Review by the Secretary and the Chief of the Defence Force
Force Capability
To ensure the future effectiveness of the ADF, Defence continued to work towards achieving the capability goals outlined in the Defence White Paper and adjusted in the Defence Update. Significant milestones were achieved in the early stages of major capital acquisition projects in the Defence Capability Plan, such as air-to-air refuelling and helicopter rationalisation. Other major projects, including airborne early warning and control aircraft and armed reconnaissance helicopters, remain on schedule and within budget.
In October 2002, Australia formally joined the system development and demonstration phase of the Joint Strike Fighter program. This represents a new approach to international participation in combat aircraft programs. Participating in this phase is a more forward-thinking approach, one that reflects closer partnering with industry and improved responsiveness in the Defence capability acquisition process. These kinds of innovative approaches are needed if the ADF is to remain at the forefront of developments in technology. Several industry opportunities have already been identified for the future and the Government is seeking to secure an Australia-based regional support capability for Joint Strike Fighter aircraft.
Defence's investment program is on track to achieve the White Paper capability goals, with some 85 new projects having been approved since December 2000 with an all-up cost of around $16b. There have been some delays in projects as the Government and Defence have worked to ensure that projects are subject to greater scrutiny in order to achieve better outcomes for the ADF.
Following on from the Defence Update, a full review of Australia's defence capabilities was commenced to take account of the changes to our strategic and security environment since the publication of the White Paper. This review will focus on the development of a more flexible and mobile force, with sufficient levels of readiness, sustainability and interoperability, to perform the increased range of tasks the ADF is likely to face in Australia's current strategic environment. The Government has already expanded the Special Forces to meet the most immediate security changes, but the capability review will identify what further rebalancing of capability and investment priorities might be required to meet the needs of our changed circumstances.
[ Read more: Initiatives to Improve Capability | Major Capital Equipment ]
During the year, the Senate Foreign Affairs, Defence and Trade References Committee undertook an inquiry into Materiel Acquisition and Management in Defence. Overall, its report was positive about the creation of the Defence Materiel Organisation and the implementation of the materiel reform agenda. The committee expressed confidence that the organisational, structural and process reforms already implemented by the Defence Materiel Organisation were providing the disciplined basis necessary to deliver projects on time, within budget and that meet operational requirements.
A separate review of Defence procurement was initiated by the Government to identify further improvements in Defence project management. The review team, led by Mr Malcolm Kinnaird, was to report to the Government early in 2003-04(1).
[ Read more: Defence Materiel Reform ]
Defence continued to work during the year to shed unwanted overheads arising from property ownership. Defence will continue to own properties that contribute directly to military capability and special purposes. Other properties that become surplus to requirements will be divested in accordance with Australian Government property disposals policy. In 2002-03, Defence sold properties to the value of $616m. The Government decided not to proceed with the sale and lease-back of the Russell Offices in Canberra.
Maintaining ADF capability relies on our ability to attract, train and retain the right people. In 2000, the Australian National Audit Office (ANAO) conducted a performance audit on the retention of military personnel. A follow-up audit, tabled in March 2003, concluded that Defence had made progress in implementing the original audit recommendations and commended Defence for undertaking evaluation of measures designed to retain personnel. Recent initiatives include the identification and management of critical trades and key service separation points for the ADF and programs focused on ADF members' families, including Defence employer-sponsored child care and spouse employment, improved choice of accommodation for members without dependants and enhancement of housing standards for members with dependants.
[ Read more: Auditor-General's Reports| People: Priorities ]