Australian government sends ASC confusing instructions

TOM RICHARDSON 

ADELAIDE | The Defence Department has issued an edict to Government-owned shipbuilder ASC that it must deal “fairly and equally” with all prospective international contractors for the lucrative future submarines project.

The missive, revealed today by SA Senator Nick Xenophon during a Senate committee hearing in Adelaide, belies the Abbott Government’s public rhetoric that the Osborne-based shipbuilder should pick an international partner with which to put forward a joint bid.

Defence Minister Kevin Andrews announced in February that the contract would be determined by a “competitive evaluation process”, saying “for the best opportunity to maximise their involvement in the program (ASC) needs to work with an international partner”.

Just last week, SA-based Liberal heavyweight Christopher Pyne urged Xenophon to “assist ASC in putting together a competitive bid for the new submarine project as part of a joint venture with another submarine builder”.

Xenophon today quizzed ASC representatives to the Senate inquiry into the future submarine project whether such a joint venture was actually allowed, “given your instruction from defence”.

“You can’t act on that on the basis that you’ve received quite reasonable instructions from defence to deal with prospective international bidders in an even-handed manner,” asserted Xenophon.

ASC’s chief operating officer Martin Edwards said the company’s “role at the moment is to help those potential partners understand the skills capability and where we can assist, particularly because we’ve had many decades of shipbuilding in Australia”.

He said a potential design partner would not be known until the evaluation process was completed.

“From as ASC perspective, we’re agnostic in relation to whether it’s Japan or Germany or France – we’ll work with any one of those,” Edwards said." See WHOLE ARTICLE.

It appears that as the German (TKMS) and French (DCNS) competitors have much greater experience than Japan in participating in major defence consortiums the Australian Government does not want to put Japan at the disadvantage of facing actual competition. Put another way the Government does not want ASC to choose an international partner on that partner's merits. The Government wants Japan's special position in the so-called "competitive" evaluation maintained.

Of course the Australia Government's hands are tied. The US has already selected Japan to win the "competitive evaluation process" and what the US says goes.

Pete