Media were not invited to the event, but InDaily has heard a recording of her speech, in which she emphasised that the Commonwealth “will not be rushed” into a decision about the lucrative contract, which she dubbed “our most complex and costly procurement ever”.
This fuelled fears from industry insiders that awarding the hotly-contested contract will be delayed until after next year’s federal election.
A new defence White Paper has already been pushed back until the first quarter of next year, with critics warning that a failure to commit to the promised 12 vessels will not guarantee the continuous build necessary to avoid a so-called “Valley of Death”.
Payne told the gathering that “a key element of the Government’s naval shipbuilding plan will be implementation of a continuous build in Australia of surface warships”, but did not include the submarines in that assessment.
“This will address the peaks and troughs that have beset naval shipbuilding in Australia for decades,” she said, revealing that the Government has commenced a new competitive evaluation process for both the future frigates and offshore patrol vessels.
The Government last month received formal submissions from the three companies bidding for the submarine contract, based in Japan, Germany and France.
“A review (of those submissions) is currently underway, and advice will be provided to the Government in 2016,” Payne said.
“This is clearly an extremely important process and it will take time. Let me be very clear about one thing – the Government won’t be rushed about making a decision of that nature, and we won’t rush defence in terms of providing the best advice.
“The Government will take the time necessary to evaluate the proposals … this is a decision we must get right.”
One industry insider present told InDaily the speech signalled that the white paper would only commit to an eight-vessel build, and that a decision on the contract itself was likely to be delayed to avoid a potential electoral backlash when the Turnbull Government seeks re-election.
They said the message was one of more delays on a decision crucial to an industry that “has been waiting for years and years”.
The submarines issue has been cited as a major factor in several SA seats, with Nick Xenophon’s fledgling party the likely beneficiary of voter discontent.
Industry commentator Chris Burns from SA’s Defence Teaming Centre attended the breakfast and released a statement saying: “The defence industry looks forward to greater certainty when the Defence White Paper is released early next year.”
“We are hoping the new policies released with the White Paper reflect a greater long term vision,” he said.
“History has shown us we cannot be globally competitive if we persist with the cyclical stop-start nature of managing defence projects in isolation.”
Payne’s visit coincides with a slanging match between Jay Weatherill and his West Australian counterpart Colin Barnett, who yesterday slammed the SA Premier as “a bit of a dill”.
SA and WA are both eyeing off a stake in the construction of the navy boats and submarines, with Weatherill this week dismissing Barnett’s state as a defence blow-in that ignored the defence industry during its mining boom.
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