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Program 1.11 - Capability Development

Capability Development Group develops and manages the Government's plans for future Defence capability as outlined in the Defence Capability Plan. The plan lists the Unapproved Major Capital Investment Program projects planned for government consideration (first and/or second pass) covering a range of significant future force capabilities, including maritime, land and air platforms and weapons systems, communications and intelligence systems, and enablers of Network Centric Warfare. The group maintains close relationships with a range of stakeholders including capability managers, the Defence Materiel Organisation and industry.

The classified Defence Capability Plan is reviewed and updated on a regular basis to take account of factors that emerge as the capability development process progresses, including changing strategic priorities and economic circumstances; the maturity of projects and the evolution of technology in options under consideration; and operational experience.

The 2012 public Defence Capability Plan was released by the Government on 10 July 2012 and contained those priority projects planned for either first or second pass approval over the four-year forward estimates period. It contained 111 projects, or phases of projects, worth approximately $153b in capital costs. These projects will deliver key capabilities for the ADF. The Defence Capability Guide was released on 5 October 2012. This document provides general guidance for industry on projects for the six- year period following the four-year forward estimates period of the public Defence Capability Plan.

Table 3.30 Program 1.11 deliverables

Table 3.30 Program 1.11 deliverables
Deliverable Status
Provision of timely, accurate and high-quality advice on all aspects of capability development to the Secretary, CDF and the Government Substantially met
Development of an affordable and executable Defence Capability Plan Substantially met
Publication of the public version of the Defence Capability Plan Substantially met
Management of the Key Defence Assets Register, Unapproved Major Capital Investment Program and Net Personnel Operating Cost (also known as the Defence Capability Plan) Substantially met
Development of Defence capability investment proposals for consideration by the Government Substantially met
Provision of independent analysis and contestability of capability proposals Met
Update and publication of the Defence Capability Development Manual Substantially met
Enhance the effectiveness of the capability development process through the implementation of Capability Development Improvement Program initiatives Substantially met
Under the Rapid Prototyping Development and Evaluation program, work collaboratively with Australia's defence industry to develop innovative solutions to complex issues affecting capability and current operations Substantially met
Deliver independent Test and Evaluation support, trials and demonstrations to Defence throughout the capability system's life cycle Substantially met

Table W3.31: Program 1.11 key performance indicators

Table W3.31: Program 1.11 key performance indicators
Key performance indicator Status Comment
Submit capability investment proposals within agreed resources and to an agreed standard:
  • implement Capability Development Improvement Program initiatives to improve the timeliness and quality of capability submissions, and reflect these improvements in an update to the Defence Capability Development Manual
  • introduce Portfolio Management arrangements that improve coordination and performance of capability development activities
  • introduce corporate information management systems that support end-to-end visibility, planning, management and reporting of capability development
Substantially met A number of capability development improvement program initiatives, such as improving committee effectiveness and an updated capability development project document suite, have improved the timeliness and quality of submissions presented to Government. The Defence Capability Development Manual has been updated to reflect these improvements.The Capability Development Group portfolio, program and project management office functions have been established and embedded into various group organisational elements under the group's 'form follows function' organisational change and business process reform initiatives implemented during 2012. Accordingly, group arrangements now reflect implementation of: the revised Integrated Capability Development Branch within Capability Systems Division; Strategic Analysis Branch within Capability Investment and Resources Division; the Capability Development Improvement Program and Knowledge Management and Skilling directorates within Group Support; and the Defence Capability Plan Portfolio Management Office within Capability and Plans Branch.The introduction of the capability development management and reporting tool has provided better visibility to all Defence staff on a number of important project information requirements. The tool is developing as a key management information source for Defence Capability Plan projects across the capability development community.
Contestable advice that delivers:
  • a greater level of confidence that individual proposals have realistic schedule and costs projections, comprehensive risk assessments and mitigation
  • proposals that are coherent, compelling and consistent with strategic guidance and affordable within the Defence Capability Plan
Met Capability Investment and Resources Division plays a central role in the departmental force development process by providing independent analysis (i.e. contestable advice) of major force development proposals and by managing the Defence Capability Plan. The First Assistant Secretary, Capability Investment and Resources is a permanently invited official at the Defence Capability and Investment Committee (chaired by the Secretary, with the CDF as a member) and assists in the finalisation of the Defence Capability and Investment Committee minutes.

Capability Development Group achievements

The group, in conjunction with industry, is responsible for the operation of the Rapid Prototyping, Development and Evaluation Program, which encourages innovation in future Defence capabilities. The program has undertaken ten quick looks and seven tasks during 2012-13, which resulted in Australian defence industry providing innovative and collaborative solutions to complex capability development issues within the Defence Capability Plan. All pre-first pass projects are considered for a quick look at the Project Initiation and Review Board.

During 2012-13, the group achieved 27 approvals worth over $4b. The 27 approvals comprised six first pass; 16 second pass; and five other types of approvals, including Capability and Technology Demonstrator Program round 17.

Significant first pass approvals included SEA 1000 phase 1 and 2-future submarine design and construction (submarine propulsion energy, support and integration facility), and JP 2068 phase 2B.2-computer network defence. Significant second pass approvals included AIR 5349 phase 3-EA-18G Growler airborne electronic attack capability (Growler capability and 12 additional aircraft); JP 2047 phase 3-terrestrial communications; and SEA 1448 phase 4A-capability assurance program. In addition, the Government provided guidance on the progression of options for SEA 1000 phase 1 and 2-future submarine.

To build on efficiencies in delivering capability proposals, the group has established a framework for continuous improvement to its processes-the Capability Development Improvement Program, which has contributed to improved capability development performance.

The Key Defence Assets Register is an important Defence asset management tool and a source of trusted authoritative data to support capability planning and strategic decision making. In February 2013, Defence completed a comprehensive review of the register, updating the data recorded in the register in the process. The next register update is scheduled for August 2013. In February 2013, Defence also began transitioning the register's standard operating procedures into the Defence Capability Development Manual being developed under Defence's policy framework. Defence plans to complete this transition in 2013-14.

A record 19 major trials were undertaken in this period against a historical average of 11. The trials supported project considerations at second pass with preview test and evaluation, and operational test and evaluation for acceptance into operational service considerations. Following the Senate Inquiry into Defence Procurement, a major review and centralisation of Defence test and evaluation policy has begun under capability development improvement program initiative 11.