Small defence cuts make big splash

Cutting ten billion dollars in spending from the Defence Department sounds dramatic – until you notice it’s to be spread over ten years. Apart from the basic mathematical fact that this immediately reduces the cuts to just $1 billion a year, government money announcements – for both cuts and spending – that are spread over ten years have a strong tendency to be back-ended to the outlying years, which greatly increases the chances that by the time you get to year 6 or 7 a whole range of reasons have been found to justify a major change of plan.

Still, it is a small sign that perhaps the ideologically motivated symbolism that developed over the Howard years that somehow Defence should be quarantined from the cuts, constraints and efficiency measures that apply to every other area of government spending might finally be coming to an end. Having said that, despite these cuts the Labor government says it is still maintaining the previous government’s commitment to increase spending on defence by 3 per cent a year in real terms.

According to the Australian Strategic Policy Institute, Australia’s total budget for defence this financial year is $22 billion, an increase of $2.1 billion on last year. This decade, the defence budget has grown in real terms by 44 per cent, which equates to a compounding annual growth of about 5.3 per cent. 

The litany of major cost overruns for defence equipment is well known. As with any other operation, when there is a guarantee of continually growing funds and no expectation of cuts occurring down the line, it becomes more and more likely that large-scale waste and inefficiencies will occur. This is not to say that defence spending should never be increased – although personally I think we’ve spent a lot of money on equipment which shouldn’t be part of our national defence strategy – but rather it should be properly justified and more closely watched.

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17 Comments

  1. Is the ASPI ,civilian or Military persons in training!?You wouldnt know,how bored I am about Defense expenditure,it has dipped in my estimation,as worthwhile,like the Iemma government,and its plans.If 1 $billion of the dangerous squids,can be used every year to minimise the losses already accrued,it is just figures,as you and I know,and anyone that looks on.I find it very difficult to have to accept the new Minister and Rudd doing this stuff,and breathing in deeply and yahooing they are redeeming Defense from institutional rot.Must we have these pretences!?

  2. Maybe I am naive, but why the hell do we need to increase defence spending each year? Who are we protecting ourselves from? Add to this, the fad of having a budget surplus and I start to wonder how detached our elected leaders are from reality.
    Remember Kim Beazley going berserk when his daughter was kept waiting for 5 hours at the outpatients? Maybe our politicians need a dose of reality from time to time to get an idea of what really counts to most people.

  3. It seems Terry, that we are under constant threat from terrorists – which we know thta the defence force deters very well. And while it has been quiet, we never know when another boat load of dangerous refugees might appear off our north-west coastline.

  4. My understanding is that they want to cut the number of white collar workers in the Department of Defence, so they can recruit more uniformed personnel.

    I have one white collar worker from my family in Canberra. If they fire him, the Russians and Chinese will get into our security systems.

    My ex-husband is a white collar worker in Brisbane (software/hardware computer manager). I think he has one of the jobs that will go. It was mentioned to me recently. I’m sure they have uniformed people with similar capabilities, who work alongside him.

    Now it seems I am to have a son who is an Officer in the Armed Services as well.

    My 15-year-old says he will be heading off to the Australian Defence Force Academy as soon as he finishes high school. He intends to study Journalism.

    If I ask him not to go, he will be there with bells on – even more quickly.

  5. Hopefully, the Defence will stop buying junk and start saving money for a change.
    The Abrams’ military tanks which cost Australians well over a billion dollars are too heavy for our roads so they are totally useless. They are not amphibians so it remains a mystery as to the combat purpose of those tanks. Did we intend to invade NT or Tasmania? We also purchased some junk veteran planes from the Vietnam war. Just wondering what is more expensive: a pen pusher or a useless tank?
    But I also understand that there is the whole army of non-combat personnel we can easily do without. The problem is where to find them alternative jobs. In banking? Mining? Sports committees? Any suggestions?

  6. Yes, I remember Brendan Nelson defending the purchase of “useless” very costly machinery some time back – planes or helicopters, I think.

    I think it is important to remember that our country is an island completely surrounded by water, and is regarded by most of the world as a place in possession of the “Golden Orange”.

    As such, we are a potential target for any nation desiring to part us from it – especially those that have also been grossly overcrowded for “eons”.

    I think we must continue to watch our backs with India, Indonesia and a third country – which might be Japan.

    The Defence budget needs to increase each year due to inflationary pressures. The prices of equipment and cost of wages don’t go down. We are currently also at war.

    Last year, high school students were offered $55,000 per year to join the Navy.

    The government can’t recruit anybody because we don’t want our kids to die in Iraq, so they have to offer more money as an incentive.

    I think the incentive to die remains very low.

  7. Zen raises a very good point about the military hardware we have been buying, and that much of it seems expensive, useless or inappropriate. Perhaps there needs to be more openness into the decision making processes.

    Lorikeet – Andrew’s post indicates that the govt intends to continue to increase the Defence budget in real terms – which is beyond inflation, so that argument isn’t valid.

    I think most countries to our north seem happy to buy what we’re selling, with uranium being the only sticking point (which is less sticky than it was). And our government is happy to continue to accept immigrants. Frankly I find it hard to see any significant military action in our region soon, with most of our work being peacekeeping and reconstruction, which is a noble and appropriate role.

  8. Andrew Bartlwtt:

    Thanks for your insights on spin, deception and paper-shuffling in Defence spending.

    Without wishing to encourage all the wild conspiracy theorists out there …. there has been such a consistent pattern of stupid and completely inappropriate Defence purchases over many years that I find it exceedingly difficult to exclude out-and-out CORRUPTION from the list causes of such dangerous and foolish Defence purchases.

    No. I do not think bags of hard cold cash have changed hands. However, flattery, offers of directorships and professorships, something extra-special for the spouse and kids, a chance to look important among one’s peers – these are among the things that can swing a deal as much as money alone.

    Of course I am implying probable dishonesty and dishonour among some of those responsible for defending us. That’s why I said so.

    Until I see absolutely rock-solid evidence that all the incredibly idiotic Defence policies and purchases could not possibly had corruption as one of the causes, I have no alternative but to think of corruption whenever something really dodgy happens in Defence.

    Not nice, No it’s not. But having one’s own country annihilated or subjugated because of the incompetence and dishonesty of a few officials is not nice either.

  9. Muzz:

    The cost of war is high – both in the loss of human lives, and money.

    Without an army, we are sitting ducks.

    Just because we are led to believe that things are hunky dory, doesn’t mean that they are.

    I think there were good reasons for John Howard to have to keep crawling after Indonesia.

  10. Lorikeet[5];
    You have good reason to be concerned about our security systems being rendered useless. At the rate things are going, you’ll soon have to get your change-of-address forms from one of a dozen foreign embassies rather than from Australia Post. Don’t know about you but I would feel a lot safer if I knew “The Chaser” team or the local basketballers were looking after our security systems than some naive bureaucrats intent on saving”[??] money. Perhaps such woolly-headed bureaucrats might be better employed by issuing them with solid old-fashioned TS boots and sending them off to do a bit of percussive landmine clearance.

    …. and on [7]:
    Young people have always taken appalling risks [as, for instance, road accident statistics show].

    It’s not fear of death in Iraq or Afghanistan or elsewhere that is keeping so many young people out of the A.D.F. – it’s fear of the five “D”s – disgrace, disablement, disease, distain and disadvantage. Risk your life serving your country and you are guaranteed to get at least 3 of the 5 and maybe, if you have tried your best, you’ll get all five as your reward.

    Sadly, the A.D.F. has just about the worst “after sales service” reputation of any organization in Australia and because of that, their operating costs are a long way above what they could and should be. You don’t have to be a Rhodes Scholar to see why cash incentives to join the A.D.F. are such a failure nor why the silly – and horribly expensive – recruiting campaigns chase away far more than they attract.

  11. Graham Bell:

    I have made inquiries and it seems that some white collar Defence personnel are having their work outsourced from Brisbane to Canberra, with concurrent redundancies occurring.

    My ex-husband is keeping his job. They would stupid to get rid of a person with his extensive list of interactive qualifications and talents.

    On the national security front, I have heard of NO imminent dismissals. My son is being sent on more conferences and training courses in the coming months. Downsizing security would be an act of gross stupidity.

    When I applied for a job with the Commonwealth Government in 1985, other people recommended that I put Defence and Aviation on my list of exclusions.

    Defence has a reputation for employing uniformed “A words” among the white collar workers.

    Yes, you’re right about “the 5 Ds”, but my mother gets a DVA widow’s pension which is certainly not to be sneezed at.

  12. Lorikeet [12]:

    a. Downsizing security in a time of heightened risk is indeed stupidity.

    b. Yes. Although the DVA widow’s pension and the DSS civilian widow’s pension have the same basic cash value …. the few add-ons might be handy at times and, of course, the acknowledgment of your father’s service to his country is priceless.

    But what about the aggressive deprivation of war and peacekeeping veterans of their entitlements? What about neglect to have civilian recognition for skills and experience gained during military service – other than for a lucky few in highly specialized occupations such as air crew? What about the failure – on BOTH sides of politics – to add “military service” to the list of unlawful grounds for adverse discrimination? What about the dumping of injured and ill ex-service personnel onto inadequate pensions rather than rehabilitating them so that they can take as active a part in life as possible?

    “Saving revenue”? Yeah. Right. Of course. How could anyone doubt it? The results speak for themselves, don’t they”?

    Why would many sensible young people want to join the ADF when they can see, among their own relatives and neighbours, exactly what happens to you when you leave the ADF? Direct personal observation and word-of-mouth beats glossy advertising campaigns every time.

  13. So the entire integrity of the nation’s security systems is dependnet upon one individual working in Canberra…At least he’s related to lorikket, thast a relief

  14. Andrew Bartlett:

    A few suggestions on how to get defence that will actually protect us at a far lower cost:

    1..Let’s stop throwing good money after bad on gee-whiz war-toys with a very short combat life and that might be delivered only when the signs of the zodiac are propitious. Just pay the Yanks the $400Million penalties for breach-of-contract and get rid of them. In the long run, that would be far less expensive and far less perilous than continuing this manifest folly.

    There is now the additional danger that, if economic or social turmoil breaks out inside the U.S., we will have “all our eggs in the one basket”.

    2.. Then, instead of being repeat suckers for the suppliers of dud goods, let’s get out into the world market and buy exactly what we need at the fairest price and with the swiftest delivery time.

    If that means we buy refurbished second-hand equipment at dirt-cheap prices from Belarus – fine!!

    If that also means buying robust and reliable stuff at decent prices from smaller American companies – fine!!

    Ignore the whinging about the complexity, unreliability and lack of commonality of equipment procured on the open market. Why would that be worse than what we have now?

    Such independence – and consequent savings – cannot come until there are laws in place making it a felony to write overly restrictive defence procurement specifications that allow only the usual culprits to be considered.

    3..Australia can make a lot of its own defence equipment right here in Australia. We did it before, we can do it again.

    For instance, we have a wealth of experience with mining equipment; experience that can be rapidly utilized for building effective [and recyclable!] substitutes for old-fashioned, inefficient, very limited, horribly-expensive “tanks”.

    By all means, let’s have Defence cuts …. but make them cuts in stupidity, cuts in squandering, cuts in shonkiness…. not cuts in staff as a substitute for effective planning.

  15. Graham Bell:

    Yes you make some good points in relation to rehab, people who have difficulty transferring defence training into civilian jobs, and wastage of funds.

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