Transcripts → 2018


Doorstop - Osborne Shipyards, South Australia

Senator the Hon. Mathias Cormann
Minister for Finance
Leader of the Government in the Senate
Senator for Western Australia

Senator the Hon. Marise Payne
Minister for Defence
Senator for New South Wales

The Hon. Malcolm Turnbull MP
Prime Minister
Federal Member for Wentworth

The Hon. Christopher Pyne MP
Minister for Defence Industry
Federal Member for Sturt


Date: Friday, 29 June 2018

Future Frigates; Naval shipbuilding plan; Witness K charges; SA Senate ticket; Business tax cuts

PRIME MINISTER:This is a great day. A great day for Australia's security. This is the day we announce our commitment, our partnership with BAE to build the nine future frigates. This $35 billion program is one that has been the result of so much hard work and it is going to secure the future of ASC, not just for another year or another ship, but for generations to come.

This together with our submarines, our OPV’s, is the beginning of the foundation of a truly sovereign national Australian shipbuilding industry.

This is what we're working for. We're working for Australia's security, Australia's prosperity, the economic growth that Australians deserve and the security which is the foundation of it all.

So I'm delighted to be here in Osborne and I'm here with the Premier of South Australia, Steven Marshall, the Minister for Defence, Marise Payne, the Minister for Defence Industry, South Australia's own Christopher Pyne, the Minister for Finance Mathias Cormann, who’s going to talk to us about the way in which this deal with BAE is going to secure the future of ASC, not just for this project, which of course is decades long, but right into the future as a sovereign, Australian owned, shipbuilding company with all of the IP and expertise and know-how that involves.

We’re also joined by Simon Birmingham, the Minister for Education and South Australian Senator, Senator David Fawcett, who is also somebody who has provided an enormous contribution to our work on our defence industry plan. Nicolle Flint, the Member for Boothby and of course Georgina Downer, who is our candidate for Mayo.

Of course the CDF, Air Chief Marshal Mark Binskin. The Chief of Navy, Vice Admiral Tim Barrett, Gabby Costigan, the CEO of BAE Systems Australia. Nigel Stewart, the SEA 5000 program director, Menna Rawlings, the very happy British High Commissioner and of course we have Kim Gillis, who is the Deputy Secretary of the Capability Acquisition and Sustainment Group of the Department of Defence, which is a long way of saying that Kim has put in the hard yards with so many others in bringing this deal together.

So I want to thank you all for being here and thank you for your work.

Now what we are doing here is announcing our commitment to build the new nine future frigates. The Hunter class frigates will be the most advanced anti-submarine warships in the world.

It's based on BAE’s Global Combat Ship design and these ships will be built right here in Adelaide with Australian workers and Australian steel by ASC shipbuilding.

The decision is the culmination of the Government's commitment to create this national naval shipbuilding enterprise to deliver the ships the Royal Australian Navy needs to keep our nation safe and secure.

We are in a world with heightened risks. We need to have the capabilities to defend Australia regardless of what may come. But we also need to have the capabilities to build those ships, to build all of the resources and capabilities our armed forces need in Australia.

So far as we can, we are going to ensure that every dollar that is spent, every job that is created, so far as we can do that, is going to be done here in Australia.

This is a national enterprise. It's an $89 billion continuous shipbuilding plan. The 21 Pacific patrol boats underway, the 12 offshore patrol vessels, the 12 future submarines and now of course the nine future frigates, Hunter class frigates.

It’s the greatest modernisation of our Navy since the Second World War and we’re going to spend $200 billion on defence procurement over the next decade.

This is the largest investment in peacetime by an Australian Government in defence capability.

Now I want to say something about what this means for jobs and what it means for industry.

We know that there are going to be 4,000 jobs for this project alone; 1,500 direct here in Osborne, 2,500 through the supply chain around Australia. Overall the shipbuilding plan will have 15,000 jobs created, again around 5,000 directly here in South Australia and the rest throughout the country.

But it goes much further than that because these are jobs that are at the cutting edge in every respect and not just at the lathes. Cutting edge in every respect of technology and advanced manufacturing. This will create a broader and wider ecosystem of technology here in South Australia and around the nation. Because you will see over the years that come, the jobs of the future are going to be created here, building these ships and submarines and OPV’s. But also you will have all the spinoffs, all of the benefits from that. People will come and work here on the frigates for years and then go and start their own business and develop their own products and their own technologies.

This is creating an advanced manufacturing technology ecosystem here.

It is going to be a vital foundation in our commitment to more jobs, more highly paid jobs, stronger economic growth.

Every element of our policy, whether it is our tax reforms and tax relief - whether it is our investments in infrastructure, whether it's our investments in defence capabilities - are designed to build a stronger Australian economy, with more jobs, more opportunities and to build the jobs of the 21st century.

So this is a great day. It secures Australia. It secures Australia in the sense of giving the ADF and the Navy the capabilities it needs to keep it safe, but it also creates the jobs, the technology, the opportunities, the enterprise we need to continue to build our strong economy.

So I'm delighted to be here, I'm honoured to be here on this historic day.

Congratulations to BAE. Congratulations to ASC. Congratulations to the Navy and all the team that brought this together.

And I'll now invite the Minister for Defence to address us.

SENATOR THE HON MARISE PAYNE, MINISTER FOR DEFENCE: The Hunter class frigates will give the Royal Australian Navy the highest levels of lethality and deterrence to hunt and kill submarines, to protect our fleets and to protect Australia and our interests.

And Prime Minister, that's what you expect of your Royal Australian Navy.

Thank you very much for your warm words here this morning.

And can I also acknowledge the men and women of the ADF who are here with us this morning. Thank you for what you do to make sure we are able to deliver that protection of Australia and our interests.

Ladies and gentlemen, this is a decision entirely based on capability.

The best capability to equip the Navy in anti-submarine warfare, with range and endurance, able to operate independently or as part of a task group and to contribute as well in humanitarian assistance and disaster relief and other non-warfare roles.

They will be 150 metres long, 8,800 tonnes in weight, with a top speed of over 27 knots and 180 men and women of the Royal Australian Navy as their ship's company.

The Hunter class will be equipped with the world-leading Australian CEA phased array radar, the Aegis combat management system and an interface developed by SAAB Australia as part of our enterprise approach.

As well as the investment in the vessels, we are also investing in infrastructure and making sure that where we are building the vessels, where we are using the vessels is equipped and fit for purpose as well.

$130 million here at Osborne for the land-based test facility and at Henderson, at HMAS Sterling, $670 million dollars for the Ship Zero training school for the Hunter class.

The Prime Minister’s quite right, when we released the Defence White Paper together in February of 2016, we set the Government and we set the Australian Defence organisation on a path; a path to ensure that based on our capability needs, we made the best decisions in relation to procurement of key aspects of naval capability.

And this is the culmination in those steps of securing that capability.

I want to acknowledge the Prime Minister's leadership in bringing us here today and thank him very much for the faith and support that he has placed in the Australian Defence Organisation, the ADF, and in this case the Royal Australian Navy.

I particularly want to acknowledge the leadership of the Chief of the Defence Force and the Chief of Navy.

These are long and arduous processes of examination, evaluation and selection. They've been supported in those activities and led by the Deputy Secretary of our capability and acquisition and sustainment group, Kim Gillis, and their teams.

We have ensured that the decision we make, the decision that we announce today, equips the Navy with the capability it needs to protect Australia and our interests and to do the job that the Australian people expect of it.

THE HON CHRISTOPHER PYNE MP, MINISTER FOR DEFENCE INDUSTRY: Thank you very much Marise, and Prime Minister Turnbull.

I'd also like to acknowledge my parliamentary colleague Tony Pasin, who's here this morning and also the Chairman of ASC, Bruce Carter and Stuart Whiley, the CEO of ASC, which has waited patiently along with a lot of us for this final shoe to fall in the Government's continuous naval shipbuilding.

And that's what it is. We have already, in the Turnbull Government, set about establishing for the first time in Australia's history a continuous naval ship-build.

As the Prime Minister pointed out with the Pacific Patrol Boats, the offshore patrol vessels, these frigates and now of course the submarines as well, we for the first time will have a shipbuilding and submarine building capability that will last 100 years.

We should make no mistake, what the Turnbull Government has done for industry and defence industry in particular, is quite unprecedented. Marise is absolutely right, our first priority is always capability. But for the first time the Turnbull Government has made its second priority ensuring that out of this enormous spend, this heft of $200 billion, we do the most we can to establish a sophisticated, advanced manufacturing industry in this country.

And building a frigate or an air warfare destroyer, or a submarine is one of the most sophisticated pieces of platform and equipment you can create. And that means the jobs that have been created here, the 1500 on this project alone at ASC Shipbuilding Co, the 2,500 in the global supply chains spread all around Australia, 500 companies have already been qualified by BAE. All of that work flowing into our economy, creating jobs, people spending money in this country, investing in this country and infrastructure.

Right now at Osborne South Shipyard there are 4,500 pilings being driven into the ground. I’m glad they’ve stopped, so we couldn't hear them. They are well on track to do so. That project is on schedule.

Late this year the offshore patrol vessels will cut steel here by ASC group at Osborne.

So we have done the things that have been necessary to bridge that valley of death, that we were left by the previous government.

It's been a major national naval shipbuilding enterprise and we've done it with fantastic teams.

I'd like to thank, not just BAE for the effort that they’ve put into ensuring that we knew the most about their capability, and also setting up a structure that Mathias will talk about that guarantees sovereign capability here in Australia.

But also Fincantieri and Navantia, because it was a very competitive process and that really brought out the best in all the bids. And particularly to Capabilities Acquisition Sustainment Group and Kim Gillis. He’s been part of each of these big project decisions over the last two to three years, as have of course the Chief of Navy and the CDF. We couldn't have done it without the whole team working together, and we couldn't have done it without the commitment of the Turnbull Government to put those funds into Australia in the first place.

So good luck to everyone who is going to work on this project.

It's a very exciting day and it gives us the capability to defend our nation, so every rivet is a bullet.

And that's what all the people who work here at the ASC are doing as part of our national defence.

Thank you very much.

SENATOR THE HON. MATHIAS CORMANN, MINISTER FOR FINANCE: Prime Minister, colleagues, everyone good morning. This is a really exciting day for ASC Shipbuilding. ASC Shipbuilding will build nine Hunter-class frigates here in Adelaide.

ASC Shipbuilding will do this as a subsidiary of BAE Systems during the period of the build, with the Commonwealth retaining a sovereign share. That sovereign share gives us certain rights during the build period in relation to any decisions or actions that have national security or other relevant strategic implications. But it also means that, at the end of the build period, the ASC Shipbuilding entity, with the intellectual property, a highly skilled workforce and all of the associated equipment, returns to Commonwealth ownership.

So at the end of this process what we will have is a significant strategic national asset. We will have a ASC Shipbuilding business which will be in a position to design, to develop and to lead the construction of highly complex naval warfare shipbuilding projects.

That is one of the most exciting aspects of this decision here today from my point of view as the shareholder Minister for ASC. From a national point of view, this delivers a genuine national naval shipbuilding sovereign capability which is very exciting.

Thank you. 

THE HON. STEVEN MARSHALL MP, PREMIER OF SOUTH AUSTRALIA: I’s just going to say a few words and tell you I will not be able to wipe the smile off my face. This is a great day for the people of South Australia. I just want to say thank you very much to the Prime Minister and the Cabinet for this extraordinary vote of confidence in the men and women of the ASC and the people of South Australia, trusting us with this very important task, a $35 billion task to build these nine Future Frigates for our nation. This is a very happy day for our state.

I want to congratulate Gabby Costigan from BAE. She's also a very happy person at this time. This is a big win for BAE but most importantly, I think the big winner is the people of South Australia. So, a massive congratulations.

Our important task is to now get on and create the skills that we need in this state, to deliver these projects. This is why the state government has already announced that we will invest in excess of $200 million over the next four years to create in excess of 20,000 new apprenticeships and traineeships.

We're going to need these technical skills so that we can deliver on this enormous opportunity that we have.

To the men and women of ASC this must be a great announcement for you. Some relief and confidence that the Government of Australia has shown in our capability, our capability here in Australia and most importantly here in South Australia. A great day, please enjoy it.

AIR CHIEF MARSHAL MARK BINSKIN AC, CHIEF OF THE DEFENCE FORCE: Prime Minister thank you and thank you to all the Ministers. Today is a very important milestone, not only for the Royal Australian Navy, not only for the Australian Defence Force, but for Australia as a whole.

The Hunter class frigate, the Hunter class anti-submarine warfare frigate, is the next generation. It’s a new generation of ships, it’s a new generation capability for the Royal Australian Navy. It’ll allow our sailors to get out and fight and win in an ever increasing, complex environment that is the maritime environment around Australia.

A lot’s been done up until now and I'd like to thank those in uniform, those from the Australian Public Service and other departments who have worked with us to be able to get to this point. In particular the Department of Finance, there’s a lot of complexities in what we’ve brought together today, that could only be done as a part of a team. But the way I look at it, today is ‘Day Zero’ of the future. We need to now work together across BAE, across ASC and the ADO and other departments to be able to bring this together as a national enterprise.

I look forward to working with you with BAE, with ASC and looking forward to seeing a ship come to fruition in the future. Thank you.

VICE ADMIRAL TIM BARRETT AO, CSC, RAN, CHIEF OF NAVY: Thank you Prime Minister, thank you all and I’ll be brief.

This is the right capability for the Navy, for the ADF and also for the nation. Can I say to the workers here and those that will work in this program in the future; build these ships well. Our sailors expect and deserve nothing less.

Can I also acknowledge that this is the start of a continuous shipbuilding program that will serve this nation for decades. It's not just about these nine ships. It's about our future, decades ahead. Can I also say, now we have certainty. A decision has been made. For those that work directly for me, let's get on with it. Thank you.

GABBY COSTIGAN, CEO, BAE SYSTEMS AUSTRALIA: Prime Minister, Ministers, CDF, Chief of Navy, Her Excellency Menna Rawlings, as everyone has said before me, this is an incredibly exciting day for Australia. It's a really exciting moment for BAE Systems.

BAE Systems has been in Australia for 65 years, supporting the ADF to protect generations of Australians. Today is an important milestone in our ongoing commitment to the nation.

Our plan is to deliver a defence program the likes of which Australia has never seen before. BAE systems will provide Australia with the world's newest and most advanced anti-submarine warfare frigate, aptly named the Hunter class. That will be absolutely critical to defending the nation for decades into the future.

We will create a continuous naval shipbuilding industry that will create and sustain around 4,000 jobs including more than 1,000 graduate positions and apprentices. This will be a long-term economic opportunity for Australia. The opportunities this program offers Australian industry are huge and today as mentioned before, we have pre-qualified over 500 Australian suppliers. That is just the tip of the iceberg.

We welcome the Commonwealth Government's announcement that ASC shipbuilding will become a subsidiary of BAE systems. Through BAE Systems, ASC shipbuilding will be responsible for the delivery of the global combat ship ‘Australia’. This program will provide opportunities for Australian companies in every state and territory, including indigenous defence companies that we will help to grow and support. We are going to bring the world's best technology, skills and expertise to create a world-class Australian naval shipbuilding industry. The best capability, built here in Australia, by Australians using Australian steel.

This is a once in a generation opportunity and something that I am thrilled that BAE systems will be delivering for Australia.

I would like to sincerely thank the Prime Minister, Ministers Payne and Pyne, Payne and Pyne, for their steadfast commitment to the defence industry. It is this vision and commitment that will not only help protect the nation, but will work to benefit the Australian economy for years to come. I would also like to congratulate the Chief of Navy and the Chief of Defence Force for their incredible service to our nation. We at BAE wish you the best of luck in your next journey. Finally I would like to thank the team at BAE systems. As a former serving officer of the Australian Army and now the Chief Executive of this great company, I am very proud of the work that we do for the Australian Defence Force every day and we will continue to do for many years to come. Ladies and gentlemen, thank you, Prime Minister, thank you.

PRIME MINISTER: Well Gabby and all the other speakers, thank you so much. Now we have a few questions I imagine.

JOURNALIST: Prime Minister how many indirect jobs is this going to create around the country and where are they and what are those jobs doing?

PRIME MINISTER: Well for this particular project it’s estimated there will be 1,500 direct jobs here and 2,500 - so 4,000 in total - around the country. There are over 500 firms that Gabby, her company has pre-qualified. Obviously some of those will be in South Australia but many of them will be all around the nation. Tasmania, Western Australia, Queensland, New South Wales, Victoria, the whole nation. It's a big, this is a big national enterprise. It will have, as the other projects will have, a national supply chain. Christopher do you want to add to that?

MINISTER FOR DEFENCE INDUSTRY: Sure. It's not so easy actually, just to have a very definitive answer about one project. The naval shipbuilding enterprise includes the Offshore Patrol Vessels, the Pacific Patrol Boats, the Future Frigates, now the Hunter class, and of course the submarines.

So here in South Australia there'll be 400 jobs associated with the Offshore Patrol Vessels alone. 600 jobs in the build of the Osborne south shipyard and we’ve created 200 positions, 100 scholarships and 100 people being redeployed to the ASC sustainment and maintenance for the Collins class submarine. Then of course this project, there’s 1,500 direct jobs here at Osborne and 2,500 in the supply chain in South Australia and around Australia. We'll give you a map if you like, of the country, because it shows the break down of companies. About 100 here in South Australia, 163 in Victoria, about 80 in Western Australia and so forth all around the nation. Then of course with the submarines there's 2,500 direct jobs here at Osborne. We haven't even yet tried to say how many indirect jobs there will be, because that project starts in about 2022.

So thousands and thousands of new jobs being created and that doesn't take into account all the flow on, up to a factor of say four, for the hairdressers and cafe owners and teachers who will be working in the schools, looking after the families, which we haven't even tried to tabulate.

JOURNALIST: Is this, I mean these ships only exist on paper, is this a risky deal?

PRIME MINISTER: Well thank you for that question. This is the best ship for our purposes. This is the quietest, the stealthiest ship. But why don't I ask Vice Admiral Barrett to provide a more expert appraisal?

CHIEF OF NAVY: Thank you for the question. The evaluation was quite stringent and strict against the requirements that we had. By the time that the first of these are built, there will already be four other hulls in the water. But it has also been designed and is being built by a nation which has, on a regular basis in the North Atlantic and elsewhere, been chasing submarines as a matter of course on a day by day proposition.

It's not as if the British Government and BAE do not know how to build an ASW frigate. But we've evaluated and we've studied extensively how they intend to do it and we believe - and I spoke as recently as last night to the First Sea Lord, my equivalent in the Royal Navy – and I am assured by his comments, of just how far and how successful this platform will be as the world's most advanced ASW frigate.

JOURNALIST: Prime Minister, just back onto that point, Australia's longstanding relationship with the United Kingdom was that a factor at play here, when this decision was made?

PRIME MINISTER: Well the answer is that the assessment of the tenders was made based on the capabilities. But obviously we are very pleased to be able to enter into this partnership with BAE. The UK is one of our closest friends, allies, partners, family in every respect and I was very pleased to discuss our decision with Theresa May last night in fact.

So yes, that is a very important part of the decision. But let me just reinforce the point the Chief of Navy made. The decision was made to choose the best ship to do the task at hand, which is anti-submarine warfare and to do so in a way which keeps our sailors as safe as possible in the circumstances which they will find themselves in.

So this is the best ship for all of those purposes.

JOURNALIST: Prime Minister, is there any bearing in the fact that you are now standing next to a state Liberal Premier and if anyone is questioning the timing of this?

PRIME MINISTER: Oh look, I cannot tell you, I cannot tell you how pleased I am to be standing with Steven Marshall.

As I have said elsewhere, as Prime Minister I often write letters to the Premiers, you know, a stack of letters and when I get to the one addressed to the Premier of South Australia, my pen lingers for a little longer. It’s just, I'm still getting used to the joy of having Steven Marshall as Premier of South Australia. I mean look, Steven Marshall is what this state needs. Steven Marshall is a businessman. He is optimistic, he’s enterprising. He is confident. He's a glass half-full person. He wants to make this state even greater and better than it is today. He has high hopes and high ambitions. He’s an innovator. He has all of the values that you need to forge ahead.

So I'm delighted that he is here with us today. But I have to say the timetable for this decision was set quite a long time ago. So it’s an added bonus to have Steven here.

So next? Anything else?

JOURNALIST: Prime Minister, you said that these ships will be built with Australian steel, but as I understand it there’s no steelmaker in Australia that has the capabilities to make it with Australian steel.

PRIME MINISTER: No that's not correct, we do have the capabilities in steelmaking. Yes in fact, just as a point of  information, some of the most capable, technically advanced steel in the world, for ballistic purposes, anti-ballistic purposes, is actually made in Australia. So some of the finest steel in the world is made in Australia. We have the capability, certainly to make the steel for these vessels.

JOURNALIST: So it could have 100 per cent Australian steel?

PRIME MINISTER: Yeah, absolutely.

JOURNALIST: [Inaudible]

PRIME MINISTER: I’ll ask Christopher to respond to that.

MINISTER FOR DEFENCE INDUSTRY: Thank you Stacey. The bid makes it very clear that the local build will be at least 65-70 percent local, in Australia, and of course a lot of that will be here in South Australia. A local build is usually defined as being around 60 percent. So that's well above the definition of a local build, which is excellent news. Of course with the Collins class we are now achieving about 82 percent local build. The Air Warfare Destroyer was around 60 percent. So the local build side of the equation is well taken care of.

In terms of the schedule, we are on schedule. We said we would announce the decision in mid-year and June in the Gregorian calendar is mid-year. As a consequence I certainly think we can tick that box. The same has been the case of course with the offshore patrol vessels and the submarines.

JOURNALIST: Prime Minister, on another issue. Were you consulted about the Attorney-General’s decision to sign off on charges against Witness K?

PRIME MINISTER: Just before we move on to that, have we are finished on ships? Tory! There you are, you’re standing behind a very tall photographer.


JOURNALIST: Can I just ask about the ASC decision given that the original tender said they didn’t necessarily have to be included and then obviously there was a push to get Australian shipbuilders on board. What changed?

PRIME MINISTER: Well nothing has changed, but the point is that we want to ensure that we have through these programs and these big investments, a national Australian sovereign shipbuilding industry. You see, the way this will work - as Gabby and Mathias were describing - is that BAE will take responsibility for ASC, they will take responsibility for the project because they’re the prime, they’ll build the ships and at the end of the project, the Commonwealth will resume ownership of ASC.

So what that means is, that you will have then, at the end of this project which is decades long, you will then have an Australian shipbuilding company, ASC, which will have built nine of the most advanced warships in the world, with all of the skills and expertise and IP and staff, workers. And that of course becomes then the basis, as part of our national shipbuilding, our sovereign industry.

MINISTER FOR FINANCE: So it is ASC Shipbuilding that will be a subsidiary of BAE Systems during the period of the build. The reason we are doing this is to ensure that BAE Systems is fully responsible and accountable for the delivery of this program, on time and on budget. Nothing changes for ASC Group. The ASC Group and of course the work in relation to the Offshore Patrol Vessels and the Air Warfare Destroyer continues as before. The Collins class submarine maintenance activities continue as per before.

The ASC Group is not precluded from pursuing future shipbuilding opportunities as well. The announcement today and the structural announcement we have made today is specific in relation to ASC Shipbuilding, which will be transferred as a subsidiary to BAE Systems, just for the period of the build.

As the Prime Minister has said, at the end of this process we will have a significant, strategic national asset in ASC Shipbuilding, with the capability to design, develop and lead the construction of highly complex naval warfare ships.

PRIME MINISTER: Yeah, Christopher is going to add something.

MINISTER FOR DEFENCE INDUSTRY: Just on the issue of the tender. It’s quite a misunderstanding to suggest that Australian shipbuilders were excluded from the tender. Because of the Air Warfare Destroyer alliance structure where Navantia was not included in the initial alliance, we learned from that error of the past and didn't want to repeat it.

We wanted the designer of the ships to be the prime builder of the ships, to ensure that there was accountability and responsibility which was lacking until Navantia was brought back into the Alliance for the Air Warfare Destroyers and we ended up with three excellent vessels. But early on, there was a blowout in that project and it was delayed.

So that is why the tender said that the three bidders would be the designer and the prime in the build. No Australian shipbuilder was ever excluded from being part of this outcome.

JOURNALIST: Will we still see this ebb and flow of job losses, or is it going to be steady from now on?

PRIME MINISTER: Well you've asked about ebb and flow of job losses. The reality is, this is what the Labor Party did to Australia with shipbuilding. They were in government for six years and they did not commission one naval vessel.

So what that meant was that you had projects coming to an end and nothing there to replace it.

It was a shocking abdication of responsibility for our security and for our industrial capacity. A shocking abdication of responsibility.

Now, we've ended that. What we are talking about here is a continuous naval shipbuilding program.

So when the last of these Hunter class frigates is completed and is in the water, serving in the Navy already, there will be underway the design and construction of the ships that will succeed them.

This is going to be a continuous naval shipbuilding industry. The ebb and flow that you talk about, that is absolutely the consequence of a shocking abdication of responsibility by the Labor Party.

I don't want to spoil today's happy occasion with a partisan note, but it's important to tell the truth; they failed to do their duty as the Government of Australia to keep building the ships our Navy needs.

Well, we've got on with the job since we've been in government. And you see that we've made the commitments, whether it's to the Pacific Patrol Boats, the Guardian patrol boats that are being built in Perth, the Offshore Patrol Vessels which will be built here initially and then in Perth, the submarines which will be built here and of course now the Frigates, which will be built here.

That is a commitment to a continuous naval shipbuilding industry. What that means is that people will know, young people will know, that they can get a job in Australia’s shipbuilding industry and they can work in that industry all their lives. And you know what? Their children and grandchildren will be able to do so too if they choose. That is why we call this a great national enterprise.

Do you have one more on the ships?

JOURNALIST: [Inaudible]

CEO, BAE SYSTEMS AUSTRALIA: Thank you for the question. BAE Systems Australia currently has a 3,500 strong workforce. With this fantastic win, an opportunity for the company, here in South Australia we have a workforce of 1,000 employees. Right now, the job starts today, there are 110 working on the campaign at the moment. That will transition to mobilisation. We will see probably an increase of 1,000 employees in the next 12 to 18 months. Then obviously over the life of the program several thousand more.

JOURNALIST: Witness K charges, were you involved in the decision to sign off on those?

PRIME MINISTER: Well firstly I'm not going to comment on the case that is before the courts. Just to let you know what the process was, the Commonwealth Director of Public Prosecutions recommended that charges be laid against the persons referred to. The Attorney-General gave his consent and he advised me that he was considering the matter.

So I was certainly aware that he was giving his consent to it. But it was based, consenting to a prosecution recommended by the DPP.

JOURNALIST: Do you agree with the decision?

PRIME MINISTER: Yes, of course I do. But it is, again, it’s a matter of due process and it's very important that the matter is now before the courts and that the matter be dealt with in accordance with the rule of law.

JOURNALIST: But you’re the Spycatcher lawyer, how does this square with your actions in your previous career?

PRIME MINISTER: Well again, I was asked about this on the radio today so I will just try and be as brief as I can. I will not comment on the proceedings in the courts at the moment relating to the people you’ve referred to. So, I will say nothing about that.

You’ve inquired about the Spycatcher case which was heard in 1986. It was a good year. Probably many of the people here weren’t born at that time, but let me just say that that involved a case where an old MI5 officer had written a book which contained information which was entirely in the public domain. So there was no confidential information. If I may say so, with the benefit of hindsight, Her Majesty's Government in right of the United Kingdom, High Commissioner, might have been better off saying Mr Wright’s book was a load of old cobblers and not bothered trying to restrain it. He certainly would have sold a lot fewer copies.

JOURNALIST: Prime Minister, the former Prime Minister John Howard recently endorsed Lucy Gichuhi as number three on the South Australian Senate ticket behind Senator Ruston and also Senator Fawcett. Is that a sentiment you share?

PRIME MINISTER: I have, I have given Lucy a very strong and glowing reference for her preselection.

JOURNALIST: So you would like to see…

PRIME MINISTER: I have given her a very strong reference yes, yes I have.

JOURNALIST: So you would like to see…

PRIME MINISTER: I have endorsed, I've given a reference supporting all of those Senators.

JOURNALIST: Prime Minister, on the prospect of your company tax cuts, what’s your message to Bill Shorten today?

PRIME MINISTER: Bill Shorten should be ashamed for his assault on small and medium Australian-owned businesses, many of whom are seen in that supply chain of over 500 companies. Many of them. You know, there are companies, he is going after, he is assaulting family-owned businesses wanting to put their taxes. These are businesses that collectively employ more than half of all of the private sector workforce in Australia.

Businesses with turnovers up to $50 million a year, they’re in every electorate. Every single electorate, every community, every town. These are businesses in every area. They’re in engineering, they’re in hospitality, they’re in technology, they’re in fashion. Take your pick.

Right across the board this is where nearly five million Australians work and these businesses are investing and they’re employing.

That's why we're seeing the highest jobs growth last year that we've ever seen in our history.

What is Shorten’s message to them? His message to them is he wants them to pay more tax.

In a competitive world, he wants them to pay more tax. No wonder they are shocked. No wonder they see this as an assault on them, on their enterprise and on their employees. You know, these are businesses that employ 20, 30, 40, 50, 100, maybe a couple of hundred employees. All of those workers depend on that business, for whom they work, succeeding and getting on and investing. These businesses overwhelmingly fund their expansion by investing their retained earnings.

My colleagues here and in Canberra, we understand small business, we understand business. That’s the background from which so many of us come. We understand that you've got to be prepared to support enterprise, hard work. Our tax plan, our personal income tax reform, the most comprehensive in a generation, which is through the Parliament - Bill Shorten was against that as well. He wants to hit hard working Australian families and make them pay more tax. He thinks that people who are on $90,000 a year are millionaires and should be taxed more.

Now he's going after mum and dad, family-owned businesses, small and medium family businesses. Well they're giving him the answer he deserves. He's assaulting them and he's assaulting the jobs that they're creating.

But thank you all very much. This is a great day for the Navy, a great day for Australia's defence. A great day for Australian jobs and Australian defence industry.

Thank you very much.