In a previous piece, we examined the broad schedule of Australia's capability transition from conventional submarines to nuclear-powered submarines (SSNs). In planning the transition, we shouldn't just be focusing on the point when the first SSN enters service, which appears to be around 2040 at the earliest, based on statements from the government. There are later, equally significant milestones, such as when Australia will have a viable SSN capability (likely requiring three or four boats), when the Collins-class submarines can be retired and when the final SSN enters service. Those things will occur in the late 2040s, 2050s or even 2060s. The key point is that we need to manage the capability risk across the entire transition.
We've also argued that the government should consider a broad range of industrial approaches to building the SSNs, including an enterprise approach with our strategic partner, whether that's the UK or the US. We noted that the government might still decide on a domestic build if our strategic partner didn't have sufficient capacity to build submarines for us. Deputy Prime Minister and Defence Minister Richard Marles has now said that the fastest way to acquire SSNs will be to build them here since "the industrial capabilities of both the United States and the United Kingdom when it comes to building subs are at full capacity". Of course, it's not yet clear what work will be performed here, but the government appears to have made an assessment that acquiring complete boats overseas is not viable.
And we've argued that Australia is facing a submarine capability gap, even if the Collins-class life-of-type extension is successful—a view shared by the government. It's important to note that the risk in the submarine transition is compounded by a similar (if not quite as severe) risk in the Royal Australian Navy's transition in its frigate force from the Anzac class to the Hunter. So we shouldn't regard the surface fleet as a significant risk mitigator for the subsurface fleet.
Given the risk inherent in a capability transition involving the certainty of a decline in the existing capability and the uncertainty of the schedule for delivery of the new capability, combined with the high likelihood that the best-case scenario will involve a reduced number of submarines for a large part of the transition, it's not surprising that many commentators have called for rapid capability acquisitions to manage the risk.
In subsurface capability, there are three high-level options. They're not mutually exclusive, and the government will likely need to adopt a combination of them. Since the new government has confirmed its commitment to AUKUS and the acquisition of SSNs, cancelling the pursuit of an SSN capability is not one of the three.
The first option is to accelerate the establishment of the SSN capability. No doubt the government's nuclear-powered submarine taskforce is examining options to do that, but it will be challenging. We have already discussed the issues involved in getting an existing US or UK boat or getting a boat already under construction on an overseas production line. Either approach would take capability away from our partners, contradicting the intent of AUKUS. And, as noted above, Marles has said our strategic partners don't have the industrial capacity to build additional boats.
So, while getting SSNs early from overseas is worth exploring, it seems unlikely to happen. And while getting an SSN or two early may help manage some risks at the start of the transition (while also potentially introducing some new ones), by itself it won't advance delivery of the rest of the capability, meaning the later milestones are just as far away.
Bringing those milestones forward would require accelerating the start of a local build. In our view it will be difficult to get the first locally built boat into service before 2040, even with significant help from our strategic partner. Before we can start, we need to build a shipyard and train a workforce. It's currently taking the US eight years to build SSNs on mature production lines. It's hard to see us doing better from a cold start. Even if we can shave a year or two off the process, we still get into the drumbeat issue: production capacity means submarines will likely be delivered on a three-year (or slower) drumbeat, getting us well into the 2040s before we have an actual capability. In short, this option alone won't address the capability gap.
The second option is to acquire a conventional submarine as a gap-filler, which we'll discuss in more detail in later articles, but before the government defaults to that option it should carefully examine a third option, namely, to look beyond submarines—as Marles has said he will. The key is to focus on the effects we seek from submarines and see how we can achieve them more quickly (and possibly more affordably) with other systems. For example, if one of the effects we seek from SSNs is a long-range strike capability that can act as a conventional deterrent against an aggressor, we could investigate other systems with that capability.
As ASPI's most recent defence budget brief notes, there are many possibilities across the spectrum of cost and technological maturity. One high-end option would be the B-21 bomber that's being developed for the US Air Force. It would deliver a massive capability boost. And, if we're looking at effects, it can deliver a broad range of them, including anti-submarine warfare if we consider that it can be conducted by sinking boats in harbour or by air-delivered mines. The B-21 could potentially be delivered in useful timeframes, but the cost would be so large (indicatively, $25–30 billion for a squadron of 12 or so) that it could be met only by cancelling another megaproject (preferably one not already in contract) or by increasing Defence's funding line significantly.
A more affordable option could be an uncrewed aerial vehicle capable of long-range strike. Nothing suitable exists yet, but investing in the development of a twin-engine, long-range version of Boeing's Ghost Bat could be explored. Long-range missiles are another alternative, as are fleets of 'the small, the smart and the many' (that is, fleets of small, almost disposable systems that can be quickly built at scale, deployed, lost and replaced).
One path that the government should consider urgently is the possibility of "up-gunning" the offshore patrol vessel fleet. These vessels are about to enter service, have sufficient space to carry lethal capability and can be produced quickly and at scale. One option could include installing the Kongsberg naval strike missile launcher that is already being acquired for larger surface combatants. Anti-submarine warfare sensors are another possibility. The RAN can't afford the luxury of operating 1,800-tonne vessels with no warfighting capability.
But it's hard to ignore the calls for our second option, a new conventional submarine. The proposals have ranged from a repeat of the current Collins class, built to the original design and standards—but presumably with the extensive upgrades installed since the original build, including those planned for the life-of-type extension—to an essentially new design, based on the Swedish A26, for example.
Any new conventional submarine introduced within the next decade is unlikely to be retired quickly. Depending on which point of the SSN transition it served until—and it's possible the last of the first eight SSNs may not enter service until after 2060—a new conventional class of submarine could be in service for 30 years and hence be an enduring part of the defence force. It might better be referred to as a bridging capability, much like the F/A-18F Super Hornet's introduction to manage the risks in the capability transition from the F/A-18A/B and F-111 fleets to the F-35A. Yet, the Super Hornet has proven its value and looks set to remain in service for a long time to come, well beyond the bridging period and delivery of the F-35A. So the simple term "new conventional submarine" may help avoid potentially erroneous assumptions about the transitory nature of their service.
Whether we need to go down the path of a new conventional submarine will depend on a range of factors that need to be carefully weighed considering the enormous cost of such a move and the key strategic role submarines undertake for Australia. Having a clear understanding of what problem we are trying to solve will help answer whether such a move makes sense and what the most suitable approach to a new conventional submarine might be.
In our next article, we'll look at the risks the government needs to address in the submarine transition and assess whether a new conventional submarine can achieve that.
Co-written with Andrew Nicholls, a former director in KPMG Australia's Finance Strategy and Performance Division and a former senior official in the Australian Department of Defence.
