{"id":30594,"date":"2017-02-20T12:30:10","date_gmt":"2017-02-20T01:30:10","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=30594"},"modified":"2017-02-20T10:03:40","modified_gmt":"2017-02-19T23:03:40","slug":"defence-isnt-telling-us","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/defence-isnt-telling-us\/","title":{"rendered":"What Defence isn\u2019t telling us"},"content":{"rendered":"

\"Image<\/p>\n

I was invited to appear last week at a hearing of the Joint Standing Committee on Foreign Affairs, Defence and Trade Committee <\/em>Review of the Department of Defence Annual Report 2015\u201316<\/a>. The review is an annual exercise when the <\/em>Defence Annual Report<\/a> is tabled, but I took the opportunity to make some comments about Defence\u2019s reporting more generally. Mark Thomson also gave evidence, and a transcript of the entire session will appear in the Hansard in due course. Here\u2019s my introductory statement.<\/em><\/p>\n

Thank you for the opportunity to make some comments this morning. As you will have seen in my short written submission, I have some concerns about the quality and quantity of information in not just the annual report, but in Defence’s reporting more broadly. The lack of transparency in Defence public reporting is lamentable.<\/p>\n

Let me begin with an illustrative example. I\u2019ve been following and commenting on the progress of Australia\u2019s acquisition of the F-35 Joint Strike Fighter for 11 years now. Working from public information I can\u2019t tell you some of the most basic facts concerning our purchase, such as the phasing of purchases, the expected cost of each batch of aircraft, the cost of initial spares and auxiliary equipment. Instead, I can tell you the total number of aircraft we expect to purchase and an indicative in-service date. The planned total cost is a single imprecise aggregated figure. As a result, I won\u2019t be able to tell you whether our acquisition processes are on track, or if the planned costs are being realised in practice.<\/p>\n

However, if you were to ask me for details regarding the corresponding plans for the US Air Force, I would turn to the extensive budget materials provided through the Pentagon\u2019s Comptroller. Looking at the Air Force Justification Book Volume 1 of 2, Aircraft Procurement, I could tell you, for example, that they expect to acquire 48 aircraft in each of 2019 and 2020, rising to 60 in 2021. The flyaway unit cost in each of those years is expected to be $102.4 million, $99.3 million and $94.5 million respectively. I can also tell you the weapon system cost (which lets us simply work out the cost of initial spares and support equipment), the phasing of spending on long lead items, the cost of engines and other major equipment. Incidentally, the volume with those figures is one of 34 volumes of USAF budget documentation alone.<\/p>\n

That\u2019s extremely useful information, and it allows for the compilation of time series of data which makes a rolling assessment of the program\u2019s status relatively easy to do. In the period 2006\u20132011 it was clear that costs were rising steeply and production was being deferred. It wasn\u2019t a pretty picture, but it was an accurate one. It was also at odds with the upbeat assessments coming out of the project office at the time. That\u2019s why data is critical if officials are to be held to account. I\u2019m happy to say that the data sets from 2012 tell a very different story of a program in which costs are now steadily tracking downwards and production is ramping up. I\u2019ll table a copy of my most recent summary analysis of the F-35 program<\/a>, so you can get a feeling for what I mean.<\/p>\n

And as a technical aside, the costs given in the US budget papers are in out-turned dollars, but I can convert them to same year dollars by referring to the deflators for procurement in one of hundreds of tables of financial assumptions in the \u2018Green Book\u2019 that accompanies the budget papers each year. Perhaps Mark will like to say more about the usefulness or otherwise of out-turned dollars with no indication of the underlying assumptions\u2014the \u2018greater than $50 billion\u2019 figure quoted for Australia\u2019s future submarine is an example of how misleading and unhelpful that practice can be.<\/p>\n

Let\u2019s compare and contrast the American F-35 data with the corresponding information available regarding our most expensive program in the form of the future submarine. We have a single cost bound\u2014not a number\u2014and an indicative delivery timeframe that spans 20 years from \u2018around 2030\u2019 to \u2018around 2050\u2019.<\/p>\n

One of the reasons that Defence often invokes to explain the paucity of information it releases is the need to protect the government\u2019s negotiating position during contract negotiation. As a taxpayer I have some sympathy for that argument, and that would be reason enough to not disclose the Department\u2019s thinking during the Competitive Evaluation Process. But we now have a chosen designer, and Defence should soon have a timetable and milestones for the detailed design process. It\u2019s hard to see the justification for keeping those numbers and dates secret\u2014if it\u2019s good enough for the Pentagon\u2019s jet fighters, nuclear submarines and aircraft carriers, it ought to be good enough for us.<\/p>\n

I suppose I should pay some service to the subject at hand today and comment on the Defence Annual Report. Let me make one request\u2014that the tables of costs of supporting the various capabilities which was last seen in the 2006\u201307 annual report be reinstated. It was extremely useful for calculating through life cost estimates and for monitoring the resources being consumed by various force elements. Among many other things, it enabled me to spot and write about the under-resourcing of Collins submarine sustainment a couple of years before the nadir of submarine availability that embarrassed Defence and successive governments, and which made the Coles review necessary. Avoiding embarrassment (or, more accurately, deferring it until the Audit Office gets at it) seems to be a key performance indicator in formulating defence reporting.<\/p>\n

It makes me think that too often the lack of detailed defence information in the public domain isn\u2019t to protect official secrets, but to protect officials\u2019 secrets.<\/p>\n

I look forward to your questions and discussion.<\/p>\n","protected":false},"excerpt":{"rendered":"

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