Submarine shift puts thousands of jobs at risk: unions

The nation’s peak union body has lashed the federal government’s decision to dump a $90 billion submarine contract with France and instead build a nuclear-propelled fleet, warning it has put thousands of jobs at risk.

The Australian Council of Trade Unions said the new AUKUS agreement with the United States and Britain robbed Australia’s shipbuilding and manufacturing communities of “decent jobs for generations to come”.

Australia’s new submarines based on US tech may not be in operation until the 2040s.

The position puts the union movement at odds with federal Labor, which has largely backed the move despite raising some concerns about Australia compromising its sovereignty.

In a letter to Prime Minister Scott Morrison, ACTU assistant secretary Scott Connolly and Australian Manufacturing Workers’ Union assistant national secretary Glenn Thompson said the announcement of the agreement earlier this month “understated both the challenge and scale of change required”.

They also raised concerns the arrangement with the US and Britain lacked “the Australian content commitments of the previous contract” with France.

The agreement with French company Naval Group included an agreement that work worth at least 60 per cent of the contract’s value would be done in Australia. The new arrangement is unlikely to involve as much local work because the nuclear-enriched reactors will arrive fully built.

American defence giant Lockheed Martin, which was to have built the combat systems for the French submarines, has already issued termination letters to its subcontractors.

While the nuclear option will deliver Australia considerable advantages in weapons storage, speed and endurance, the first of the submarines may not be in the water until 2040 – six years later than the first French boat was scheduled to be built.

“We are disappointed with the ‘abrupt and brutal’ termination of Naval Group Australia’s (NGA) contract with the government, which has put thousands of jobs at risk. This decision is an ‘act of betrayal’ and robs Australia’s shipbuilding and manufacturing communities of decent jobs for generations to come,” Mr Connolly and Mr Thompson said.

“While we understand that negotiations with the US and UK were carried out in secrecy for national security reasons, it is disappointing that an agreement which had involved so much effort by so many, and on which many of our members were depending for future work, was scrapped with no warning or consultation with the representatives of the affected workers.”

They said there was an “alarming” lack of detail available about the new arrangement and its impact on the naval shipbuilding workforce and industry.

The union leaders called on Mr Morrison to immediately consult with them on a “strategy to make sure we do not outsource the nation’s defence capability at the expense of Australian shipbuilding manufacturing jobs”.

At a minimum, the government should set up a nuclear-powered submarine task force that included trade union representatives, they said.

Michael Shoebridge, director of the defence program at the Australian Strategic Policy Institute, said it should be remembered that Naval Group and the Department of Defence resisted putting out targets for local content “until quite late in the piece”.

“How much Australian content was actually going to be in the submarine program, as run by Defence with Naval Group, is still an open question, so we shouldn’t be nostalgic about that,” he said. "You don't buy nuclear submarines because you want Aussie jobs. You buy nuclear submarines because you want submarine security.

“The risks in getting a nuclear submarine are higher than a conventional submarine, so the risks should be reduced as much as possible in the build of the submarine.”

Finance Minister Simon Birmingham said on Monday the work to extend the life of Australia’s existing Collins-class submarine fleet and upgrade the weapons capabilities of its air warfare destroyers would create more jobs in Adelaide and across the defence industry generally.

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