{"id":71568,"date":"2022-03-30T10:38:56","date_gmt":"2022-03-29T23:38:56","guid":{"rendered":"https:\/\/www.aspistrategist.ru\/?p=71568"},"modified":"2022-03-30T10:38:56","modified_gmt":"2022-03-29T23:38:56","slug":"defence-budget-shows-signs-of-a-different-approach-but-is-it-changing-fast-enough","status":"publish","type":"post","link":"https:\/\/www.aspistrategist.ru\/defence-budget-shows-signs-of-a-different-approach-but-is-it-changing-fast-enough\/","title":{"rendered":"Defence budget shows signs of a different approach, but is it changing fast enough?"},"content":{"rendered":"
<\/figure>\n

The 2022\u201323 defence budget is a conflicted program. In key ways it acknowledges and responds to a changing world, but in others it is a relic of an earlier time.<\/p>\n

Let\u2019s start with the funding line. At $48.6 billion between the Department of Defence and the Australian Signals Directorate, it\u2019s a substantial and growing sum. In nominal terms it\u2019s a healthy 7.4% increase on 2021\u201322. Despite high inflation, it\u2019s still a real increase of 3.8%. For those interested in spending as a percentage of GDP, it\u2019s 2.11% based on the government\u2019s GDP predictions. Of course, using GDP to measure defence spending is a crude tool; 2021\u201322\u2019s defence budget started off at 2.09% but is now a hair below 2.0% at 1.98% because GDP has recovered so strongly, not because the government didn\u2019t deliver its funding commitment.<\/p>\n

Indeed, we should note that as in the previous five years, the government has once again delivered the funding it committed to in the 2016 defence white paper. And there\u2019s the rub. That funding line was developed in 2015 before China\u2019s de facto annexation of the South China Sea, before its neighbours became aware of the implications of its campaign of coercion, and certainly before Vladimir Putin\u2019s invasion of Ukraine reminded us that war is still a thing.<\/p>\n

While the government showed commendable fortitude in maintaining its white paper funding commitment during the pandemic when its bottom line took a substantial hit, its own assessments have highlighted the growing uncertainty and risk in our strategic environment. Is it time to reconsider a funding model developed nearly seven years ago, particularly when that funding line continues through the forward estimates, at which point it will be based on assumptions more than 10 years old?<\/p>\n

Nevertheless, the government has shown that it recognises the changing nature of competition and conflict. It\u2019s pouring an additional $4.2 billion over the forward estimates and $9.9 billion over the coming decade into the Australian Signals Directorate to deliver greater offensive and defensive cyber capabilities. That will result in a doubling of ASD\u2019s funding in just a couple of years to more than $2.2 billion per year. Whether ASD can find double its current number of people is another matter. I\u2019m pretty sure that offensive cyber experts don\u2019t grow on trees, and a lot of those who are currently working in the field aren\u2019t the kind of people who are going to get a top-secret security clearance.<\/p>\n

But if the pudding is staying the same size while somebody is getting more of it, then somebody else has to get less. Over 85% of ASD\u2019s additional funding is coming out of the Department of Defence\u2019s funding. To be precise, it\u2019s coming out of Defence\u2019s capability acquisition program. There are reductions in that program of more than $1.5 billion per year over the next three years compared to the plan a year ago.<\/p>\n

Of course, concerns over Defence\u2019s ability to spend its acquisition budget probably played a role, since the department has come up around $1 billion short of its spending target in each of the past two years. But it seems clear that the government has prioritised the demands of the cyber domain over traditional equipment programs. What we can\u2019t see from the portfolio budget statements is whether it is adapting elsewhere\u2014by pursuing the small, the smart and the cheap rather than huge industrial-age projects, for example.<\/p>\n

Its megaprojects simply aren\u2019t delivering relevant capabilities in meaningful timeframes. The cancelled Attack-class submarine program will have spent $3 billion by the end of 2021\u201322. What\u2019s worse, Defence is still going to spend another $500 million on it in 2022\u201323, a year after the program was terminated. That\u2019s for a capability Prime Minister Scott Morrison admitted would be obsolete the day it would eventually have been launched sometime in the mid-2030s.<\/p>\n

Which other programs need to face this same truth? The war in Ukraine seems only to have solidified the supporters and opponents of Defence\u2019s planned investment of at least $30 billion on armoured vehicles in their positions. But even supporters of that spending can\u2019t be happy with the fact that by the end of 2022\u201323 we will have spent more than $2.3 billion on the Boxer combat reconnaissance vehicle to see only 25 (overseas-built) vehicles delivered five years after the project was approved.<\/p>\n

If these capabilities are so important, why are we happy to accept such woeful timelines? No announcement on the successful bidder for the $20-billion-plus infantry fighting vehicle program accompanied the budget, though it may yet happen during the election campaign. But will we be happy with a similar delivery schedule? One might say that the M113 armoured personnel carrier has been obsolete for three decades already, so where\u2019s the harm in waiting yet another decade for its replacement? Or one might also learn from the Ukrainians who went from easybeats to the toughest land force in Europe in eight years and ask how they turned things around without waiting for projects that take decades to deliver.<\/p>\n

Just like new capabilities, Defence\u2019s new people are also taking a long time to arrive. Two weeks ago, the government announced an increase of 12,500 military personnel in the coming decade and a further 6,000 the decade after that. It\u2019s not spelled out in the PBS, but ASPI understands that the $38 billion for the first 12,500 is already built into Defence\u2019s current funding model.<\/p>\n

This year\u2019s PBS gives a hint of how long it will take for them to arrive; there\u2019s no increase in ADF personnel compared to the previous plan until 2024\u201325. In other words, they don\u2019t start to arrive for another two years. And considering the ADF is already 1,600 people short of where it\u2019s meant to be right now, even that might be optimistic. It\u2019s taken Defence the six years since the 2016 white paper to grow by around 1,800 people and, based on the PBS, its numbers have actually gone backwards in the last year.<\/p>\n

Another noteworthy number illustrates the changing role of the ADF. For the first time, Defence spent more on domestic operations helping civil authorities deal with Covid-19 and floods ($257.9 million) than it did on operations overseas ($255.3 million). But there\u2019s little indication in the PBS that Defence is structuring itself to better meet contingencies of that nature.<\/p>\n

The 2020 defence strategic update gave us a few glimmers of different thinking, with hints that Defence would explore asymmetric approaches to deterring threats. So far there have been few signs of that happening. The reprioritisation away from traditional capabilities in favour of cyber revealed in this year\u2019s budget is promising, but there\u2019s a lot more that can be done.<\/p>\n

Note: Due to the upcoming federal election, ASPI is deferring publication of its annual analysis of the defence budget, <\/em>The cost of defence, until early June. In the meantime, we\u2019ll continue to publish short pieces on the budget in <\/em>The Strategist. <\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

The 2022\u201323 defence budget is a conflicted program. In key ways it acknowledges and responds to a changing world, but in others it is a relic of an earlier time. Let\u2019s start with the funding …<\/p>\n","protected":false},"author":767,"featured_media":71573,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_mi_skip_tracking":false,"footnotes":""},"categories":[1],"tags":[44,1972,120,391,1823,26,38],"class_list":["post-71568","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-general","tag-australian-defence-force","tag-australian-signals-directorate","tag-budget","tag-cyber","tag-defence-budget","tag-defence-spending","tag-department-of-defence"],"acf":[],"yoast_head":"\nDefence budget shows signs of a different approach, but is it changing fast enough? | The Strategist<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.aspistrategist.ru\/defence-budget-shows-signs-of-a-different-approach-but-is-it-changing-fast-enough\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Defence budget shows signs of a different approach, but is it changing fast enough? | The Strategist\" \/>\n<meta property=\"og:description\" content=\"The 2022\u201323 defence budget is a conflicted program. 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