28 May 2009

Defence White Paper: the numbers do not add up

Today’s Australian Financial Review contains a significant news item sparked by the annual assessment of the defence budget by Australian Strategic Policy Institute (ASPI) analyst Mark Thomson. The report begins:

The leading defence think tank has slammed the government for being excessively secretive about the defence white paper and budget spending, but warned that even on the incomplete information available there would not be enough money to fund its ambitious 20-year weapons plan.

I have not yet completed my study of the defence budget papers, and have not yet had the opportunity to read Mark Thomson’s assessment at all. I have high regard, however, for Mr Thomson’s analytical skills and for his annual assessments of the defence budget, and accordingly would be inclined to take his headline conclusion at face value.

Mr Thomson’s conclusion bears out my comment at paragraph 12 of Defence White Paper: an appraisal, in which I said that the discussion of how all this capability was to be financed was unconvincing, a scepticism I went on to confirm, in the light of the program’s dependence upon savings, in Defence Savings: The Strategic Reform Program. I supported this view with an example of a previous savings program that went horribly wrong and ended up costing rather than saving money.

So, regrettably, the numbers don’t add up – and don’t forget you heard it first from me.

The Defence White Paper stands in danger of being an event (its launch) rather than a strategy.

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