Australian taxpayers will spend $24 million helping three overseas bidders state their case to build the Australian Navy's next generation of submarines.

The Defence Department has confirmed the Japanese government, French firm DCNS and German shipbuilder TKMS will each receive $8 million to provide "defined deliverables" under the Federal Government's so-called "competitive evaluation process".

All three foreign bidders have been asked to consider building the fleet of submarines offshore, in Australia, or a combination of both.

It is not unusual for governments to compensate private firms for the cost of preparing complex tenders.

But South Australian Treasurer Tom Koutsantonis said he is concerned Australian taxpayers will end up subsidising Japan to take Australian jobs.

"Mr Abbott made a promise to build 12 submarines in South Australia. We expect him to keep that promise and honour that promise," Mr Koutsantonis said.

"If he's funding Japanese tenderers to win a tender to build submarines in Japan, quite frankly every South Australian, indeed every Australian would be angry."

The South Australian Government and industry groups have previously expressed concerns the Federal Government is leaning towards a Japanese build.

Defence Minister Kevin Andrews last week appointed an expert advisory panel to oversee the competitive evaluation process which is due to conclude by the end of this year.

Federal Cabinet is expected to make a final decision on the submarine contract early next year.