Feds 'lukewarm’ on Aus steel: Xenophon

SINKING SHIP: Senator Nick Xenophon has claimed the federal government have a 'lukewarm commitment' to using Australian steel in their Future Submarine Program.
SINKING SHIP: Senator Nick Xenophon has claimed the federal government have a 'lukewarm commitment' to using Australian steel in their Future Submarine Program.

Senator Nick Xenophon has criticised the federal government for what he calls a ‘lukewarm commitment’ to Australian steel in their Future Submarine Program and the transfer of technology by the Department of Defence 

The Joint Standing Committee on Treaties recently held a public inquiry into program, which will see 12 Future Submarines constructed to replace the Royal Australian Navy's Collins-class submarines.

According to Mr Xenophon, when asked about the use of Australian steel in the construction of the submarines, Head of the Future Submarine Program Rear Admiral Greg Sammut responded:

“At the moment we are currently looking at the capacity of the Australian steel producers to produce steel to the very demanding specification that is required for submarine construction.”

Mr Xenophon said he was ‘concerned’ about what he described as a ‘waning enthusiasm’ from the federal government to use Australian steel in the project and how this may affect the Whyalla Steelworks.

“There's no excuse to not be using Australian steel for this project, and for the Whyalla Steelworks to have a significant role in the construction of the submarines.

“It would be a huge boost for Whyalla and Arrium to be involved in what would be a prestigious job...we need to have max Australian steel in this project and max Australian jobs.

 "There has been a lot of talk from the Federal Government about Australian Industry Participation and local jobs, but it appears that it's still just that - talk,” he said.

Mr Xenophon pointed out that the steel used to construct the original Collins Class submarines was made in Australia by Wollongong company Bisalloy Steel.

“Having made the steel for the Collins Class submarines, surely we can do the same for our next generation Shortfin Barracuda submarines,” he said.

“If new skills are required for the French steel, then so be it – that’s the point of the technology transfer program.”

However Member for Grey Rowan Ramsey claimed that there would be ‘plenty’ of Australian steel going into the project.

“Nothing in Admiral Sammut's words suggests Defence is not intent on using Australian steel in the project, assessing capability is a normal and proper way to develop our capacity,” he said.

“Steel will not be required for the Future Submarine Project for at least another decade, but participation in the construction of the surface defence fleet will start well before then and there will plenty of Australian steel going into those projects.

“To allege the Federal Government has ‘waning enthusiasm’ to use Australian steel is simply ridiculous given the more than $120m the Turnbull Government has already invested in Arrium's Whyalla operations.”

Mr Ramsey said it was ‘well-known’ that the Whyalla Steelworks does not make the flat steel used in constructing submarines but ‘hundreds of tonnes’ of Whyalla steel would be used in the construction of new shipbuilding facilities at Osborne.

“However, that being said, who knows what a new owner may wish to invest in and what we may produce in the future?” he said.