Defence commits $151m to AUKUS pillar two

Brandon How

Initiatives under AUKUS Pillar II have been given a $151.6 million Budget commitment over the forward estimates, with around $900 million committed to broader Defence innovation programs over the next four years.

Although funding for AUKUS Pillar II is not explicit in the Defence portfolio Budget statement, the commitment was highlighted in a joint statement by the ministers responsible for the Defence portfolio and confirmed by a department spokesperson.

The Defence portfolio statement also highlights that an initial $748.4 million has been allocated to the newly-announced Advanced Strategic Capabilities Accelerator (ASCA) over the forward estimates.

Some of the technologies included under AUKUS Pillar II are quantum technologies, AI and autonomy, hypersonics, and advanced cyber, but it not yet clear the types of programs that will be supported through the program.

The $3.4 billion committed to the ASCA over the next decade will be met entirely from money repurposed from other Defence projects. The additional funding will come from the reprioritisation of work under the Integrated Investment Program – so far having freed up an initial $7.8 billion – which was announced alongside the release of the Defence Strategic Review, and will be finalised in 2024 when the first biannual Defence Strategy is launched.

When the accelerator was officially announced by Defence minister Richard Marles and Defence Industry minister Pat Conroy at the end of April, it was touted to include “$591 million above current planned spending on Defence innovation”.

The Defence Strategic Direction Statement highlights improving Australia’s “capacity to rapidly translate disruptive new technologies into ADF capability, in close partnership with Australian industry” as one of the Australian government’s six Defence priorities.

This was also highlighted by the Defence Strategic Review. Over the first 18 months, the accelerator will be set up within the Department of Defence while the operating model is developed and refined.

It is a replacement of the Defence Innovation Hub and Next Generation Technologies Fund, which have been deemed not-fit-for-purpose given Australia’s current strategic environment.

The review called for the accelerator be established as an independent entity outside of Defence, although this was not a formal recommendation.

“It is our view that ASCA must be an unencumbered entity outside of Defence that receives capability priorities from Force Design Division and works with industry to develop innovative asymmetric capability solutions,” the Defence Strategic Review reads.

ASCA is also a refresh of the initial $2 billion election promise to establish the Advanced Strategic Research Agency, which was to have been based on the United States DARPA program.

Other Defence industry funding measures include the previously announced $4.1 billion for long-range strike capabilities and the $3.8 billion for a build out of base infrastructure in Northern Australia.

Defence Industry minister Pat Conroy said that Australia needs to support development of the appropriate capabilities for its strategic environment.

“We are creating Australian jobs in defence industry, as well as lifting our capability. Urgent reforms to Defence procurement processes will deliver this capability faster, building on improvements already delivered to get projects of concern back on track,” Mr Conroy said.

Assistant minister for Defence Matt Thistlethwaite added that the government’s investments in Defence will create new highly skilled jobs and enable “small and medium sized businesses to expand and grow”.

Defence spending is expected to grow over the next decade, and will be 0.2 per cent higher by 2032-33 as a proportion of GDP.

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