Military Capabilities

Audit warns of ‘high-to-extreme’ risk to Australian naval shipbuilding plan

16 May 2018

The Australian government has been warned by its Department of Defence (DoD) that the country’s AUD89 billion (USD67 billion) naval shipbuilding plan for submarines, frigates, and offshore patrol vessels (OPVs) carries a “high-to-extreme risk”, the Australian National Audit Office (ANAO) disclosed in a report published on 14 May.

“Key risks relate to the delivery of expected capability, programme cost, ability to meet programme schedules, and management of the industrial base. The Naval Shipbuilding Plan did not address the management of these risks in any detail,” said ANAO.

The audit also criticised the government and the DoD for failing to implement changes to work practices needed to ensure shipyard productivity and bring down costs, as well as for failing to provide evidence of the economic boost that the investment in a home-grown defence industry would generate.

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