In a recent speech to RUSI, Raytheon boss Michael Ward outlined how the Australian Defence industry had dropped from close to 30,000 people down to about 25,000 people over the last three years. Given the government would like to see 34,000 people upwards in that space over the coming decade I would suggest that the golden triangle for a skilled defence workforce is on very shaky ground.
‘In his July 2009 speech to the Defence & Industry Conference, the then Defence Minister, John Faulkner, predicted a defence industry workforce of 34,000 by 2013,’ Ward told his audience. ‘Much has changed since then but the reality is we will soon have a defence industry workforce some 30% smaller than the Government expected.’
Since this time guidance to industry has been a mixed bag. The White Paper of the day sent many a mixed message on the strategic outlook and the hows and whys of the wider defence landscape. Financial details were slim to be filled in at the budget and we all know how that went. Just read anything on ASPI’s site or blog by Mark Thomson on the Defence budget and the complete lack of detail on future spending. Rhetoric is great but the numbers just don’t match up.
Industry has received a number of planning documents to help them plan their business around defence demands. The Defence Capability Plan (DCP) and the Defence Planning Guide (DPG) offer a ten-year horizon on the programs to come. The information in this document has been changed and updated every six months or so to reflect the changes in dollars and approvals (or cancellations) as they happen.
The last Defence Industry Policy statement in 2010 (PDF) from then Minister for Defence Materiel Greg Combet was a short and sweet read. The moral of the story was that some dollars were spent on programs to support industry and get used to the fact that we don’t do offsets and nor will we again.
The Priority Industry Capabilities (PIC) framework was also introduced.
- PIC identify elements of broader industry capabilities that confer an essential strategic advantage by being resident in Australia and which, if not available, would undermine defence self reliance and Australian Defence Force (ADF) operational capability.
- PICs are defined in terms of industrial capabilities rather than specific companies and, ideally, healthy PICs should function without any special form of Government subsidy or intervention in the market.
- Under this policy an international company can establish a local workforce, infrastructure and intellectual property in Australia to develop or support a capability in a specific PIC area.
Under this framework, the DMO has been carrying out a number of health checks on the parts of industry that it deems worthy of support.
Apparently, all the easy PIC health checks are now out of the way with the harder ones remaining to report. These remaining PICs will no doubt need some form of support in order to remain healthy. What form of support has yet to be made clear. Talking to people inside Defence, the feeling is that there may be some re-programming of DCP programs to keep the ‘valley of death’ between programs swallowing skills that die from lack of work. Practice makes perfect. For example, it’s hard to practice your EW skills when there is one customer who only needs your hi-tech help every few years.
A new Industry Policy statement in 2013 will also support the upcoming White Paper. Just what it will cover remains to be seen. Unfortunately such documents have a history of being a really good read with many great ideas that lack funding and support from the wider Defence community. The cynicism is just too much to bear it seems.
The White Paper is not an opportunity for Defence to enunciate the finer details of how it will procure and sustain its capabilities. And nor should it be. But the realisation that the shopping list of capabilities needed to effect the outcomes it desires is supported by Defence industry, pressured by market forces. Getting the right people to the right place at the right time is not just for soldiers, sailors and airmen. It’s for welders, engineers and project managers too.
Katherine Ziesing is the Editor 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.