Australian Border Force defies advice, gives defence company Austal $39m

2015-2016

Success fee was dependent on Austal delivering eight problem-free patrol boats; the Cape class boats were plagued with problems; success fee still paid.

The Australian Border Force allegedly improperly funnelled $39 million to defence company Austal, according to The Age.

In late 2015 and early 2016, Australian Border Force reportedly disregarded internal advice that it should not pay Austal part of a $44.6 million success fee for delivering patrol boats used to target people and contraband smugglers and illegal fishing. 

The fee was meant to be paid only if Austal met key milestones to deliver eight problem-free patrol boats. The boats were delivered but were plagued with problems.

However, after intense lobbying by Austal, Border Force paid out $39 million.

The Australian Commission for Law Enforcement Integrity launched the inquiry into Austal following a December 2018 Auditor-General’s report that highlighted how the $39 million milestone payment was made without a proper basis.

The Age also noted that in the FY 2015-16, Austal donated $60,000 to the Liberal Party and $1500 to the ALP.

Around April/May of 2019, Austal was awarded a $324 million contract to supply six Cape Class Patrol Boats for the Australian Navy.

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