Senate Foreign Affairs, Defence and Trade Legislation Committee, , 3:43:01 to 4:45:35
Officials discuss domestic small arms manufacturing at Lithgow and the importance of maintaining sovereign supply chains for critical equipment.
Topics: Manufacturing, Food security, Procurement
Speakers: Tyron Whitten, Chris Deeble AO CSC, Speaker 23, Unknown Speaker, Admiral David Johnston AC RAN, Raff Ciccone
>> Thank you chair. Uh firstly, I'd like to acknowledge and thank the brave men and women that put on a uniform every day and afford us the freedoms that we all enjoy. So, thank you. >> Um I'd like to talk about sovereign capability in Australian manufacturing if that's okay. Um was defense consulted on the impacts or effects of to the supply chain resilience or small arms manufacturing? uh when Labour was drafting the recent
>> Senator Chris Depp of Capability Acquisition and Sustainment Group. I'm not aware of any specific um engagement with defense. Um definitely not in the
We've heard from uh domestic manufacturers who are concerned that their suppliers of parts for their firearms that didn't previously require a license to manufacture may be caught under the broad definitions of what cannot be accessed digitally under the new laws. Um has defense considered the possible impacts to suppliers in their supply chains where they may no longer be able to manufacture firearms components?
>> Yeah, Senator E. Marshall Leon Phillips, chief of guided weapons and explosive ordinance. I'm not aware of the legislation changes you're talking about. If you could provide more information, we might be able to better answer the question. It's not been brought to my attention that there are restrictions that would preclude manufacturer to support uh the ADF.
>> Okay, I'd be happy to >> Yep. Thank you. >> introduces some people. Thank you. Um so I understand that thales outsources components of their firearm manufacturer to other businesses. Um as a major defense supplier could they be impacted and has there been any communications in that regard?
>> Uh we deal with tallies as a strategic um a partner of ours. Um they run our governmentowned uh facility at M Benella and Malweila. they produce other um weapons for us as well that they've not raised these concerns with me specifically Senator but we'll make inquiries
>> and Senator Talis also provide and CASG supports the small arms manufacturer at the Lithgo facility and I haven't heard anything being raised by Talis or the supply chain in that regard.
Um, so given the domestic demand for firearms and ammunition has been severely depressed in the wake of the new gun laws, and that's what I'm hearing directly from uh the people that are involved. Are you concerned that there will be a loss of domestic supply and manufacturing expertise from Australia? Um, yeah, look, maybe I might put that on notice because and I'm not sure that you've even sort of considered it at this stage. So, I don't want to just keep asking questions that you're not going to be able to answer.
>> Senator, we'd be happy to take that on notice and we'll be able to work with Talis and the suppliers of those weapons with us to consider any of those issues.
Um, is there any plans for the ADF to invest in local manufacturing outside of the current businesses like um um to make sure there's a range of suppliers available for component
>> Uh in in relation to what specific capabilities? Senator, please.
>> Small arms and components. I'm probably
best to answer that question, Senator. Um, we work with a range of suppliers for the weapons requirements under a number of um, army related projects. Uh, we buy the best of the capability for the ADF to um, ensure their lethality. Um, that they've got worldclass weaponry. Um, that means that we will deal with a number of companies that would be able to support us in that regard. Um, sixour for example for the provision of um, pistols. Um we work with a number of providers you know in terms of testing the market and being able to ensure the best most lethal capability um for and safest capability
>> Thank you. Um I know that as part of the puck mutual defense treaty with PNG, Australia will be providing 3,500 automatic rifles to PNG. Has a tender been put out for this supply or is a
through um those 3 and a half thousand um they would be manufactured in the Lithco um facility um that will uh provide ongoing manufacturing of that capability. It's the AAR weapon which is a Talis developed weapon.
>> Okay. So it's not going out to competitive tender. It's just going to be
>> where we'll be using our um facility. This is a sovereign capability that we maintain um supported by Talis um you know who have been um in charge of that facility for a num number of years. They provide the sty weapon and have provided that to the ADF and other component parts for a number of our weapons including mag 58 and others. So the answer is that we'll be working with Talis maintaining that sovereign capability in litho.
>> Okay. I might just one of the objectives of that work we're doing with Papa New Guinea is commonality of supply chains systems. It enables us to integrate better support each other uh when we are in the field with our respective supply chains and uh maintenance and logistics support. So the commonality is actually a core part of how we will make the arrangements with PNGF work well.
>> Yeah. Look, I guess I'm not opposed to uh that supply. Um my questioning is probably more around small Australian manufacturers given that um Tales is not small or Australian. Um
>> Senator, I'm I'm happy to take this on notice. We'll come back and give you a a more definitive um answer with regard to Talis, the work that's undertaken, the supply chains that we tap into, and the alternatives. Thank you.
Um, so it's my understanding that one of the last available forging hammers in the country is held at um, I don't know if I want to say the location or the company, but I can notify that offline. Um, they're capable of forging large bomb casings for warheads and artillery guns. We've heard reports that this business is in trouble and has the ADF uh looked to move any manufacturing to this forge to avoid loss of manufacturing capability if this business closes.
>> Um it's a bit hard to comment Senator on the company if I don't know what it is. But what I will say is that we are looking um and we are still in the middle of the tender process to establish a 155 mm forging capability to provide um to provide 155 shells to the ADF that we're in the middle of the tender process. So I won't comment any more on that. That was a limited tender producing artillery shells and using the steel. That's a that's a particularly high-end complex process and we we do have a couple of companies we are engaging on that front
>> in Australia.
>> In Australia, yeah, that work will be done in Australia.
>> Okay. Look, all I can suggest is if you're not talking to them, please talk to them because they are um
>> All right. Well, if you wanted to provide me some details offline, we'll Thank you. >> would welcome that. Thank you, Senator.
um given that they do have um a a capability that's probably not common, if they did close, is there how would Australia secure the equipment so it doesn't end up in the hands of
>> I I can't comment on the hypotheticals. My apologies and I'm not sure the company you're talking to, so it's hard to speculate.
>> Okay, I might I might send it offline. Given the uh global uncertainties of supply chains, would it be worth uh considering prioritizing defense fastmoving consumables requirements by awarding a local Australian company businesses so we're not relying on foreign suppliers and more disturbingly uh ship owners to keep defense supplied with fuel, food, and
>> Senator. Um supply chain security, supply chain resilience is um a key focus for us. We're looking at this under the defense industry development strategy. Um when that was issued in 24, we were looking at how we strengthen those arrangements under this next defense industry development strategy which will yet to be considered by government. Supply chain resilience will be a critical issue. We're looking at that through a number of lessons um lenses um that will help us better understand what we need to stockpile here in Australia, what we might need to still rely on through more resilient supply chains with overseas providers. If you're looking at some of the component parts, um we don't for example have might have might have the ability to manufacture the metal for barrels. We're looking at all of those uh particular aspects to see what that might mean during conflict and what that might mean in terms of maintaining manufacturing and production capability here in Australia.
>> Yeah, I I just as a comment, I just guess my main concern is there are no Australian flagged um fuel tankers or Australian flagged uh container ships that I'm aware of. Um which could be
>> Understood soon. All right.
>> Thank you, chair. I have another line of questioning, but I'm happy to wait my
turn. >> Yeah, we'll come back after lunch. Okay. Well, on that that note, we're going to break for lunch. I'll see everyone back >> Georgia lunch. Uh we'll now reccommence