Scrap submarines project before it’s too late says former public service boss

by | Feb 3, 2020 | Government

Australia’s $225 billion SEA 1000 submarine project is so high risk, it would be better for Department of Defence to scrap it and start again, writes former public service chief, Jon Stanford, in the final instalment of his Second Rate Leadership series. 

In addition to some very serious problems with progress with the SEA 1000 program, there are some more fundamental questions to be addressed in the longer term. The first of these is whether the Attack class will embody the technologies required to be successful in its operations in the mid-2030s and beyond. In other words, will it be fit for purpose? An associated question is around the submarine’s cost effectiveness. The escalating cost of this acquisition means that the opportunity cost is also going up. With the submarines being designed mainly for joint operations with the US Navy, there are also significant risks in the future around whether a continuing US presence can be assumed.

In regard to the first question, it is very difficult to be able to judge whether the submarines will be fit for purpose if we do not know what that purpose is. Based on comments and submissions to Parliamentary inquiries from former Australian submariners we can be fairly confident that our submarines’ main area of operations (AO) is in the South China Sea, 3,500 nautical miles from base. But once there, we are not told what they do. In Australia at least, the missions the submarines undertake are classified.

After two years of research and without reference to Australians who know, we finally found out what the submarines do. As Chris Uhlmann has suggested, if you ever want to know what the ADF is doing, go and ask the Americans. We didn’t exactly ask them, but we commissioned Dr Google to trawl through official and unofficial American sites. We also did a lot of research on what British submarines did, in close cooperation with the Americans, in the North Atlantic during the Cold War.

On the basis of this information, we can confidently assert that while the Attack class may be “regionally superior” in the Tasman Sea or the Southern Ocean when they enter service, they will have an uphill battle to exhibit superiority in their primary AO in the South China Sea. By the mid-2030s, let alone the early 2050s when the last new submarine will be delivered, the South China Sea will be teeming with submarines, with around 350 of them calling that area of operations (AO) home. Many of these will be nuclear powered attack submarines (SSN), which a conventional submarine lacks the speed to track effectively. Contemporary designs of submarines also include the ability to deploy autonomous underwater vehicles (AUVs) with an increasing level of capability. The Attack class, however, offers only the capability to launch a relatively small AUV through a standard 533mm torpedo tube.

As with all conventional submarines, the Attack class will have a significant speed disadvantage compared to a modern SSN, without necessarily being substantially more stealthy. As presently designed with no air-independent propulsion, lead-acid batteries and inefficient pump-jet propulsion, it will have limited dived endurance. When it comes up to periscope depth to snort and recharge its batteries, it will be increasingly prone to detection by satellites, fixed- and rotary-wing aircraft, surface ships, other submarines and seabed sonars. Were it to be equipped with modern batteries, its endurance would be substantially increased, but it will still need to snort from time to time. There is nothing to be done, however, about the low sustainable speed of a conventional submarine. This restricts its ability to interdict fast, high value targets and also, critically, the ability to break contact and make off at sustained high speed if detected.

As part of an overall anti-access and area denial (A2/AD) strategy within the Nine Dash Line, the PLA Navy is already focussing a great deal of effort in improving its anti-submarine warfare (ASW) capability — promoted in the popular media as constructing ‘an underwater Great Wall’ to deny access to foreign submarines. Around sensitive areas like Hainan Island, seabed sonar arrays are being installed that mimic the US Navy’s SOSUS system. New PLA Navy frigates deploy superior ASW detection sensors to our Navy’s surface fleet – you won’t find a towed array on a RAN platform except a Collins class submarine – while their new frigates deploy two-tailed sonar and specialised ASW helicopters with, by some accounts, excellent sensors capable of detecting a snort mast (submarine’s snorkel) at long range.

For a conventional submarine, without the ability to break contact when detected and make off at high speed, the operating and tactical environment in the South China Sea in the 2030s and beyond will raise serious questions about both effectiveness and survivability. Even now, covert operations in those waters may have entered the ‘grey zone’ between peace and war. In the future, the intensity of submarine operations will increase.

The overall effectiveness of Australia’s Submarine Force is also determined by the ability to deploy sufficient force on station so as to represent a credible deterrent. Even with world best practice submarine availability, which Australia now has, the distance to the submarines’ AO in the South China Sea relentlessly takes its toll on the ability to deploy a sufficient force on station. With a fleet of 12 boats we will be able to guarantee just one submarine being on station at any time, with an additional boat being available from time to time. And this capability will not be available for thirty more years when the twelfth submarine will have been delivered. No matter how powerful the platform, with half the world’s submarines operating in this theatre this is a very small force indeed. Of course, with their far higher transit speed, a force of SSNs deploying AUVs could deliver a considerably superior capability.

In addition, at a whole of life cost of $225 billion, this deterrent, such as it is, has a very high opportunity cost. Two former RAAF Chiefs have recently proposed that the ADF needs to acquire a long-range bomber force. Even if the new American B-21 bomber delivers only half the capability currently being spruiked, the early acquisition of two squadrons – 48 aircraft off the shelf – at a cost of around $50 billion looks an attractive power projection proposition. By comparison, the ability to put one conventional submarine on station “up threat” at any time at an acquisition cost of $80 billion, with associated doubts around its effectiveness and survivability, must be of questionable value.

The elephant in the room here, of course, is whether the Americans will still be around in 15 years time. Hugh White thinks America will go home. Other allies are becoming increasingly concerned with the level of commitment shown by Trump’s America. The problem here is that the Attack class has been designed for covert operations in close liaison with the US. If the US did go home, taking all their networks and infrastructure with them, it is very difficult to discern a role for the Attack class for which they would be well suited. A fleet of nuclear-powered submarines, on the other hand, could provide a much more credible deterrent under a defence of Australia strategy.

In summary, therefore, even though it is early days in the SEA 1000 program, some very serious problems are arising, in the short-, medium- and longer-term. Two years before even a preliminary design of the Attack class submarine has been produced, questions are arising over the delivery schedule, the budget and Australian industry content. There is a serious danger of a capability gap.

There is also a legitimate concern that when the submarines are eventually delivered they will not be fit for purpose in terms of their effectiveness and survivability. The strategic situation in the region is dynamic; there are real issues around whether a conventional populated submarine will still be relevant, or remotely cost-effective when the first of class enters service in the mid-2030s. There are also questions as to its relevance more generally if the Americans retreat east of Hawaii. These longer-term risks need to be addressed just as much as the short-term risks to the program need to be mitigated.

What is to be done?

In general, the government needs to demonstrate the leadership that so far has eluded it. It needs to develop measures to provide an adequate measure of insurance against the very substantial risks we confront.

First of all, Ministers need to take measures to bring the SEA 1000 program back on track. Defence’s response to the ANAO concedes that the program risk is very high. In sum, the risks associated with this submarine contract with the French are unacceptable. We believe that the best way to mitigate the risks is to introduce competition to the process so as to restore a proper balance to the commercial relationship with Naval Group. The extension in the design process for the Attack class means that there is enough time to do this without causing any further delays.

While Defence officials give every indication of being unwilling to change course, Ministers need to assert their leadership and adopt a proper risk mitigation strategy by commissioning a preliminary design study for an evolved Collins class platform. As detailed in the Submarines for Australia submission to the ANAO, the work done by the Four Admirals has led to a substantial proposal for a Collins 2.0. This aligns with international best practice. In order to reduce the very high risks involved in designing a submarine from scratch, almost all major countries that produce submarines evolve a new design from the previous class.

We would further extend this competition so that when the two rival designs are produced, probably early in 2022, both Naval Group and Saab/ASC should be requested to submit fixed price tenders for construction of the first six new submarines. The tenders would include commitments on cost, delivery, Australian industry content and IP rights. We consider this process would lead to a significant reduction in cost, improve delivery perhaps by five years and provide substantially superior outcomes in terms of Australian industry content and access to IP.

The introduction of competition would in no sense represent a policy reversal. Instead, it is a very sensible insurance policy against the considerable risks of the present contract with the French failing to deliver what is needed on time and on budget. With no additional delays to the current program and at a cost of less than 0.1% of the SEA 1000 program budget, we believe this risk mitigation strategy would be money very well spent.

The government also needs to address other longer-term risks. In order to address the possibility that a conventional submarine will not be effective in high intensity operations by the 2030s, the review of submarine technologies flagged in the 2016 Defence White Paper should be brought forward. If the government wants to continue clandestine operations “up threat” and far from base, they will need to consider acquiring nuclear powered submarines. They also need to consider the use of autonomous underwater vehicles (AUVs).

Finally, as with climate change, leaders need to make strategic judgements on the basis of the best available evidence rather than ideology. Even if you do not believe that the Americans will go home, the risk nevertheless is there and any prudent government should insure against it. In terms of Realpolitik, it’s all very well to get misty eyed about the Battle of the Coral Sea as long as you also take heed of Henry Kissinger’s wry judgement: “It may be dangerous to be America’s enemy, but to be America’s friend is fatal”. In addition to its strategic policy review, the government should commission a comprehensive force structure review. This review should be instructed, inter alia, to place the highest priority on the future defence of Australia, with coalition operations still important but clearly a secondary objective.

In a former life, Jon Stanford was a Division Head in the Department of the Prime Minister and Cabinet. Currently, as a Director of Insight Economics, he is undertaking significant research on Australia’s future submarine project, generously supported by Gary Johnston, owner of the Submarines for Australia website.

Read Jon Stanford’s previous articles in this series on Defence:  ‘Second Rate Leadership, part 1’ here, ‘Second Rate Leadership: immense Defence spend unlikely to secure Australia in a new world order’ here. and ‘The Ultimate Boondoggle: submarine flop risk is “high to severe”‘ here

The above article was first published in Pearls and Irritations and is republished with permission.

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ABOUT THE AUTHOR

Jon Stanford

Jon Stanford

Since taking up a career as a consultant in the mid-1990s, Jon Stanford has developed a strong practice in economics and policy issues related to climate change, energy, the resources sector, industry development and defence. In this period, Jon was a Director of the Allen Consulting Group for over ten years before leaving to establish a new firm, Insight Economics, with Dr David Charles and Melanie Kelly as well as two other consultants. From 2006-09 Jon was a Partner with Deloitte and helped to establish their new economics practice. Throughout his consulting career, Jon has worked closely with two economic modelling agencies: the Centre of Policy Studies at Monash University and, for energy market modelling, McLennan Magasanik Associates. Before becoming a consultant, Jon Stanford had a significant career with the Australian Public Service working in areas that involved economics and public policy. His final position was as a Division Head in the Prime Minister’s Department.

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