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Category: Federal Government / Government and Politics / Federal Parliament / Defence and Aerospace Industries / Defence and National Security

Government shipbuilder ASC all at sea on submarine building work

Tuesday, 18 Oct 2016 09:20:33 | Greg Jennett

Finance Minister Mathias Cormann is a shareholder-Minister of shipbuilding company ASC. (ABC News: Luke Stephenson)

Government-owned shipbuilder ASC and its shareholder-Minister have been unable to explain what role the company will play in the $50 billion building phase of the Future Submarine fleet.

ASC executives have fronted Senate Estimates hearings alongside Finance Minister Mathias Cormann, where the Government's recent decision to break-up the company into three separate businesses dominated inquiries.

The company, once famously described as being incapable of "building a canoe", is to be divided into an infrastructure business, a shipbuilding arm and a business for "sustaining" (maintaining) submarines.

Labor Senator Alex Gallacher and Nick Xenophon of NXT have asked repeated questions about why ASC's new structure does not include a division for building the French-designed Short-Fin Barracuda and what work it is doing to develop its submarine building operations.

Neither senator was satisfied with the answers given and Senator Xenophon grew exasperated with the Finance Minister.

"Minister, you don't find it curious that Future Submarine building is omitted from the new structure?" Senator Xenophon asked.

South Australian senator Nick Xenophon talks to colleagues during Senate Estimates. Photo: South Australian senator Nick Xenophon asked questions about ASC's new structure. (ABC News: Luke Stephenson)

The Minister explained that "you know those submarines will be built in South Australia, you know they will be built in Osborne and you know they will be built on ASC infrastructure and any contracting arrangements between ASC and DCNS are a matter for the Defence portfolio to essentially pursue".

ASC chief executive Stuart Whiley added "we have had meetings with DCNS since the contract has been signed to provide services to support them in their endeavour with the submarine build".

Even without a specified role for the Government-owned shipbuilder in making the 12 DCNS submarines, its yards at Osborne in Adelaide will be very busy making or partially making 54 naval ships in the decades ahead, including Offshore Patrol Vessels, Future Frigates and Pacific Patrol boats worth almost $40 billion.

The Government insists it is not "privatising" ASC, but Defence analysts doubt it will play a direct role as the contracted builder of the French submarine.

But ASC's newly-created infrastructure division does stand to reap some financial benefit from construction phase of the Future Submarine fleet, by providing "landlord" services at its extensive industrial land holdings in Osborne.

AustraliaPlus


 

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