Reopen tender for navy supply ships to include Australian firms, says Senate

A Senate Inquiry has today recommended that the tender process for two Royal Australian Navy supply ships be reopened to include Australian companies.

The Coalition excluded Australian companies from tendering to build these ships, with the work instead sent offshore to Spain or South Korea.

Defence Minister David Johnston claimed that Australian ship builders could not build the vessels.

Construction of these vessels is simply beyond Australian industry.

Senator David Johnston, 16 June 2014

In submissions to the Future of Australian Naval Shipbuilding Inquiry, this claim was shown to be false.

Australian shipbuilding companies, the Australian Manufacturing Workers Union, the South Australian Government and industry peak bodies, all gave evidence saying that Australian shipyards can build these ships.

The committee has recommended that:

  • the tender process for the two replacement replenishment ships be reopened to include Australian companies;
  • the government undertakes open tender processes for any future naval acquisition.
  • the tender must make clear that a high value will be placed on Australian content in the project.

Shadow Industry Minister Senator Kim Carr said: “This decision will mean hundreds of Australian highly skilled ship building workers will lose their jobs, with the work sent overseas.

“Just like we’ve seen with its inaction and disregard for automotive manufacturing, the Abbott Government has no interest in standing up for Australian jobs.”

“The government’s reasoning behind its decision to offshore this acquisition has been blown out of the water,” Shadow Assistant Minister for Defence, David Feeney said.

“We have heard that Australian companies are willing and able to do this work here in Australia with Australian workers.”

“This is yet another example of the Coalition taking decisions that are aimed at killing off Australia’s strategically important shipbuilding industry.

“Given that we are a maritime nation dependent on secure sea lanes, with the essential need for a national ship building capacity, the Abbott government’s approach to this issue is putting our national security at risk in an uncertain world.”

The chair of the committee, NSW Senator Sam Dastyari, said: “The fairest way to determine which company is best placed to fulfil a contract is through a competitive tender.”

“By excluding Australian companies the coalition has denied Australia’s right to even compete. How can that be fair?”


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