Doorstop at Thales Bendigo

CHRIS JENKINS: So I’m really pleased to able to welcome Minister Pyne and Senator McKenzie here to our Bendigo facility where we’re producing the Bushmaster Protected Vehicles for Army and the new Hawkei Lightweight Protected Vehicle for the LAND 121 Phase 4 program. These are really important capabilities for keeping our soldiers safe on the most difficult operations that can be imagined for our Defence Forces, and it also produces I think a great capability that’s now world-leading and ready for export from Australia. So it’s a great- great opportunity to welcome you here, Minister, Senator, and please, I’d like to hear from you.

BRIDGET MCKENZIE: I think it’s fantastic to have the Minister for Defence Industry here in Bendigo where we produce the fantastic Hawkei and Bushmaster. It’s a great example of how Defence Industry can actually support small to medium enterprises, and here in regional Victoria we have some significant contributors to both these projects, employing a lot of Victorians right around our great state. So it’s great to have him here to show the capability that we have locally and so that he can then go and champion this in other areas.

CHRISTOPHER PYNE: Thank you. Well, thank you Bridget. It’s great to be here with Chris Jenkins and his team from Thales, and also with Senator Bridget McKenzie from the great state of Victoria. The first thing I’d like to say is how concerned I am for the victims of the storms in South Australia, and particularly in Adelaide. As an Adelaidean myself with family there, I am obviously going home this afternoon to survey what damage has been done in Adelaide. The SES is still working very hard to make sure that people are safe from harm, and where damage has been caused in trying to repair that damage and get the city flowing again. It’s obviously been a pretty dramatic event, and as a reminder to all Australians of the power of Mother Nature and the damage that can be done, there are also questions I think that need to be answered by the South Australian Labor Government about what solutions they intend to implement to ensure that Adelaide and South Australia has a reliable supply of energy, that it has energy security.

We are a state that has a reliance, a 40 per cent reliance on wind power and some solar power, and while that is not the cause of the blackouts on its own, there are questions to be asked about whether, if there was another gas-fired power station or a coal-fired power station, whether the energy would have been able to be supplied and South Australia wouldn’t have been blacked out. So obviously we are not playing politics at this time, but there does need to be some questions answered by a very long term Labor Government that has put a great deal of store by wind energy, and we now face a third significant power failure in the last 12 months.

But on a happier note, I’m very happy to be here in Bendigo. Bendigo houses some of our most important Defence Industry assets. Thales here, doing the Hawkei and the Bushmaster vehicles, major defence industry contracts, world-leading technologies, and a product that is being exported all around the world, in the case of the Bushmaster – and we’re very hopeful that the same will occur with the Hawkei vehicle – creating jobs and wealth, but also capability in high technology advanced manufacturing, the sort of thing that Australians can do very well. And we should really proclaim from the rooftops the success of programs like the Bushmaster program, and I know also the Hawkei program will be very successful. And from here I got to ADA – Australian Defence Apparel – another great Australian success story, producing 300,000 standard combat uniforms in the last financial year, employing local people in this part of Victoria, and a very successful Australian subsidiary of a Canadian company that is again doing advanced technology high manufacturing, and the kinds of jobs that we can do very well here in Australia.

So I am the Minister for Defence Industry but not the minister for South Australian defence industry. I’m the minister for all defence industry in Australia and I’ve been travelling to Henderson and Cairns and now Bendigo, I was to go to Burnie earlier this week, but I’ll go back there in the near future, Sydney, Brisbane, talking to people in the sector, working out how we can do better, create more exports, more jobs, do more of the work here of the $195 billion over the next ten years of increasing our defence capability. Next week I go to the UAE and Washington and push Australian industry and capability for the joint strike fighter and in our naval shipbuilding programs so it’s a very exciting time to be in defence and defence industry and we do all these things for our own national security but also particularly to protect our soldiers, our airmen and people in the navy as much as we possibly can from harm and from casualties and here at the Bushmaster, of course, program is exactly that, is the world-leading safest form of transporting soldiers in a combat situation and we should be very proud as Australians of what we’ve been able to do in this country.

QUESTION: Minister Pyne can you tell us about the current supply chain agreements for the Hawkai program?

CHRISTOPHER PYNE: Well we are signing with Thales and Raytheon an extension of the supply chain agreements that we’ve had with them for the last few years. This is an opportunity for Australian businesses to have relationships with the primes in defence industry that gets them into their global supply chains. It’s been worth about $785 million of contracts in Australia, to dozens of small and medium enterprises. Thales and Raytheon in this case, set up an industrial unit in their businesses, in their Australian businesses that put SMEs in touch with the global supply chain. They obviously have to compete in that global supply chain with other competitors around the world and they are doing that successfully so what it heralds really is a movement from the Australian government, from a passive player in this space to being a trying to expand Australian SME’s capacity because there’s no reason why we can’t be a global player in defence industry, in platforms, in equipment, in materiel, as other countries have decided to make that a national ambition, so have we.

QUESTION: Is there a need to kiss and make up today at all for Thales missing out on the LAND 400 contract?

CHRISTOPHER PYNE: Well Thales hasn’t missed out on the LAND 400 contract, what’s happened is there’s been a down select to Rheinmetall and to BAE of out of four different companies, one of which wasn’t Thales by the way and those two companies are now involved in a program of identifying how much work can be done here in Australia and Bendigo and Victoria has as much capacity to be part of that process and to win work as anywhere else in Australia, so there hasn’t been a decision about where the majority of that $4 billion to $5 billion contract will be done and I would have thought Thales and other businesses in Bendigo and this area are very well placed to convince Rheinmetall and BAE of their capability and I’m sure that’s exactly what they’re doing.

QUESTION: Just on Hawkei are you pleased with the progress being made so far, the way the contracts proceeding?

CHRISTOPHER PYNE: Yes I am and probably Chris is even better to tell us how he thinks that the program is progressing. We’ve seen today in the factory the work being done on the initial vehicles, I’m going to Monegeetta this afternoon to be part of the testing program there and see what’s being done. Obviously we expect it to be on schedule and on budget and Thales is better placed to tell us whether they think that’s going to happen.

CHRIS JENKINS: Well Minister you’re absolutely correct, the program’s running on schedule and on budget, and they were producing the last of ten vehicles that are going through testing by army and as you say you’ll be seeing some of those and probably driving some of those test vehicles later today and the vehicles demonstrating a high degree of reliability exactly in line with our plans for this stage of the project and will be entering low rate production during 2017 and we showed the Minister and the Senator our new production facility in shop nine out the back of our facility here where we’re setting up for the Hawkei production during 2017 and running through the full rate production in 2018. We’ve mobilised our local supply chain, some fantastic SMEs here in Victoria and right around Australia that have made an incredible contribution not just to the production of this vehicle but right through the design phase and I want to take this opportunity to thank them for the contribution they’ve made in the Hawkei program so far, really looking forward to working with them.

UNIDENTIFIED SPEAKER: Last question.

QUESTION: Minister can I just ask you a couple of questions about South Australia, just Premier Weatherill’s so far showing no inclination to hold an arm’s length inquiry into this power outage and the storms, do you think that’s a good idea and should the Federal Government step in and do it if the state won’t?

CHRISTOPHER PYNE: Well, Josh Frydenberg is handling this matter, and I think handling it very competently. It’s obviously a very serious situation, that in 2016 a whole city’s power can be wiped out because of a - obviously a pretty horrific storm but, you know, there are other parts of Australia that suffer cyclones and- like North Queensland for example, and the whole State’s power is not knocked out. So there are some serious questions to be answered about the reliance on one interconnector between Victoria and South Australia, a reliance on 40 per cent wind power, which in a storm like yesterday’s and last night’s and still continuing today, doesn’t provide the power that the state needs.

There has been an ideological campaign by the left, by Labor and the Greens, to move the country towards Renewable Energy Targets. Renewable Energy Targets are good things and the Government supports them. But the combination of State Renewable Energy Targets and the National Renewable Energy Target is creating a situation in some states where there is a lot of ideology and not a lot of common sense. So while the left lord the fact that South Australia has 40 per cent wind power, we are the state that’s just been wiped out in terms of a blackout of our power. And a lot of politicians are going to duck for cover, but someone has to answer the question about how in 2016, in a first world country, one of the wealthiest countries in the world, we could lose the power for 1.7 million Australians. And simply trying to pretend it’s part of some esoteric national agreements is not going to satisfy the voters of South Australia, certainly does not satisfy me or Steven Marshall.

QUESTION: Can I just ask, pardon the phrase, is it time to shirtfront with Vladimir Putin again in the wake of the latest MH17 Report?

CHRISTOPHER PYNE: Well, I must admit I haven’t been briefed on that this morning, so it would be unwise of me to comment. Lots of politicians comment on things that they haven’t been briefed on, but I’m going to take discretion as the better part of valour.

QUESTION: Just one-

QUESTION: [Talks over] Does nuclear have a future- nuclear power have a future in Australia, Mr Pyne?

CHRISTOPHER PYNE: Well, we don’t produce nuclear energy in Australia and there are no plans to produce nuclear energy in Australia.

UNIDENTIFIED SPEAKER: Great, thank-

QUESTION: Just one quick question about- BlueScope is the only Australian company making the 19 new patrol boats. Will it be given the contract for the build and when will an announcement be made?

CHRISTOPHER PYNE: Well, BlueScope is not building the 21 Pacific Patrol vessels, Austal is building the 21 Pacific Patrol vessels in Henderson, so that information is not right. The contract to build the 19 with the possible two for East Timor has already been announced for Austal in Henderson. BlueScope doesn’t build ships. They do provide steel, and obviously we’d fully encourage them to make the kind of steel that Austal could use for those patrol vessels. It’s a certain kind of steel, because it operates in the Pacific, which has warmer waters than, say, the Indian Ocean or the northern oceans above Australia. So they have to produce the steel that Austal can use to make the patrol vessels. That’s not a decision of the Government’s, that a decision- a commercial decision for BlueScope and for Austal, because if BlueScope decide that they don’t want to make that steel, then obviously they won’t be supplying it. So they have to make those decisions themselves.

UNIDENTIFIED SPEAKER: Great, thank you very much.

BRIDGET MCKENZIE: Thank you. I was going to ask you how you felt being on board the [indistinct] but- yeah…

CHRISTOPHER PYNE: It’s very impressive. And it’s sobering, you know, really, very sobering to think that those vessels have saved so many lives and- of Australian soldiers in the last several years in Afghanistan and Iraq.

BRIDGET MCKENZIE: It’s very impressive.

CHRISTOPHER PYNE: Very impressive, yeah.

UNIDENTIFIED SPEAKER: It’s a life-saving capability.

CHRISTOPHER PYNE: It is. A life-saving capability. A costly life-saving capability, but a worthwhile one.

UNIDENTIFIED SPEAKER: Worth every cent.