View From Canberra: Fuss over not much | ADM Apr 2010

A Special Correspondent | Canberra

To be sure there were some interesting items which need further explanation.

That includes a $30,000 account for "stuff" plus some phantom accounts of which the beneficiary companies appear to have no record.

But for a very large amount of media resources devoted to a very detailed and comprehensive investigation of defence accounts, the end result all seemed to fall a bit flat.

There appear to be a number of reasons.

First and foremost, anyone with any detailed knowledge of defence and its cumbersome bureaucracy has heard all this before.

About everyone knows defence is a vast inefficient enterprise.

Much of what was reported in shocked tones turned out to be wholly explicable.

Hiring of a Lear jet conjures images of a top brass foregoing the inconvenience of commercial air travel.

Defence actually charters Lear jets to tow gunnery targets, a cheaper option than keeping its own aircraft for this task.

Then there's the $1.7 million bill for hotel accommodation for trainee recruits.

Once upon a time they would have been put up in barracks accommodation on various bases but that's now mostly been done away with to save money.

How about $21,000 spent on Weight Watchers?

It doesn't seem an unreasonable investment considering the cost of discharging unfit personnel and then finding replacements.

The SMH doesn't have a great deal of form in reporting defence matters.

Typically when one media organisation comes up with a particular exclusive report, other media organisations will follow.

The Australian newspaper, with a stronger record of reporting defence matters, demonstrated its utter contempt for the SMH's ‘scoop' by reporting not one word of it.

Even the opposition wasn't rushing out to belabour the government for one more big failing in public administration.

The opposition defence spokesman David Johnson issued one press statement, as did his junior Bob Baldwin.

However, it's a fair bet this has given Senator Johnson some useful information come the next round of estimates hearings.

Defence Minister John Faulkner made the appropriate noises but that's about it.

One senior government official noted that when you go through thousands of defence accounts, you are going to come up with some real humdingers.

Having spent much of his 11 years in opposition going through defence accounts to fuel his estimates committee inquisitions, Senator Faulkner can't have been all that surprised at what the SMH came up with.

All the same, this raised some important points which seemed to come as shocking revelations to the SMH's inner urban readership.

Defence does need to do a whole lot better.

A decade of government generosity after the lean times of the 1990s has created bad habits and a top heavy bureaucracy, inefficient processes and a tacit expectation that the government will always drag out the cheque book if things get too tough.

Nothing about defence is cheap and it's getting more expensive by the week.

That covers everything from new equipment to personnel, support and especially operations in faraway places.

Better on the field
It's been repeatedly remarked by a succession of defence secretaries that the Australian Defence organisation does a whole lot better on the battlefield than it does in its administrative processes.

And for that very reason, the government last year mandated the Defence Strategic Reform Program to slice $20 billion from costs over the next decade.

That's regarded as entirely achievable through a wide range of administrative efficiencies, most so mind-numbingly tedious that the original launch of this scheme shortly after the White Paper release attracted almost no media attention.

Perhaps that was also because improving defence efficiency has been a near constant process for the last two decades with a succession of reviews and ensuing reform plans, some good some otherwise.

For example, the Force Structure Review of 1991 launched the process of privatisation of non-core defence functions.

This produced much shrieking at the time but is now wholly accepted.

It also launched the process of creating a far greater defence presence in the north. But coming at the end of the end of the Cold War, it proposed a smaller defence force, creating a trajectory that defence is only now fully overcoming.

Big changes
Of all the defence reforms, the first and perhaps the hardest and most courageous step involved the corporatisation of the Office of Defence Production (ODP) back in May 1989.

This created Australian Defence Industries (ADI), now part of the French Thales group following full privatisation in 2006.

ODP arose out of two world wars and left the Australian defence organisation as the proud owner of its own shipyards and aircraft, weapons and munitions factories, along with a 10,000-strong heavily unionised workforce all on the public payroll.

Throughout the 1980s there was much deep though on how this could be made more efficient and pay its way but the end conclusion was that this just wasn't sustainable.

The final result was the formation of ADI, with ASTA holding the former Government Aircraft Factory, with vast redundancies.

This was a very big step for a Commonwealth public service unused to shedding more than handful of people at a time and a Labor government, hitherto the champion of the working class.

Thales is now one of Australia's biggest defence contractors but there's still some debate about whether some long term contracts, such as for ammunition supply, represent best value for money.

The government has ticked domestic munitions production as a Priority Industry Capability but it's argued ammunition, along with much else, could surely be sourced more cheaply overseas.

That's a perfectly good plan, right up to the moment when the overseas supplier, most likely the good old US, decides it needs all of its production to meet its own military and domestic needs.

And that's been the situation for the last couple of years, with the US engaging in successive conflicts in Iraq and Afghanistan and the US citizenry stockpiling arms and ammo like fury out of concern that the Obama administration will restrict their right to keep and bear arms.

Well, there's always the Chinese.