SA-built frigates sink from nine to six as costs blow out by $20 billion

Six Hunter Class frigates will be built at Osborne, three less than originally planned, due to a cost blowout and rethink of the Royal Australian Navy’s surface fleet strategy.

Feb 20, 2024, updated Feb 20, 2024
Defence Minister Richard Marles today announced six Hunter Class frigates will be built in South Australia, down from nine first planned. Photo: Tony Lewis/InDaily. Frigate image: BAE Systems. Design: James Taylor/InDaily.

Defence Minister Richard Marles today announced six Hunter Class frigates will be built in South Australia, down from nine first planned. Photo: Tony Lewis/InDaily. Frigate image: BAE Systems. Design: James Taylor/InDaily.

Defence Minister Richard Marles confirmed the South Australian build in a naval surface fleet review announced this morning, and said Osborne shipbuilders will also upgrade the Navy’s Hobart Class air warfare destroyers while the six Hunter Class frigates are completed.

Marles also said that a replacement for the Hobart Class destroyers will be built in Adelaide immediately following the completion of the Hunter Class ships, but the design of the replacement is yet to be confirmed with the decision to be made “later in this decade”.

The federal government said the frigates program was going to cost $20 billion more than planned, leading to a cut in the nine Hunter Class frigates first announced by the former Coalition government.

BAE Systems is currently conducting a Hunter Class frigate design and manufacturing pilot at the site, with the first warship scheduled for delivery in 2032.

While nine Hunter Class frigates were announced for Adelaide several years ago, Marles said on Tuesday that changes were made following “the government’s careful consideration of the recommendations of the independent analysis of the surface combatant fleet, commissioned in response to the Defence Strategic Review”.

The government said strategic circumstances “require a larger and more lethal surface combatant fleet, complemented by a conventionally-armed, nuclear-powered submarine fleet”.

The Defence program announced today said construction of Hunter Class frigates at Osborne would sustain at least 2000 jobs and create at least 500 new jobs over the next decade.

The Navy’s Hobart Class air warfare destroyers will get upgraded air defence and strike capabilities through the installation of the US Navy Aegis combat system at Osborne.

This includes replacing harpoon anti-ship missiles with naval strike missiles and installing long-range Tomahawks missiles.

The Navy’s future surface combatant fleet will comprise 26 ships – the largest Australian fleet since WWII – including the three upgraded Hobart Class air warfare destroyers and six Hunter Class frigates.

Another 11 general-purpose frigates and six new Large Optionally Crewed Surface Vessels (LOSVs) are also planned, with the first three general-purpose frigates to be built overseas so they’re in the water faster, before the rest are built in Perth.

The Albanese Government has committed to giving Defence an extra $11.1 billion over the next decade, bringing the total Naval funding over the next ten years to $54.2 billion.

“The enhanced lethality surface combatant fleet will ensure the Navy is optimised for operations in our current and future environment, underpinned by the meticulous assessment conducted by the Independent Analysis Team,” Marles said.

“Australia’s modern society and economy rely on access to the high seas: trade routes for our imports and exports, and the submarine cables for the data which enables our connection to the international economy.

“The Royal Australian Navy must be able to ensure the safety and security of our sea lines of communication and trade routes as they are fundamental to our way of life and our prosperity.”

Defence Industry Minister Pat Conroy said the “significant advancement in Navy capability that will be delivered under this plan requires a strong, sovereign defence industry”.

“This plan ensures Navy’s future fleet can meet our strategic circumstances by delivering a larger and more lethal fleet sooner and secures the future of naval shipbuilding in Australia, supporting 3,700 direct jobs over the next decade and thousands of indirect jobs for decades to come.”

‘Nothing more than a media announcement to fill the gap’

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State opposition leader David Speirs was critical of the announcement ahead of the formal release this morning, saying South Australians had “heard it all before”, and that “we’re stuck in a bit of a loop when it comes to defence building projects in South Australia”.

“A boulevard of broken dreams, I’ve had it been described,” he told ABC Radio Adelaide.

“I try to be as bipartisan as possible when it comes to defence industries – they’re too big and too important to this state to fail. But I’m exceptionally worried: with the reduction that means a reduction in jobs, and in the 2030s some amorphous project in the future to fill that gap.

“It’s just hard to believe that it will ever happen and that it is nothing more than a media announcement to fill the gap to spin it today. It’s that valley of death in the 2030s that worries me so much.

“We’ve got to stick together on this one and I think the federal government has sold us out – there’s so much uncertainty ten years from now.”

Premier Peter Malinauskas said today’s announcement was significant, with confirmation at last of a frigates program in Adelaide.

Premier Peter Malinauskas talks to BAE Systems workers at Osborne following the release of the Navy’s surface ships review. Photo: Tony Lewis/InDaily

“What we’ve seen previously is commitments to frigates; there’s been a mention of nine [frigates] but never a contract and never dollars in the budget to actually build the machines,” he told ABC Radio Adelaide.

“What you see down there [at Osborne] is actually a pilot,” he said.

“The pilot is of such a high quality that they believe, in the event that there is the commitment and the funds to actually build the first frigate that some of those materials will be able to be used in the first frigate itself.

“You don’t get a sixth or seventh, eighth and ninth or 20th or 21st ship unless you get a first, and that’s what’s significant today. For the first time today, we’re going to see significant dollars committed into the budget – very significant dollars.”

At a later press conference at BAE Systems at Osborne, the Premier said it was a “great day for South Australians, with confirmation a continuous shipbuilding program in Adelaide has been locked in for decades to come”.

He said the Hunter Class frigates would be built until 2042, followed by the replacement for the Hobert Class AWD, on top for more than 4000 workers employed on the AUKUS nuclear-powered submarines build.

with AAP

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