Federal budget ramps up Aukus with $2.6bn earmarked for submarine project in 2024-25

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Defence says approved spending for Australia’s acquisition of subs so far totals $13.6bn

A Department of Defence report released on Tuesday night also shows the government has so far approved spending of $13.6bn on the project to acquire the submarines, although that figure spans many years.

By 30 June 2024, the government expects to have spent just $456m of that amount, but this will rise significantly after that date. The government estimates it will spend $2.59bn on the project in the 2024-25 financial year. Defence’s portfolio budget statement says the project “includes a fair and proportionate contribution to our Aukus partners’ submarine industrial bases to provide the additional capacity needed to deliver Australia’s conventionally armed nuclear-powered submarines”.

The agency is expected to have 665 staff in 2024-25, before it hires another 200 staff, bringing the average staffing level to 883 in 2025-26. That will see annual funding for the submarine agency rise to $431m. The government has repeatedly acknowledged that workforce shortages will be one of the key challenges to delivering Aukus.

The budget allocates an extra $5.7bn towards defence over the initial four-year budget period, and $50.3bn over the next decade, as announced by Marles last month.Our Australian morning briefing breaks down the key stories of the day, telling you what’s happening and why it mattersWhile the funding is going up overall, the government says it is freeing up about $73bn over 10 years by cutting, delaying or changing the scope of some defence projects.

 

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