Senator Nick Xenophon Attacks Secrecy Of $500 Million Australian Submarine Contract

Paul Starick, The Advertiser
12 December 2016

Excessive secrecy imposed on the first contract in Adelaide’s $50 billion submarine project will prevent measurement of job and business benefits, says influential Senator Nick Xenophon.
Threatening court action over a federal blackout of key contract sections, Senator Xenophon said this secrecy would prevent the public understanding what they were paying for and when to expect the finished product.
A redacted version of the $500 million submarine design and mobilisation contract, signed on September 30, has been tabled in Federal Parliament by Defence Minister Marise Payne.
“It’s simply not good enough that the government is claiming secrecy on material that’s clearly in the public interest to disclose,” Senator Xenophon told The Advertiser.
“If we don’t know this information, we won’t be able to know how many jobs will be created.”
Senator Xenophon is vowing to take court action, if necessary, to force release of more details on contract measures including top-level price, schedule details, intellectual property and Australian industry involvement.
Australian Strategic Policy Institute defence and strategy program director Andrew Davies said defence acquisition was lamentably opaque and it was no surprise even high-level elements of the contract were kept secret.
“As it is, it’s very hard to hold governments or officials to account due to the paucity of information we have. The US does it so much better,” Dr Davies said.
An agreement to improve sharing of classified information between Australia and France was signed on Friday, aiming to support the future submarine program delivery and other national security matters.
It includes mutual recognition of personnel and facility security clearances — essential when people from both countries will be operating at top-secret naval shipyards.
Defence Minister Marise Payne, in a letter attached to the tabled contract, says some aspects would be inappropriate to disclose publicly because they might disadvantage submarine designer and builder DCNS and help its business competitors.
“Given the role of DCNS in delivering French national submarine programs, such disclosure could reasonably be expected to also damage international relations with France,” Senator Payne says.
Some fee and pricing structures contain information that reveals DCNS’s cost structure and profit rates, she says.
Meanwhile, the Adelaide-built air warfare destroyers will be maintained by BAE Systems Australia under a five-year, $70 million contract announced by Defence Industry Minister Christopher Pyne. This will provide about 50 fulltime jobs in Sydney.