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Counting the real costs of submarine building program


AS Prime Minister Tony Abbott arrives back in Australia following a whirlwind free trade tour in Asia, focus has turned to the Australian government’s next defence white paper.

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Due to be released in early 2015, the Federal Government is keen to create savings wherever they can and attention has now fallen on the defence portfolio, which may have dire effects for South Australia.

The Australian Submarine Corporation (ASC) based at Osborn employs 1000 people to maintain the fleet of six Collins Class submarines with another 1240 working on the Air Warfare Destroyer project.

A further 700 are directly employed at the Techport site in the roles of suppliers and other directly related industry.

Cut-away diagram of the Collins Class submarine.

Construction on the first submarine, HMAS Collins, started in 1990 with the sixth and final submarine, HMAS Rankin, being handed over to the Navy in 2003 – a period of 13 years from beginning to end of the build program.

Experts suggest 12 submarines would be the ideal number for patrolling our prodigious coastlines – Australia has six.

A recent, expert report into the sustainment of the Collins Class submarines has described progress over the past 15 months as a ‘remarkable transformation’  and  ‘astonishing turnaround’.  

The progress review by John Coles shows ASC is on track to achieve the international benchmark of three submarines materially available for sea at all times by 2017.

Late last year, ASC announced it would progressively move to a 10 and 2 operating cycle where submarines would spend 10 years in service followed by a 2-year Full Cycle Docking. This compares with the previous 8 and 3 operating cycle. The first of these 2-year Full Cycle Dockings will start this year.

Speaking at the Australian Strategic Policy Institute conference in Canberra on Thursday, Federal defence minister David Johnston said he supported South Australia building the next submarine fleet – at the right price.

The argument against building submarines in South Australia is that it may be cheaper to buy the components “Military Off The Shelf’’ (MOTS) from another country and then put the submarines together at the Osborne base.

Also addressing the conference on The Submarine Choice was ASC chief executive officer Stephen Ludlam who isn’t sold on the MOTS idea.

ASC Chief Executive Officer, Stephen Ludlam.

He is concerned that when faced with repairing something someone else has made it can be more difficult than if you just built it yourself in the first place.

Mr Ludlam also made some telling points including the fact the more submarines you build the cheaper it becomes.

Workers become more skilled in this rarefied field, managers more experienced dealing with unique problems and processes are constantly refined and improved.

The uniquely skilled workers at Osborne are writing the book on Collins submarine maintenance – and they are learning at an exponential rate.

“The common norm in submarine building is that you can be reasonably efficient after building three submarines, but after the fourth you become a lot better and thereafter they become cheaper to build with no loss in quality,’’ Mr Ludlam told the conference.

‘’If we have a consistent build program at a prescribed length between each ship, that allows us to grow our efficiency at all times.‘’

State government figures show the maintenance of Collins submarines alone contributes $150 million each year to the state’s economy.

It is also estimated the AWD project, in it’s peak years, has the potential to add $250 million a year to the South Australian economy.

The ASC also invested in its own specialised apprenticeship training program, teaching skills vital to the continuing development of the industry, skills that would be very expensive to replace if lost. 

This is a Creative Commons story from The Lead South Australia, a news service providing stories about innovation in South Australia. Please feel free to use the story in any form of media. The story sources are linked in with the copy and all contacts are willing to talk further about the story. Copied to Clipboard

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