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The Institute of Public Affairs (IPA) and Strategic Analysis Australia (SAA) called for the Commonwealth to increase the Defence budget to 3 per cent of GDP in three years, identifying $48 billion in government savings to be reinvested in Defence.
The findings were put forward in the fourth paper of the IPA and SAA Defence of Australia series, warning that the Australian Defence Force did not provide an effective deterrence to potential adversaries.
Key recommendations laid out in the report include increasing Australia’s Defence budget to 3 per cent of the gross domestic product (GDP) in the next three years, with additional increases moving forward to address the impact of inflation on Defence’s purchasing power.
The report further recommends that Australia deepen collaboration with the incoming US administration to enhance burden sharing between the two nations across expenditure and capability development, while also adopting a US Defence Policy Board model to provide independent advice.
It called for the Department of Defence to be “radically overhauled” to provide accountability.
John Storey, director of law and policy at the Institute of Public Affairs, argued that the changes are necessary to develop credible deterrence.
“The price of deterring war is far better than the alternative. However, Australia’s Defence budget is not sufficient to rebuild capability and arm the nation to provide a credible and effective deterrent from foreign aggression,” he said.
“Lifting Australia’s Defence budget to 3 per cent of GDP in three years will radically transform our defence preparedness. The ‘3 in 3’ goal is feasible and achievable with political commitment and focus.”
In delivering the recommendations, the report identified $48 billion in Commonwealth spending that can be reallocated to Defence.
“Increasing Australia’s Defence budget will also send a strong message to our allies that we are fair dinkum about the security of our nation and our region. This will be particularly important in managing our vital alliance with the United States,” Storey said.
“The best investment in our defence is to ensure the continued trust of our allies, and we must lift our performance as a contributor to global security to get.”
While improving the Defence budget, the IPA and SSA argued that the department must be “held to account for under-delivery” with a new focus on accountability.
“There’s no point spending more on defence if it is not spent well. Australians need to have confidence that their tax dollars are not being wasted by a broken bureaucracy, but rather are delivering an improved Defence Force that will protect them far into the 21st century,” he said.
