Navy's new supply ships will be built overseas; AMWU condemns decision as 'insidious'

Updated

Two new Navy supply ships will be built overseas, sparking a political fight over the Federal Government's commitment to local manufacturing.

The Federal Government says Spain's Navantia and South Korea's Daewoo will compete for the tenders to replace HMAS Success and HMAS Sirius.

Defence Minister David Johnston says putting the jobs out to tender is the only way the Government can ensure the ships are built quickly enough.

The Australian Manufacturing Workers Union (AMWU) has condemned the decision to offshore the shipbuilding, describing it as "insidious".

"We should be giving preference to Australian manufacturers," the AMWU's Glen Thompson said in a statement.

"Offshoring is an insidious move that undercuts the works of Australian shipbuilders."

However, the union has welcomed the Government's decision to build 20 new Pacific Class patrol boats at home.

Senator Johnston says he wants the local industry to build the next fleet of frigates and has allocated $78.2 million for design work.

But he says he will send the work offshore if the local industry does not lift its game.

"No responsible government could consider providing further work to an industry that is performing so poorly," Senator Johnston said.

"This is not a blank cheque."

Earlier this week the minister placed the Air Warfare Destroyer project on the "Projects of Concern" list.

In 2007 the then-government contracted ASC and Raytheon to build three new Air Warfare Destroyers.

They were due for delivery in June 2017 but are running at least two years late and $300 million over budget.

Opposition Leader Bill Shorten says the Government has "torpedoed" thousands of Australian defence industry jobs.

"We have a reckless decision which puts our shipbuilding capacity at risk in the future and our defence capability, this did not need to occur," he said.

"Today thousands of Australian shipbuilding jobs have been torpedoed by the Australian Government."

Topics: navy, defence-forces, defence-and-national-security, defence-and-aerospace-industries, government-and-politics, federal-government, australia

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