Australian Naval Procurement Cycles: Lessons for Other Small Countries
Abstract
Defence procurement agencies in smaller countries face a difficult challenge when seeking to acquire new weapons systems that are either intrinsically complex or idiosyncratically tailored to local needs. If they seek to rely on production in-country, they must draw on domestic infrastructure limited in its technological breadth and depth for efficiently producing a wide range of military products likely to be internationally uncompetitive. If they "leave it to the market" and award contracts on based competition and set up arms-length relationships to pursue compliance, they may find themselves hostage to suppliers that cannot be replaced once the contract is under way. If they seek supplies from government-owned arsenals and shipyards, they may find it difficult to resist political pressures. And, if they look to overseas suppliers, they may lack the market power to negotiate favourable terms. These challenges, and the related issue of whether to use defence acquisitions to support domestic industry, are discussed in the context of procuring naval vessels and support services in Australia. The country has long had domestic warship building and maintenance capabilities. Naval vessels are the only major platforms built in Australia, and firms that build them are the highest profile element of defence industry. We consider Australia's three post-WWII shipbuilding cycles to illustrate how successive federal governments have grappled with these procurement challenges. We draw lessons from the first two cycles to explain why and how the government has been driven to increase its responsibility for managing key shipbuilding projects. Many lessons are relevant to other defence industry sectors. They illustrate a range of problems typical of many Defence-Industry relationships in small countries.
Document Details
- Document Type
- Technical Report
- Publication Date
- Apr 23, 2008
- Accession Number
- ADA493940
Entities
People
- Peter Hall
- Robert Wylie
Organizations
- Australian Defence Force Academy