Defence concedes typo
Defence has been criticised for mistakes in the documentation for Australia’s Future Submarine budget.
The Defence Department’s annual report released last week said the government approved a $4.9 billion injection for the project during the 2018-19 financial year, leaving the total budget to date at almost $6 billion.
Analysis of the figures has found that $1.3 billion of extra funding was due to a change in the project's “scope”, while another $3.7 billion was attributed to “real increases needed to fund underestimates or budget overruns”.
When asked by reporters, Defence said the latter figure was “described inaccurately”, as the money had already been provisioned to cover both future submarine design work, but also Adelaide shipyard equipment and workforce over the next few years.
The department issued a statement conceding the mistake in its annual report.
“Defence has identified unclear labels on the presentation of the supplementary online material … as being expenditure in a single financial year,” the statement read.
“The Department will release an updated table once finalised.
“To be clear, there have been no under-estimates or budget overruns for the Future Submarine Program.
“These programs will be funded through a series of progressive Government approvals — all which are provisioned within the Defence Integrated Investment Program.”
Marcus Hellyer from the Australian Strategic Policy Institute - a former Defence Department official - says the submarine program could still prove to be more expensive than originally anticipated.
“These figures confirm that the government has now approved nearly $6 billion in funding for the future submarine program, and that only gets it to the start of construction,” Dr Hellyer told the ABC.
“Defence will spend around $750 million on the program this year and that's likely to go well beyond $1 billion a year even before construction starts in 2022-23.
“That has to be putting a lot of pressure on Defence's ability to fund other priorities.”
The Defence Department says expenditure on Future Submarine Design and Construction was $834.6 million as at 30 June, including “the cost of design work, the science and technology program, and operational costs”.
Opposition assistant defence spokesperson Pat Conroy questioned the handling of the program.
“The fact that Defence can't even manage to accurately report on a $3.7 billion increase in the project's budget is of real concern, especially given the fact that the Future Submarine project is already running 10 years late,” he said.
“The unjustified secrecy surrounding this project is amply demonstrated by a quadrupling of the project budget first being disclosed through an appendix in an annual report.
“It is no wonder that there is little public confidence in the Government's handling of what is the largest and most complex project ever run in Australia.”