Too big to fail? If JP 9102 is no longer fit for purpose, what about Hunter?

At first glance, it may seem strange to compare the government’s recent decision and the logic behind the cancellation of the AU$3–7 billion (US$1.97–5.3 billion) JP 9102 defence satellite communications program and the ongoing Hunter Class frigate program as a little strange.

And to be honest, I agree, at least in part – to pinch a line from Nick Giannopoulos’ and Vince Colosimo’s modern Australian classic film, The Wog Boy: ship, satellite, not the same.

However, here’s the rationale provided by Defence in this case, mainly given “the acceleration in space technologies and evolving threats in space since the project’s commencement, Defence has assessed that a single orbit GEO-based satellite communications system would not meet strategic priorities”.

Explaining the logic behind the decision, Defence explained further, “Instead of a single orbit solution, Defence must instead prioritise a multi-orbit capability increasing resilience for the Australian Defence Force.”

Meanwhile, Deputy Prime Minister and Defence Minister Richard Marles said, when asked, “Well, it’s not a cancellation, it’s really a change of direction in terms of how we deliver the capability for our communications network in Defence. And that’s really a function of the way in which the world has evolved...

“What we need to make sure that we’re doing as we move forward is delivering a communications capability which is more distributed, which is therefore more resilient, and we believe we can do that in this way faster and more cost effective.”

So what does all of this have to do with the AU$45 billion (US$29.6 billion) Hunter Class frigate program?

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Well, the cancellation of JP 9102 has once again raised some questions about the value of Australia’s word when it comes to contracts of significant scale, and the reasoning underpinning such decisions, equally, it raises legitimate questions about the viability of the Hunter Class program.

With three major challenges, isn’t this a logical conclusion to draw?

It is no secret that the Hunter Class program has and continues to face its fair share of detractors and challenges, culminating in a reduction of the order from the original nine hulls to six as part of the government’s Independent Analysis into Navy’s Surface Combatant Fleet announced earlier this year.

Much of the public criticism has emphasised three key factors: cost overruns, the delivery time frame and, of course, the level of armament, speed and range relative to the ship’s size compared to similar allied and adversarial warships.

Beginning with the cost overruns of the Hunter Class frigate program, which, when first announced in 2018, was budgeted to cost at a proposed AU$35 billion (US$22.93 billion), which ultimately grew to be worth the current AU$45 billion figure in what former defence minister Senator Linda Reynolds would describe as “out-turned dollars” in mid-2020.

Adding further concerns about the price proposed for the now fleet of six ships is the revelations by the 2023 Australian National Audit Office (ANAO) audit into the Hunter Class program, which revealed that the program was “experiencing an 18-month delay and additional costs due, in large part, to design immaturity”.

Going further, the ANAO report stated, “At January 2023, the project was forecast to exceed the whole of project budget approved by government by a significant amount ... Defence did not conduct an effective limited tender process for the ship design. The value for money of the three competing designs was not assessed by officials, as the Tender Evaluation Plan (TEP) proposed that government would do so.”

The ANAO report also added, “Thirty-six of the 93 CCPs approved by Defence were price impacting and the cost of the contract has increased by $693.2 million. This represents a 36 per cent increase to the design and productionisation cost of the Hunter Class.”

But wait, the cost issues get worse, even when you’d expect that a reduction in numbers would mean the costs get lower, they get worse!

Indeed, Defence itself has added further questions about the costs, with the department telling Coalition senator Claire Chandler at Senate estimates in early-2024, “an additional AU$19.87 billion (US$13.02 billion) was approved to support construction for the first three ships as well as procurement of other items, including delivery of the support system and initial training that will support the class of six frigates”.

As Dr Marcus Hellyer, head of Research at Strategic Analysis Australia, detailed, “The response doesn’t do the maths, but that makes the total approved budget AU$27.12 billion (US$17.8 billion). That covers the initial design and productionisation, build of the first three ships, facilities and the support system.”

Detailing the implications of this, Hellyer added, “The new AU$19.87 billion covers the build of three ships as well as some program level elements like the support and training system. With no further detail, it’s hard to separate the costs for those elements – unlike US Department of Defense budget documents, our government never releases unit costs in Defence contracts.

“But on 17 June, Defence published a contract amendment with BAE Shipbuilding for Hunter Class frigate design and build worth AU$11.2 billion (US$7.33 billion), which presumably covers the build. But that doesn’t include many of the subsystems on the ships so three complete ships will cost more than that. Let’s somewhat arbitrarily pick a mid-point between the AU$19.87 billion and the AU$11.2 billion and say the three ships themselves cost in the order of AU$15 billion (US$9.8 billion).

Hellyer than said, “Ships 4–6, whenever they are approved, might then appear to be another AU$15 billion. But the Commonwealth government and Defence work in out-turned dollars, i.e., dollars that take inflation into account. Because inflation operates over time, we need to understand the schedule for the Hunter’s build to understand the cost.”

It only gets worse when one considers that we still have the remainder of the next decade and into 2030, if not 2031, before we have the delivery of the first of the Hunter Class, all things going well, with Defence estimating the final costs per unit will be in the realm of AU$3.3–7.5 billion (US$2.2–4.9 billion), making them the most expensive surface combatants in the world, outside of large deck amphibious warfare ships and aircraft carriers.

Hardly seems worth the price right? Well, it gets better...

Well now we know that there is more issues with the delivery time frame, with the ANAO report revealing that at best, the first of the Hunter Class frigates will be delivered to the Royal Australian Navy by mid-2032, up from the original timeline of planned delivery and to begin entering service in “the late-2020s”.

This only becomes more abhorrent a decision when one considers that the pace at which the ships are set to be built and delivered has been seemingly delayed, or at least slowed down by government.

It only becomes more curious that this is the case, despite the hundreds of millions, if not billions, in Australian taxpayer money invested in the Australian Naval Infrastructure (ANI) shipbuilding facilities at Osborne, outside of Adelaide, which are meant to have delivered “the most advanced shipyard in the world”.

Hellyer detailed this, stating, “The other disappointing element in Defence’s response to the question on notice is that significant investment in a new shipyard at Osborne in Adelaide appears to have delivered no benefit whatsoever. The government has touted the shipyard as the most advanced, automated shipyards in the world. That should have led to faster construction, reduced costs and smaller workforce.

“Yet earlier claims by Defence that it would recover schedule once construction started have evaporated. Indeed, previous suggestions that the delivery drumbeat would be around two years have slowed to ‘approximately 2–3 years’. The costs have gone up rather than been reduced. One can only wonder whether any workforce efficiencies have been achieved. When the government’s measure of project success seems to be the number of jobs ‘created’, one is probably right to be sceptical that efficiency is a key project driver.”

Bringing us to the third and final major issue facing the continued viability of the Hunter Class frigate program: the capability itself.

Much has been made about the Hunter Class as a formidable anti-submarine capability, which will deliver a truly transformative theatre-scale, anti-submarine warfare capability, combined with the world-leading CEAFAR phased-array radar system and the Aegis combat system.

Indeed, then prime minister Malcolm Turnbull said the new frigates would “provide our nation with one of the most advanced anti-submarine warships in the world that will underpin our security for decades to come”.

On paper, this seemed like a truly game-changing capability few will be able to claim and even fewer will be able to counter, except, it is becoming increasingly apparent that the material capability is leaving a lot to be desired.

Adding further credibility to the concerns about the capability of the platform is Chief of Navy, Vice Admiral (Ret’d) Dr David Shackleton in a report for ASPI, stating, “There was no justification in the Royal Australian Navy capstone doctrine for acquiring and optimising a frigate for ASW, which it regarded as among the most difficult of naval operations to be conducted and most effectively performed using submarines and aircraft.”

VADM Shackleton further detailed the lack of capability the Hunters as is will deliver, explaining, “With an estimated displacement of 10,000 tonnes, it will be the RAN’s most numerous and largest, but least well-armed, surface combatant.

“Not including deck-mounted launchers, it will have 32 missile cells, which is 16 fewer than the smaller Hobart Class with 48, and 64 less than the USN DDG-51 [a ship slightly smaller than the Hunter] with 96. The Hunter will operate a single helicopter with space to carry a second, versus two for the DDG-51. China’s Type 055 destroyer is about 12,000 tonnes and has 136 cells and two helicopters,” he said.

Compounding this issue is the planned introduction of the Tomahawk cruise missile system, along with the planned integration of the SM-2 (Block IIIC) and SM-6 missiles as part of the nation’s integrated air and missile defence system into the Hunter’s already limited missile capacity.

This means that any Hunter will be left with what amounts to be a token missile capability, unfit for defending the ship itself, let alone contributing in any meaningful way to either an Australian or allied task group defence.

Furthermore, the increase in size of the ship, up from the 8,000+ tonnes of the base Type 26/City Class design has added major challenges for the power generation requirements and thus, significant reductions to the range when operating at high speed as is required to keep pace with US Navy carrier strike groups, for example.

Highlighting this is Andrew Tillett of The Australian Financial Review following the release of an engineer’s report into the Hunter Class, which detailed, “From a platform perspective [the Hunter Class frigate] is substantially heavier than the [Type 26] and has a modified hull form … The additional displacement and draught has materially increased the amount of installed power required to propel the vessel, and this means a corresponding decrease in range.”

This leaves the Royal Australian Navy in a precarious position given the increasing level of peer and near-peer competition coming to characterise the Indo-Pacific and, indeed, the broader global environment, leaving the surface fleet and following the retirement schedule outlined by the government as part of the Independent Analysis into Navy’s Surface Combatant Fleet, its oldest since World War Two.

Hardly an ideal situation to be in as a maritime nation, utterly dependent on the unmolested access to the global and regional maritime commons.

Final thoughts

Given the fact that the Royal Australian Navy will be at the forefront of how the nation engages in the Indo-Pacific and will be the tip of the spear for securing and promoting our national interests, accordingly, getting the force structure and capability mix right is increasingly essential during these competitive and increasingly dangerous times.

The rapidly deteriorating geopolitical and strategic environment that is transforming the global and regional security paradigm requires a realistic analysis and assessment by Australia’s policymakers.

While taking shortcuts to end up with 50 per cent of something, as opposed to 100 per cent of nothing, as proposed by the government is an admirable goal; ultimately, it will only prove more costly in the long run as we scramble to rapidly develop high-end warfighting capability, so perhaps a longer-term vision of the nation’s role and responsibilities both to itself and its partners in the region.

Equally, both the Australian government and the Australian public have to accept and understand that we will need to dramatically increase spending in our national defence and do so over the long term, rather than short-term sugar hits or sleight of hand that push money out over the forward estimates and allow inflation to account for “increases” in spending, despite there being little-to-no new money in real terms.

Ultimately, all of this comes back to the government’s shift away from a “Balanced Force” towards “Focused Force” as championed in the Defence Strategic Review and the foundational problem that is our lack of clearly defined role and objectives for our own defence capabilities and the nation more broadly.

This reality equally fails to account for the planned increase in ADF personnel by 2040 and places ultimate hope in a series of as yet to be developed “wunderwaffe” or wonder weapons, like autonomous systems, cyber or tactical weapons like HIMARs and others that are being shoehorned into fulfilling “strategic” roles to provide both “impactful projection” and deterrence against “any potential adversary”.

Importantly, no one has said that defending the nation in this era of renewed and increasingly capable great power competition will be cheap or easy and we have to accept that uncomfortable reality.

In the second instalment of this short series, we will have a look at efforts underway to get the most out of the Hunter Class program.

Get involved with the discussion and let us know your thoughts on Australia’s future role and position in the Indo-Pacific region and what you would like to see from Australia’s political leaders in terms of partisan and bipartisan agenda setting in the comments section below, or get in touch at This email address is being protected from spambots. You need JavaScript enabled to view it. or at This email address is being protected from spambots. You need JavaScript enabled to view it..