SENATOR THE HON PENNY WONG

LEADER OF THE OPPOSITION IN THE SENATE

SHADOW MINISTER FOR TRADE AND INVESTMENT

SENATOR FOR SOUTH AUSTRALIA

TRANSCRIPT

21 November 2014

891 ABC ADELAIDE DRIVE WITH MICHAEL SMYTH

TOPIC: FUTURE SUBMARINES

E&OE - PROOF ONLY

SMYTH: I was able to speak to Labor Senator Penny Wong just before coming to air. She was on that committee, taking evidence from Mr Whiley.

WONG: Today before the Senate, the CEO of the Australian Submarine Corporation confirmed a cost range for building submarines here in Australia. And what he said is that it would cost between $18 [billion] and $24 billion. Now that is much less than the Government has been suggesting it would cost us. Remember, as part of its softening up to break another promise – and that is the promise to build submarines here in Adelaide – the Government has been suggesting figures up to $80 billion. Well, right from the horse’s mouth today you have the ASC saying ‘we could do it between $18 and $24 billion.’

SMYTH: How could the figures be so wildly different?

WONG: A very interesting moment today was when I asked the CEO, who has worked on the Collins submarines for some 25 years – so, this is an engineer with deep experience in both construction and maintenance – when I asked him ‘where do you think the Government got the $80 billion figure from’, he said that he had no idea. He couldn’t work out how they could have come to such a figure.

And really what this shows yet again is that these sorts of figures are bandied around by the Government, because they’re trying to walk away from the very clear commitment they gave South Australians: “We will build twelve submarines here in Adelaide.”

SMYTH: Given that no final decision has been made in terms of the add-ons that these subs might have, in terms of the exact specifications, could this figure given today still be well south of any sort of final costing?

WONG: It’s true the Government hasn’t made public the specifications for the submarines, it’s concentrated on denigrating the Australian workforce and the ASC, and on justifying  why it had to walk away from its promises rather than telling people what its needs really are. But I think what you see is such an order of magnitude difference between the estimates of what it would really cost from the horse’s mouth – from the Australian Submarine Corporation – and the sorts of figures the Government has been putting around.

SMYTH: The Defence Minister David Johnston has just released a statement saying that “the Government won’t speculate on the total cost of any Future Submarine program, because no decision has been made,” but then he goes on to say that “the Labor Party has got no credibility when it comes to submarines.”

WONG: This is a bloke who, over a year and a half ago, stood up in Adelaide and said “we will build twelve submarines here in Adelaide.” He’s hardly someone to be talking about credibility.

SMYTH: Tell us about how Mr Whiley was gagged at this Senate Estimates committee today.

WONG: When I started to ask more detailed questions about the basis of this assessment, really to deal with the issue you raised. You know, ‘tell us about how you’ve constructed these figures, how you’ve come to the figures’, the Minister intervened and refused to allow the official to answer, and took the questions on notice. It really shows this Government only wants you to know what suits it, and not the truth.

I think Australians, and South Australians particularly, are entitled to know what the ASC could do, and whether it could deliver the twelve submarines. The evidence today, the evidence to the Senate Inquiry into submarines really demonstrates two things. We can, and should, build these submarines in Australia; it will be more cost effective if we do that. And second, that in terms of our capability – that is, what the submarines can do – there’s no supposedly ‘off-the-shelf’ submarine that meets Australia’s strategic needs.

SMYTH: You’re listening to Drive on 891 ABC Adelaide, Labor Senator for South Australia Penny Wong is with us. How much do you know about this visit to Osborne this week by the Swedish and German submarine builders, and how they might be able to collaborate with ASC on the next generation of subs?

WONG: We had evidence before the Inquiry about three visits actually. There were two visits which had been arranged by ASC themselves. That was the German and Swedish shipbuilders, who visited – obviously exploring possibilities for collaboration with the ASC. And that was something that the ASC itself initiated.

Then there was also a politically-driven, high-level delegation from Japan that was arranged externally. Which suggests, obviously, that there was a bit of a political push behind getting the Japanese down to the ASC to have a look at the work that was done there. I think the problem here is, the Government says it’s worried about cost, but as everybody knows, one of the best ways to get the best cost outcome is to actually hold a competitive tender, rather than just pick someone. And I don’t know why it is that the Government is so keen to both break a promise, and to avoid any competition in this bid.

SMYTH: Penny Wong, thanks for your time on Drive, we appreciate it.

WONG: Good to speak with you.

ENDS