in heaven over one sinner who repents than over ninety-nine righteous persons who do not need to repent.

This message of a sinner’s repentance can also be found in the parable of the lost coin (Luke, 15: 8-10). And if Professor Ayson re-reads his own parable of the prodigal son I’m sure he will find a similar theme there too. The younger son tells his father than he has ‘sinned against heaven and before thee, and am no more worthy to be called thy son’ (Luke, 15: 18-19).

All three parables make the same point: that the sinner who repents may be washed in the blood of the lamb. None says anything about sinners who don’t repent. Since New Zealand shows no sign of abandoning its anti-nuclear policy, perhaps we have to look for its ‘repentance’ in other areas. A case could be made that New Zealand has attempted to help carry some of the weight in Afghanistan and more so in the South Pacific. And Washington certainly has no pressing need to bring nuclear-armed vessels into New Zealand’s ports. But the return of strategic cooperation seems likely to be on a case by case basis.

On a final point, I would say that Rob is wrong if he believes that Australia resents—and opposes—New Zealand’s return. It is in Canberra’s interest to have Wellington on board in relation to common strategic interests, and for New Zealand to bring what weight and influence it can to shared positions. The brutal truth though, is that it can’t bring much weight—so it’s very much in Canberra’s interest, as in Washington’s, to know when and where Wellington sees itself as indulging in ‘riotous living’ (Luke, 15:13) and when and where it sees itself as a strategic player.

Rod Lyon is a non-residential fellow at the Australian Strategic Policy Institute.

More than words: Australia–Indonesia strategic relations

Two Australian No. 77 Squadron F/A-18 Hornet Aircraft welcome Indonesian Air Force (TNI AU) Sukhoi Su-30 & Su-27 Flanker aircraft into Darwin to participate in Exercise Pitch Black 2012.

Australia’s leaders from both sides of politics have been paying greater attention to Indonesia; there’s been more official engagement, as well as new diplomatic and defence initiatives in the past year. And we’ve been describing Indonesia, as our Defence Minister has during his Jakarta visit last week, in more important terms like ‘strategic partner’.

But it looks like that there’s some way to go before ‘strategic partner’ becomes more than just a term of endearment. If we look at the 2009 Defence White Paper (for the time being still the government’s defence strategic policy), we find a curious ambivalence towards Indonesia. According to the White Paper, we have a ‘fundamental interest in controlling the air and sea approaches to our continent’ (paragraph 5.5). But in reference to a secure immediate neighbourhood, it says we should prevent or mitigate ‘nearby states [from] develop[ing] the capacity to undertake sustained military operations within our approaches’ (paragraph 5.8). There’s a contradiction there; as Hugh White notes in his Security Challenges essay (PDF), it may very well be those same capabilities Indonesia requires to ensure its own security in its northern approaches that could be instrumental in both Indonesia and Australia securing their strategic interests.

In short, the language of the 2009 Defence White Paper simply doesn’t match our statements of Indonesia as a strategic partner. Read more

 And although there are asymmetries in our capabilities, a strategic partnership means allowing and encouraging Indonesia to grow in a way that complements our strengths and compensates for our weaknesses so that we can work together; if Indonesia is to play an important role in our strategic future, then actively mitigating or preventing particular capacities isn’t the way to go.

This position might have been justifiable in white papers released after Konfrontasi (during which Australia and Indonesia found themselves on opposing sides of the conflict) or shortly after the 1999 East Timor intervention, during which relations with Indonesia were more fractious and the military (TNI) was only just exiting Indonesian politics. But times have changed.

On the domestic front, Indonesia is a much more stable, democratic state. In economic terms Indonesia is now starting to flex its muscle. Its GDP grew by an annualised 6.4% in the second quarter of 2012, its economy is now larger than Australia’s in purchasing power parity terms, and its middle class is larger than Australia’s population. TNI no longer exerts the same level of direct influence on politics and there’s a greater commitment to crack down on corruption. In regional terms, Indonesia enjoys greater clout and has attracted the attention of international partners such as the United States, the United Kingdom and China. Recent participation in RAAF-hosted Exercise Pitch Black 2012 (see image) shows Indonesia’s willingness to engage with partners such as Australia by sending their newest aircraft to build person-to-person ties and to dispel doubt as to their military intentions.

Barring a significant change in Indonesia’s trajectory of growth and domestic transformation, this is likely to become an enduring externality for Australian policy. Nonetheless, it’s worth thinking through the factors that could cause problems for Indonesia down the track: these include slowed growth, a change of leadership to one that is more internally focused, and deteriorating domestic stability. The question is whether these eventualities would adversely affect the Indonesia–Australia relationship in the long term or would merely slow the engagement temporarily. That said, the relationship between Indonesia and Australia seems to be on an unstoppable path of growth. A nationalist President of Indonesia would be a concern but wouldn’t necessarily require a radical rewrite of Indonesia’s place in our strategic interests. In any case, as one RSIS commentator notes (PDF), nationalism at present is not a call for concern.

Likewise, Australia can cause ructions over livestock, people smuggling or the incarcerations of Australians, but the fundamental shared interests should ultimately prevail. In terms of shifting regional geopolitics, Australia and Indonesia might have more in common in the future Asia as we both navigate China’s rise and the US rebalance. A Defence Cooperation Agreement signed recently between Australia and Indonesia provides a framework for practical cooperation on common security matters, but it’s time to work together as well on bigger, long-term strategic questions about the region.

Indonesia demands different handling in the next Defence White Paper, which is as much an opportunity as the Asian Century White Paper to correctly recognise Indonesia’s place. Language matters, because it sends a strong signal to both the Australian and Indonesian people about how we see each country’s place in the region. And while the majority of everyday people in each country may not delve into the pages of the White Paper, setting the tone for political interaction as well as doing away with ambiguous language remains important. Hopefully the 2013 White Paper will articulate Indonesia’s importance and elevate it to partner status rather than a subordinate. That sort of constructive language would remove the disparity between language of the 2009 White Paper and the increasing importance of close defence relations and alignment of strategic interests between the two nations.

The White Paper might start by recognising the complementarity across our capabilities, strengths and weaknesses. Or it could, as Hugh White suggests, create a heading for Indonesia separate from the rest of ‘our neighbourhood’ to recognise the important role it plays in our strategic environment. While there’s no prospect of an alliance between our countries in the foreseeable future, it would provide a more robust basis in our national policy to give a broader context to initiatives such as the recently signed Defence Cooperation Agreement.

Defence Minister Smith assures us that he is ‘committed to regular, open and transparent discussions with Indonesia on the development of Australia’s 2013 Defence White Paper’. Let’s hope the final cut pays them the same due respect.

Natalie Sambhi is an analyst at ASPI and editor of The Strategist. Image courtesy of Department of Defence.

Mind the gap, Mr Abbott

Tony Abbott visits an ACPB

Tony Abbott’s speech today to the RSL National Conference sets out some important pointers on the shape of defence policy under a future Coalition government. On spending, it’s been clear for some time that the Opposition had no intention of immediately reversing the cuts announced in the last budget. Abbott said:

Any savings that the Coalition can find in the defence bureaucracy will be reinvested in greater military capacity. Our aspiration, as the Commonwealth’s budgetary position improves, would be to restore the three per cent real growth in defence spending that marked the final seven years of the Howard government.

An ‘aspiration’ to return to spending growth is better than no prospect of growth, but it holds out little hope for a return to growth soon, and one must presume that the 3% growth will start from the newly established lower spending base. (See post below ‘Table of the week’ for a calculation of the effect of 3% real growth on the Defence budget.) Read more

It’s to be expected that the Opposition would look to make savings from the defence bureaucracy but encouraging that no arbitrary saving figure was announced. Indeed Abbott’s speech is remarkably cautious in the way it doesn’t commit to a number of iconic projects. There’s no explicit commitment to twelve submarines or 100 Joint Strike Fighters, only a commitment to making decisions about them within 18 months of an election:

This is not a decision … that can be made from opposition. Within 18 months of an election, an incoming Coalition government would make the short and medium term decisions necessary to ensure that Australia has no submarine capability gap.

The other big procurement decision is the timing of our acquisition of the Joint Strike Fighter. Again, without detailed operational advice, this is not a decision that an opposition can make but we will make it within 18 months of a change of government.

Very sensibly the Opposition wants to look at the books and the detailed information held by the project office before making big decisions.

There’s an additional 18-month commitment in Abbott’s speech:

Within 18 months of an election, an incoming Coalition government would publish a new Defence White Paper with costed, affordable ways to meet Australia’s defence and national security objectives.

A change of government would therefore consign the projected 2013 White Paper to a shelf life of just months. Defence officials shouldn’t despair though, because it’s difficult to see major policy differences emerging. For example, Abbott anticipates ‘basing more of our military forces in Northern Australia’, which is hardly a million miles away from Stephen Smith’s own thinking.

The biggest commitment in Abbott’s speech relates to submarines and ensuring ‘… that Australia has no submarine capability gap.’ Behind that simple sentence lies an enormously difficult task: how to span the widening gap between the likely end of life of the Collins boats and the Sea 1000 replacement. That will be the big capability task over the next few years. An interim submarine capability, either in the form of a life-of-type extension for Collins or a rapid acquisition of another type, will absorb every aspirational Defence spending increase that can be thrown at it. It’s a critical task and work on it can’t start soon enough.

Peter Jennings is executive director of the Australian Strategic Policy Institute. Image courtesy of Flickr user Royal Australian Navy.

Table of the week: how much is 3%?

Just to put into perspective what a 3% real increase in the Defence budget amounts to over a decade, the table below shows how a baseline budget of $25 billion would evolve over ten years under that arrangement. All figures are in billions of this-year dollars.

  Yr 0 Yr 1 Yr 2 Yr 3 Yr 4 Yr 5 Yr 6 Yr 7 Yr 8 Yr 9 Yr 10 Total
Base 25 25 25 25 25 25 25 25 25 25 25 275
+ 3% 25.0 25.8 26.5 27.3 28.1 29 29.9 30.7 31.7 32.6 33.6 320.2
Extra 0.00 0.75 1.52 2.32 3.14 3.98 4.85 5.75 6.67 7.62 8.60 45.19

 

ASPI answers a letter from a reader

Dear ASPI,

I have a ‘friend’ who has an embarrassing problem with defence planning. It seems no matter what he tries, it ends up expensive and unsatisfactory. What can he do?

Worried of Parliament Hill

Dear Worried,

You should console your friend that he is not the only one having these sorts of difficulties—in fact, it’s almost de rigueur in defence (PDF) (or defense) circles. But I know how uncomfortable this can be when a big event like forming government after an election is looming.

Alas, there’s no magic formula for fixing it. But there are some things that might help. Here’s a dos and don’ts list for approaching defence acquisition (with some suggested ASPI reading).

Do

  • have a close look at ‘80-20 solutions’—those applications of (relatively) simple and (relatively) cheap technologies that give a fair proportion of the capability of more expensive systems at a fraction of the price. For example, surveillance is an area where a mix of long-range, very capable platforms could be supplemented by cheaper shorter-range ones.
  • take a whole of nation view of capability where appropriate. Defence isn’t the only stakeholder in aspects of national security such as border protection and in cyberspace.
  • be transparent in your defence policies and acquisitions. There will be times when you don’t like this—and the Defence Department certainly won’t—but it will be better for us all in the long run. Mark Thomson and Leigh Purnell’s 2010 report has some good pointers.
  • understand the nature of fixed and marginal costs in defence procurement—having a large number of small fleets means a lot of overheads and runs the risk of insufficient capacity in any given area.
  • wherever possible, stick with the now tried and true avenue of procurement of proven systems from a close ally under the American Foreign Military Sales process.

Don’t

  • be seduced by the lure of high-end technology for its own sake; keep the focus on what you want the forces to be able to achieve and remember that it isn’t done in a vacuum; the capability of credible adversaries is a consideration, as is the location of operations. Projecting power against Australia is a formidable task.
  • rush white papers—they have a tendency to come back and bite a few years down the track. In particular, take the time to get the funding as right as possible, because Mark Thomson will soon find out if you don’t.
  • conflate defence policy and industry policy. Whether we like it or not, the worldwide defence industry landscape is increasingly dominated by a handful of multi-nationals. Swimming against the tide will only run down our resources faster and is at odds with our national strategy over the past half century.
  • defer to advice from the Department when your instincts say differently. We’ve seen what happens when it’s left to its own devices.
  • attempt to hide a back step in defence planning/policy by pretending that it was all part of the grand plan—admit the change up front (as the press and others will identify it for you anyway) and explain the reason for it.

Andrew Davies is senior analyst for defence capability at ASPI and executive editor of The Strategist.

New Zealand after Panetta: Australia’s prodigal brother

US Secretary of Defense Leon Panetta and NZ Minister of Defence Jonathan ColemanIf I understand Peter Jennings correctly, his response to Leon Panetta’s visit to New Zealand consists of three parts. First, there is a touch of bemusement about how far the United States has bent over to get New Zealand into the tent. Second, there is the stern message that being an ally today is much harder than New Zealand might remember it: what matters now is what you bring to the table as Australia knows from hard experience. Third, while the improvement in US–NZ relations is welcome in Canberra, the US–Australian relationship is too big and important to let the little New Zealanders rejoin the high table. As he concludes: ‘the Kiwis aren’t quite there yet.’

This logic reminds me of the parable of the prodigal son. The younger son, who had besmirched his family’s good name by years of wild living, is welcomed back by his father, who puts a ring on the lad’s finger and has a calf fattened for the celebratory feast. But the older son, stunned by this act of complete grace, complains that he himself has been slaving away loyally for years without receiving remotely similar treatment. According to the New International Version translation of the book of Luke, the father replies, ‘you are always with me, and everything I have is yours. But we had to celebrate and be glad, because this brother of yours was dead and is alive again; he was lost and is found. Read more

If I were an American official looking towards the ‘southern anchor’ of its US alliance system, I would not doubt even for a minute that Australia is ‘always with me.’ But New Zealand has been different. The younger member of the alliance had left the family fold in the mid-1980s (or been shunned for standing up to its principles, according to some Kiwis). New Zealand had been knocking on the door again with its contributions in various places, including Afghanistan. And at a certain point the United States realised it was simply counterproductive not to have a more active relationship despite this difference of opinion. This was not about grace, however. It was about self-interest; there is no such thing as having too many close partners when you are worried about China.

And the US has certainly bent over backwards. Leon Panetta virtually purred when he was in Auckland. ‘Yes, your ships can now use our military facilities.’ ‘No, you don’t have to reciprocate by trashing your own nuclear policy and allowing our ships in.’ ‘Only do what you are comfortable with.’ ‘Of course if you want some Marines, well that can be arranged.’ ‘We’re here to help, but at a pace that works for you.’

This looks like good diplomacy to me. But it may sound a bit strange in Canberra if you are used to a major power ally that does not ask whether you are on the team but how much are you going to contribute. Yet this is not what the warming US–NZ relationship is really all about. There are certainly areas of practical collaboration which are being worked out. Some of these are in the South Pacific, where there was a recent trilateral meeting involving Hillary Clinton at the recent Forum in the Cook Islands. Some more dauntingly have to do with maritime cooperation in the wider region, which if they are not handled well could get New Zealand into some deep water. But the main prize for Washington is a closer relationship with a country that has long had an independent spirit, and has endorsed the pivot. Having New Zealand on side (and the Washington Declaration is a strong statement of alignment if not a formal alliance) is a hard ball get. That’s the same New Zealand that has a free trade agreement with China, plenty of contacts but not too much baggage in the South Pacific, and a good reputation for supporting multilateralism. It was never about our strategic weight, something Australia is expected to offer in at least small portions.

If I was in Washington I would be extremely pleased with Panetta’s visit. All the right buttons were pushed. In Wellington I’m wondering if New Zealand has been cashing in some of our hard won independence chips a little too cheaply. If I was in Canberra, I would be wondering whether New Zealand really has any interests at all in being quite back at the top table. It actually suits John Key’s government to have New Zealand’s nuclear free stance stand in the way of a full resumption of ANZUS. An informal and incomplete alliance relationship with the US is much more compatible with good relations in Asia with a rising China. We can walk and chew gum at the same time, at least for now. If this means that New Zealand doesn’t face some of the same expectations from Washington that Australia shoulders, even better. So don’t worry Peter: AUSMIN and Australia’s number one ally status in this neck of the woods are safe for some time to come. Fattened calf anyone?

Robert Ayson is director of the Centre for Strategic Studies at Victoria University of Wellington, New Zealand. Image courtesy of Flickr user Secretary of Defense.

Leon Panetta rubs noses in Auckland

Secretary of Defense Leon Panetta in New ZealandThose who doubt America’s commitment to ‘rebalancing’ its strategic priorities to the Asia-Pacific should consider the effort Washington is making to strengthen ties with New Zealand. US Defense Secretary Leon Panetta’s visit to Auckland on 21 September culminates a two-year process to bring Wellington back to an alliance-like level of defence cooperation with the United States and, in Panetta’s words, ‘to make a new era’ in relations between the countries.

It’s been a generation since a US Defense Secretary was last in New Zealand—Caspar Weinberger visited in 1982. For the intervening thirty years New Zealand’s anti-nuclear policies and its ban on US naval ship visits (because they might carry nuclear weapons) put most defence cooperation into the deep freeze and ended trilateral cooperation with Australia under ANZUS. (Although, while the most public aspects of cooperation were curtailed, behind the scenes some intelligence cooperation continued—or indeed increased—as a result of New Zealand’s commitment to the Afghanistan operation.) Read more

In Auckland Panetta, who had also visited Beijing and Tokyo, ended a reciprocal US ban on the Royal New Zealand Navy visiting US ports; the last time New Zealand participated in a Rim of the Pacific  Exercise (RIMPAC) its ships couldn’t enter a US harbour. Now that Panetta has invited the PLA to participate in the next RIMPAC, perhaps in 2014 we’ll see a Kiwi frigate dock alongside a Chinese warship in Pearl Harbour. But New Zealand’s Minister for Defence Jonathan Coleman said that their port access ban would not be rescinded. A policy difference once big enough to break the alliance is now quietly ignored by all parties.

Although Wellington’s anti-nuclear port access ban still rankles in some circles in the US Navy, at PACOM and (it must be said) in Canberra, this hasn’t stopped a resurgence of defence cooperation between the US and New Zealand. The Washington Declaration on Defence Cooperation (PDF), signed by Panetta and Coleman on 19 June, sets out plans ‘to focus, strengthen and expand the bilateral relationship.’ This includes a regular strategic dialogue, and a multi-pronged focus on maritime cooperation, including strengthening deployable capabilities, contingency planning for humanitarian assistance and disaster relief, and participating in multilateral defence engagement.

The ardour with which the United States has pursued New Zealand has puzzled officials in Canberra, but a warmer relationship is welcome. It remains to think through the implications of this new level of cooperation for all three countries. For Wellington, a return to closer cooperation with the US carries with it the need to meet higher American expectations of its friends and allies. Gone are the days of alliance cooperation sustained by sentimentality about World War II. In this more transactional age an ally is only as credible as its last big commitment to the relationship. In practical terms the New Zealand military will also discover that meeting the demands of basic technical interoperability with the US carries a large price tag. Panetta observed that the two countries were ‘close friends – yesterday, today and tomorrow’ but there will be an increasing cost for the ‘tomorrow’ part.

Australia’s bilateral defence relationship with New Zealand is good but our very closeness allows us to be lazy and not push the limits. That’s visible in our less than seamless cooperation in the Pacific; after the 2009 tsunami, for example, our mutual relief efforts towards Tonga and Samoa were as competitive as they were cooperative. Australian Defence White Papers have been devoting less and less space to the relationship as our own priorities have shifted north and as the New Zealand Defence Force became a less capable partner. The next Defence White Paper should revisit the relationship. New Zealand is an important partner in the Pacific and should be encouraged to work more closely with us in Melanesia. In Southeast Asia and beyond, and in multilateral groupings, New Zealand’s independent voice works to Australian interests. There is a lot more that we could do together in strengthening regional strategic cooperation. Much will come down to the budgets available to support a stronger regional presence.

For the US the political, diplomatic and military effort needed to strengthen engagement with New Zealand shows what’s necessary on a vast scale to make the Asia-Pacific rebalance sustainable. There is no substitute for regular senior-level engagement. It can’t be thirty years before a Defense Secretary visits New Zealand again.

Will we ever see a return to trilateral ANZUS-style cooperation? Something like that will surely have to happen in terms of military cooperation. At the political level, however, both Canberra and Washington get too much out of their bilateral AUSMIN consultations for this to be reformed into an ANZUS meeting. As close as New Zealand and the United States have become, there is still a huge gap between being ‘close friends’ and being alliance partners. And the Kiwis aren’t quite there yet.

Peter Jennings is executive director of the Australian Strategic Policy Institute. Image courtesy of Flickr user US Embassy New Zealand.

Indian perceptions of the Indian Ocean

In his June 2012 visit to India, Secretary of Defense Leon E. Panetta gave a speech that described India as central to the United States’ Indian Ocean strategy. As he put it:

‘America is at a turning point. After a decade of war, we are developing a new defense strategy for the 21st century, a central feature of that strategy is rebalancing toward the Asia-Pacific region. In particular, we will expand our military partnerships and our presence in the arc extending from the Western Pacific and East Asia into the Indian Ocean region and South Asia. Defense cooperation, defense cooperation with India is a linchpin in this strategy’.

India, however, has a ways to go before it becomes anybody’s linchpin. That’s because Indian perceptions of operations in the Indian Ocean are driven by two factors: an adverse reaction to expeditionary actions; and a real belief in creating multilateral task forces to create order in the region. Read more

Policymakers and defense planners in Delhi consistently point out that the word ‘expeditionary’, for the time being at least, is taboo, thus ruling out any joint operations with the United States that would lead to hostile reactions in the region. On the other hand, the Indians have been proactive in pursuing strategic partnerships with the countries in the Indian Ocean littoral, conducting joint military exercises with the Gulf Cooperation Council (GCC) countries, Singapore, Thailand, and Malaysia.

The Indian Navy has been the lead service in promoting Indian security interests throughout the Indian Ocean region and the service sees its area of responsibility stretching in the west to the Gulf and as far south as South Africa. As early as 2003 the Indian Navy provided maritime security during the African Union’s meeting in Mozambique. In the east the Navy recognizes that its area of operations extends to the Strait of Malacca, but not further south than that.

Indian interests are ruled by immediate threats like piracy, the transit of weapons of mass destruction through the Indian Ocean, and the prevention of sea launched terrorism. In all these cases the Indian government would prefer to work multilaterally with like-minded countries to eliminate these threats. The GCC forces, the ASEAN countries, South Africa, and Australia would be the logical partners in any such endeavor.

Working with regional actors is in India’s interest for two reasons. First, if multilateral forces can effectively work to contain and eliminate threats then it keeps the Indian Ocean region free of great power interventions. This has been a central plank of Indian foreign policy since achieving independence but it is only now that the Indian armed forces are slowly beginning to have the capability to act outside the South Asian region. Second, such multilateral arrangements, by their very nature, would not be formal alliances but instead cases of ‘plug and play’, in which coalitions emerge to counter particular threat scenarios.

Countering China

The long-term challenge for India remains countering the rise of China and its perceived incursion into the Indian Ocean. While the ‘String of Pearls’ strategy now receives less credibility, India remains concerned that China is deploying surveillance assets in the Indian Ocean region, seeking to lock down oil and other energy resources, and to prevent the rise of India to great power status. With these challenges in mind India is building up a naval capability that can counter Chinese naval incursions into the region. The Indian Navy is planning to have four nuclear submarines and four aircraft carriers to extend its maritime reach. In the event of a future conflict with China, Indian naval officers speak of disrupting Chinese oil flows from West Africa and the Gulf as they pass through the Indian Ocean region. India’s Tri-Service Command in the Andaman and Nicobar Islands, if equipped with strike aircraft such as the Su-30 with air to surface missiles, could potentially inflict significant damage on a Chinese naval force breaking out of the Strait of Malacca.

All this is based, however, on a creeping weaponisation process that is incrementally adding to India’s force projection capabilities. While India has leased two nuclear attack submarines from Russia, its own indigenous nuclear submarine program is some ways away from allowing the boat to enter service. The extent to which the China challenge can be countered, therefore, must be questioned.

‘Plug and Play’ with the United States

Given the extent of the China challenge and India’s unique political compulsions it’s likely that India, in the short to medium term, won’t be working as an alliance partner with the United States. On the other hand, resisting Chinese pressure will require a greater commonality of interests with the United States, since Indian forces on their own may have less success in deterring Chinese pressure.

India is likely, therefore, to continue building its relationship with the United States by plugging into specific operations that promote its national interest and allow it to help reduce threats that impact the greater Indian Ocean community. Humanitarian missions, UN operations, and anti-piracy and anti-terrorism measures would be the most likely areas of cooperation with the United States. This would increase cooperation between the two countries and help create uncertainty in Beijing about the true strength of the US–India relationship. At the same time, it would not impinge on India’s autonomy in foreign policy and, perhaps more importantly, not antagonise Beijing to the extent that it sought to take active measures against New Delhi.

But in the long run, Indian interests converge with those of the United States—something that is recognised in New Delhi. The Indians, however, would like more time and space to work out how this partnership can be truly beneficial to their country.

Amit Gupta is an associate professor at the USAF Air War College, Montgomery Alabama. The views expressed in this article are his own and do not necessarily reflect those of the United States Department of Defense or the United States Air Force. Image courtesy of Flickr user ussocom_ru.