Half an insurance policy? AUKUS SSNs more about post-Taiwan than anything else

In many ways, the Albanese government’s Defence Strategic Review has broken the post-Second World War mould of Australian defence and strategic planning.

This shift has seen a departure from the late-Cold War-era Defence of Australia doctrine, which championed continental-focused defence doctrine and ensuing force structure, while not quite being a return to the immediate post-war doctrine of Forward Defence marked by power projection-focused capabilities and an active presence throughout the region.

Underscoring this dramatic shift in national posture are the concepts of “impactful projection” and “national defence”, each forming the central delivery mechanisms of a broader conceptualisation of Australian deterrence in the Indo-Pacific, with the nation’s future fleet of nuclear-powered submarines at the “tip of the spear” of this new deterrence hierarchy.

This leads us to two specific comments, the first from Deputy Prime Minister and Minister for Defence Richard Marles at the release of the Defence Strategic Review, where he explains the definition and theory of “impactful projection”, where he states: “I think, increasingly, we’re going to need to think about our defence force in terms of being able to provide the country with impactful projection, impactful projection, meaning an ability to hold an adversary at risk, much further from our shores, across kind of the full spectrum of proportionate response. Now, that is actually a different mindset to what we’ve probably had before.”

This statement leads perfectly into the second statement, this time from the Defence Strategic Review, shattering the nation’s long-held belief in the unassailable nature of American primacy and its central role as our primary strategic benefactor and security guarantor: “Australia does not have effective defence capabilities relative to higher threat levels. In the present strategic circumstances, this can only be achieved by Australia working with the United States and other key partners in the maintenance of a favourable regional environment. Australia also needs to develop the capability to unilaterally deter any state from offensive military action against Australian forces or territory.”

Despite the rhetoric of both the Defence Minister and the Albanese government’s Defence Strategic Review, one can’t help but wonder, the long lead time for delivery of Australia’s planned nuclear-powered submarine fleet, feels somewhat like half an insurance policy with a longer-term goal in mind.

This only becomes more apparent when set against the backdrop of the largest conventional and strategic build up since the Second World War, with much of the emphasis placed on the rise of the People’s Republic of China and its repeated belligerence towards the island democracy of Taiwan.

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Again, the Defence Strategic Review highlights this new and uncomfortable reality, stating: “Australia’s region, the Indo-Pacific, faces increasing competition that operates on multiple levels – economic, military, strategic and diplomatic – all interwoven and all framed by an intense contest of values and narratives. A large-scale conventional and non-conventional military build-up without strategic reassurance is contributing to the most challenging circumstances in our region for decades. Combined with rising tensions and reduced warning time for conflict, the risks of military escalation or miscalculation are rising. In this environment, we must sharpen our focus on what our interests are, and how to uphold them. Our focus needs to be on: how we ensure our fate is not determined by others; how we ensure our decisions are our own; and how we protect our way of life, our prosperity, our institutions and our economy.”

In the face of this uncomfortable truth is the recognition by policymakers that Australia no longer enjoys the long vaunted “10-year warning time”, which would allow us to prepare accordingly, raising many questions about the Defence Strategic Review and the nation’s defence “insurance policy”, particularly over the short-to-medium term.

Questions remain about urgency, commitment, cost, timeline and mass

It is no secret that Australia’s pursuit of a nuclear-powered submarine fleet has raised many eyebrows, both at home and abroad.

While Beijing’s “concerns” about Australia’s own fleet of nuclear submarines has been well documented, the more interesting concerns are raised closer to home and by both sides of the political aisle, albeit from vastly different angles.

Yet, there are some common threads in the criticisms, particularly around the costs associated with developing and building nuclear-powered submarines and the supporting infrastructure domestically, and critically, the proposed timeline for fielding any serious “mass” as a result of this transformative capability.

Front and centre is The Australian’s Greg Sheridan, who highlights growing concerns about our domestic commitment, coupled with the second order costs associated with the nuclear submarines, where he states, “There’s every chance AUKUS could turn out to be the enemy of Australian defence self-reliance, or of any defence capability at all. Nothing much is happening about AUKUS in the physical universe. We haven’t even seriously begun upgrading the Stirling submarine base in Western Australia that is meant to host nuclear-powered subs by 2027. Worse, it could ultimately go the way of the French submarines. People will lose faith in it because it’s not remotely on track to deliver anything at all in a meaningful time frame.

“Here’s the state of our Defence. The Air Force is modern, has hitting power, but is way too small. The Army is tiny, has almost no hitting power and no concept of operations. The Navy is a colossal mess with no hitting power at all beyond the Collins subs, nothing planned for 10 years and no way forward ... Any nation that acquires nuclear-powered subs needs to spend a lot more money. If it doesn’t radically increase its Defence budget, it can spend that money only by eating up other defence capabilities. We already spend defence dollars staggeringly inefficiently. We’re getting nuclear subs, but we’re not increasing defence spending within these forward estimates, and promises after that are just science fiction,” Sheridan states.

Meanwhile, on the opposite vector of attack is former NSW premier and Australian foreign minister Bob Carr who has launched a number of scathing attacks on the AUKUS with particular emphasis on questions surrounding the capacity of the US to supply Australia’s initial nuclear submarines.

Carr states, “It probably won’t be Joe Biden but his successor who will make the decision whether to sell us Virginia Class subs or preserve them for American’s own order of battle ... The US Navy will then have its lowest number of attack submarines, 46 instead of 66. That’s when the AUKUS deal has the US handing over at least two to Australia.”

This is further reinforced by a rather hyperbolic analysis of the costs, both financially and materially associated with the nation’s future submarine fleet, with Carr stating, “Committing to Morrison’s AUKUS is the most consequential decision of the Albanese government. The Parliamentary Budget Office estimates it will cost $50 billion between 2027 and 2033 alone. Our Navy, already under-resourced, will have to make painful savings. Other defence platforms will be ‘cannibalised’ ... Splintering a bottle of champagne over the snout of an Attack Class French sub in the early 2030s would plainly have been a simpler option with less stress for other Defence assets. The whole fleet would have been a bargain at a trifling $90 billion compared with the half-trillion-dollar price tag for the Loch Ness monster alternative arriving in the 2050s.”

This combination of questions over costs, domestic and international commitment, coupled with timelines in the face of mounting regional tensions only serve to add further questions over this “insurance policy”, but what if there is method to the madness?

Preparing for the post-Taiwan world

OK, maybe not a “method” but perhaps there has been a recognition in Australia’s strategic policy-making circles that a Chinese invasion of Taiwan is not only a foregone conclusion, but the successful invasion will result in the collapse of confidence in the US alliance and its capacity to defend Australia’s interests.

This brings us back to the statement identified in the Albanese government’s Defence Strategic Review which articulated a paradigm-shattering statement that Australia should be capable to “unilaterally deter any state” which will see Australia’s future fleet of nuclear-powered submarines playing a central role.

Ultimately, we can conclude then that Australia’s future nuclear submarine fleet will be at the centre of the nation’s shift in strategic doctrine and largely, will be central to defending the nation’s critical sea lines of communication and interests in the Indo-Pacific should the US capacity to enforce a strategic umbrella in the region collapse.

However, as much of the analysis has highlighted, the costs associated have wide-reaching implications for the broader Australian Defence Forces as all branches struggle to fund capabilities that will deliver a focused force as identified by the Defence Strategic Review.

This begs the question: are we being left with half a national insurance policy?

Final thoughts

Importantly, in this era of renewed competition between autarchy and democracy, this is a conversation that needs to be had in the open with the Australian people, as ultimately, they will be called upon to help implement it, to consent to the direction, and to defend it should diplomacy fail.

Our economic resilience, capacity, and competitiveness will prove equally as critical to the success in the new world power paradigm as that of the United States, the United Kingdom, or Europe, and we need to begin to recognise the opportunities presented before us.

Dr Ross Babbage of US think tank Center for Strategic and Budgetary Assessments reinforces this, saying, “I think what we’ve got to show, what’s the vision for Australia, you know, what can we achieve and what, you know, if we go on the trajectory we are on at the moment. I’ll tell you what, you know, a lot of people, a lot more people in a decade’s time are likely to be either in really dumb jobs or maybe not have jobs at all, and in the society, be a lot weaker and will be a lot less prosperous.

“So what we want to say is, look, there’s plenty of scope for doing more and smarter things, encouraging investment to do that, and then there will be some very, very interesting additional jobs and opportunities, a lot of high tech, and so on, I can tell you that, you know, talking to foreign investors, they’re quite keen on principle to work here, and do a lot more here and provide a lot more good jobs for Australians.”

Expanding and enhancing the opportunities available to Australians while building critical economic resilience, and as a result, deterrence to economic coercion, should be the core focus of the government because only when our economy is strong can we ensure that we can deter aggression towards the nation or our interests.

This also requires a greater degree of transparency and a culture of collaboration between the nation’s strategic policymakers, elected officials and the constituents they represent and serve – equally, this approach will need to entice the Australian public to once again invest in and believe in the future direction of the nation.

Additionally, Australia will need to have an honest conversation about how we view ourselves and what our own ambitions are. Is it reasonable for Australia to position itself as a “middle” or “regional” power in this rapidly evolving geopolitical environment? Equally, if we are going to brand ourselves as such, shouldn’t we aim for the top tier to ensure we get the best deal for ourselves and our future generations?

If we are going to emerge as a prosperous, secure, and free nation in the new era of great power competition, it is clear we will need break the shackles of short-termism and begin to think far more long term, to the benefit of current and future generations of Australians.

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 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..