Senate Foreign Affairs, Defence and Trade Legislation Committee, , 2:34:46 to 2:39:02
Following a break, the committee examines $2.5 billion in savings achieved through reprofiling infrastructure and logistics projects, questioning how much funding is pushed beyond the 10-year window.
Topics: Government spending, Infrastructure, ADF
Speakers: James Paterson, Robert Chipman, Raff Ciccone, Unknown Speaker, Meghan Quinn
Is my microphone on? Yes, it is. All right. U could everyone just take their seats, please? Thank you. >> All right. Uh Senator Paterson, I think you were just in continuation.
>> Thank you. And I apologize VCD if you are getting up and sitting down frequently this morning uh at my instigation. I apologize. But I just want to finish off that line of questioning from before on that $2.5 billion of identified savings in infrastructure, logistics, etc., etc. Um, could you take me through uh and itemize those $2.5 billion of savings?
Air >> Marshall Rob Chipman, Vice Chief of the Defense Force. Uh, Senator, we have not provided that level of detail for the 2.5. What I can say is that they go to infrastructure, estate, and logistics projects that we had programmed in 2024. The 2026 IIP did announce investments in the logistics and health of up to 21 billion. It also announced investments in northern bases of up to$16 billion. We are not talking about divestments or cuts. We are talking about a reprofiling of up to $2.5 billion over the forward estimates against a program of delivery in the IRP that's about $37 billion. All of these projects will continue to deliver. They are all still live projects in our investment program. We have simply reprofiled the budget profile for them so that we can prioritize towards capabilities that we assess we need sooner.
>> Okay. So just to be really clear, this is the 2.5 over 10 years, right?
>> That's correct. Oh, sorry. It's 2.5 over the Ford estimates.
>> Okay. So if it's 2.5 over the Ford estimates and it is being reprofiled, it is being reprofiled out of the Ford
rep-profiled out of the Ford estimates. Some of it might spill beyond the life of the IIP, but it is still programmed in our investment portfolio.
>> Okay. What proportion of it has been pushed into the midterm? And what proportion of it has been pushed beyond the midterm?
>> I'd have to take that on notice, Senator.
>> Okay. Can you give me a kind of rough quantum? I won't hold you to it. Is the majority within the 10 years? Is a majority outside the 10 years?
>> The the sorts of delays that we were talking about were up to two years. most of these projects would deliver within an 8-year period. So, it would be my assessment, but but an unverified assessment that most of them will still be delivered in the life of the IP.
>> Okay. So, I won't hold you to that if it's, you know, slightly different on notice, but I do look forward to that detail on notice. So if it's a 2 if it's the 2.5 which is being saved in the forwards but predominantly will still be delivered within the IIP within the 10-year period. How is it freeing up spending within the IIP? If it's just moved from the forwards to the the medium-term still going to be spent in the medium term. How can you rep prioritize it to other projects? It
>> it is money that we had programmed to spend over the forward estimates. By choosing to delay that expenditure, you're creating the opportunity to direct funds to other higher priorities.
>> Right? So, we can count it towards the $5 billion save in the forwards, but we're not really counting it or not most of it towards the $10 billion save over the medium-term.
>> That would be correct, Senator.
>> Yeah. So, that means that $10 billion save has to come from other areas.
>> There would be. So the the $10 billion it maps out across the life of the IP from the same projects that we identifying savings from the forward estimates. So to the extent that there are there would be some savings over the life of the IP, I just can't quantify them for you today.
>> Yeah. But there's $10 billion that we know is saved in the IIP. Yeah. >> If it is predominantly not from this 2.5 because it's just been delayed from the forwards into the medium term, >> where else is that 10 coming from? I I I I'm now confused as to how you get to 10 over the medium term.
>> I I'd have to I don't have that detail. I'm sorry. I'd have to take that on notice.
>> Okay. So, you said before that we have not provided the details of this um rescoping for the 2.5 or the reprofiling for the 2.5. Why not?