The new Defence Strategic Review (DSR) is at its harshest when it talks about Defence procurement, or lack thereof.
One of the big issues is reluctance to take reasonable risk, maybe a legacy of a succession of lurid headlines about acquisition stuff-ups and the ensuing grilling of officials in Senate estimates hearings.
Defence Minister Richard Marles said procurement needed to be streamlined and nimbler to deliver capability faster.
“It means we have got to have a greater appetite for risk,” he told reporters.
Defence’s current approach to capability acquisition is not suitable given our strategic circumstance, the DSR says.
“Once projects have entered the IIP (Integrated Investment Program), capability managers have too much latitude to make design changes, tinker with capability outcomes and indulge in the quest for perfectionism,” it says.
The result is big delays or capabilities not achieved at all. The government agrees, declaring the capability acquisition process is not fit for purpose.
“Defence will reform the capability acquisition process to achieve more timely and relevant capability outcomes in response to our strategic circumstances, with an emphasis on minimum viable capability,” it said in its response to the DSR.
Of six recommendations, the government has agreed to four and agreed-in-principle to the other two.
One (agreed) is to balance Australian industry capability against timely acquisition, which could indicate more overseas acquisition, likely through US FMS.
Another (agreed) is to streamline the acquisition process for projects deemed strategically urgent or of low complexity.
So substantial reforms are ahead, which will require work, which is under way.
The government has foreshadowed potential amendments to the budget process operational rules for the 2024-25 budget. Risk-based behaviours will be developed and released in 2024 National Defence Strategy.