Deciding the future: the Australian Army and the infantry fighting vehicle

Introduction

The aim of this report is to inform government decision-makers and the public on the ability of Project LAND 400 Phase 3—the infantry fighting vehicle (IFV) acquisition—to meet the needs of Australia. I examine a number of factors that provide context for the government’s upcoming decision, whenever that may take place. Those include how IFVs fit into the Australian strategic environment, the ease with which the ADF can deploy them, their vulnerability to threats, and the ongoing utility of armour in the light of lessons unfolding from the ongoing Russian–Ukrainian War.

To set the information into a useful context, this report explains the nature of contemporary land warfare and speculates how the Australian Army is likely to fight in a future conflict. To further assist those making the IFV decision, this report offers a number of scenarios that outline potential operations that the government may direct the ADF to undertake. It also identifies current gaps in ADF capability that will need remediation if the IFV is to achieve its potential, as well as the other opportunities that might not be taken up because of the focus on this investment.

The report’s analysis results in some key questions for decision-makers to consider as they decide on the infantry fighting vehicle acquisition:

  1. Does the government believe that its IFV investment will deliver an appropriate balance of protection, lethality and mobility (both tactical and operational)?
  2. Does the government agree with the requirement for an infantry vehicle with STANAG 4569 Level 6 force protection and equipped with an active protection system?
  3. Is the government confident that the number of the IFVs obtained will generate a deployable and sustainable force that represents a sufficient return on the investment?
  4. Does the government accept that the IFV options under consideration will enable the ADF to offset existing gaps in capability and allow it to conduct operations in a contested maritime environment, including sea and airlift, long-range fires and logistics?
  5. Is the government confident that the Army’s combined arms system is deployable in contested environments, particularly in a maritime scenario?
  6. Does the government believe that the IFV will provide utility in the range of contingencies that the government envisages the ADF will need to meet?
  7. Does the government agree that the IFV will contribute to the requirement that the ADF be able to shape, deter and respond to threats as mandated in the 2020 Defence Strategic Update (DSU)?

ASPI AUKUS update 2: September 2022—the one-year anniversary

Introduction

Consistent with a partnership that’s focused on the development of defence and technological capability rather than diplomatic grandstanding,1 there have been few public announcements about the progress of AUKUS. That’s an observation we made in our first AUKUS update in May,2 and one we make again in this latest update, one year on from the joint unveiling of the partnership in mid-September 2021.

Periodic press releases note meetings of the three-country joint steering groups—one of which looks at submarines and the other at advanced capabilities—but provide little hint about what was discussed.3 On Submarines, we shouldn’t expect to hear anything concrete until the 18-month consultation phase concludes in March 2022.

What’s changed, however, is that the strategic environment that gave birth to AUKUS has worsened markedly, most notably in Russia’s invasion of Ukraine and China’s escalating pressure on Taiwan and other parts of the Indo-Pacific. Those developments are making the advanced technologies AUKUS aims to foster even more relevant.

Image: iStockphoto/sameer chogade

While the political landscape across the three AUKUS partners has also changed (of the three leaders that announced AUKUS just one year ago, only one, US President Biden, remains in office), bipartisan support for AUKUS appears to be undiminished in all three capitals.

In Australia, Prime Minister Anthony Albanese’s Labor government has made clear its commitment to AUKUS alongside the announcement of an ambitious Defence Strategic Review (DSR). Albanese has simultaneously worked to restore good relations with France, which temporarily withdrew its ambassador and some forms of cooperation because of the loss of the Attack-class submarine contract and what it said was a lack of Australian sincerity about AUKUS.

Britain’s new Prime Minister, Liz Truss, was a staunch advocate for AUKUS as Foreign Secretary, and all the signs are that she’ll continue in that vein as Prime Minister. Truss has kept Ben Wallace, a strong supporter of AUKUS, as Defence Secretary. Truss’s government has also moved former National Security Adviser Stephen Lovegrove into a new role focused on nuclear defence industry partnerships. If that becomes a permanent position, it could add capacity to deliver AUKUS over the long term.4

This update begins by reviewing the worsening strategic context one year on from the AUKUS announcement. Next, it summarises what more we have learned about progress in the nuclear-powered submarine (SSN) program, which is at the heart of AUKUS. It then assesses how think tanks across a selection of key countries are covering AUKUS to gauge trends in the public debate. The final section of the update assesses the importance of advanced technological cooperation through AUKUS to develop capability and reinforce deterrence rapidly in the face of the strategic challenges we face. The update makes some recommendations for the best way forward.

  1. Michael Shoebridge, What is AUKUS and what is it not?, ASPI, Canberra, 8 December 2021. ↩︎
  2. Marcus Hellyer, Ben Stevens, ASPI AUKUS update 1: May 2022, ASPI, Canberra, 5 May 2022. ↩︎
  3. ‘Readout of AUKUS Joint Steering Group meetings’, The White House, 31 July 2022. ↩︎
  4. ‘Sir Tim Barrow appointed as National Security Adviser’, media release, UK Government, 7 September 2022. ↩︎

The geopolitical implications of Russia’s invasion of Ukraine

The geopolitical implications of Russia’s invasion of Ukraine

Background

The eminent Harvard University professor of Ukrainian history, Serhii Plokhy, observed that Russia’s occupation of Crimea, Donetsk and Luhansk in 2014 raised fundamental questions about Ukraine’s continuing existence as a unified state, its independence as a nation, and the democratic foundations of its political institutions.1 This created a new and dangerous situation not only in Ukraine but also in Europe as a whole. For the first time since the end of World War II, a major European power made war on a weaker neighbour and annexed part of the territory of a sovereign state. This unprovoked Russian aggression against Ukraine threatened the foundations of international order—a threat to which, he said, the EU and most of the world weren’t prepared to respond.

Two years later, Plokhy published a book called Lost kingdom: a history of Russian nationalism from Ivan the Great to Vladimir Putin 2 in which he observed—correctly, in my view—that the question of where Russia begins and ends, and who constitutes the Russian people, has preoccupied Russian thinkers for centuries. He might have added that Russia has no obvious or clear-cut geographical borders. Plokhy also stated that the current Russo-Ukrainian conflict is only the latest turn of Russian policy resulting from the Russian elite’s thinking about itself and its East Slavic neighbours as part of their joint historical and cultural space, and ultimately as the same nation. He asserts that the current conflict reprises many of the themes that have been central to political and cultural relations in the region for the previous five centuries. Those include Russia’s great-power status and influence beyond its borders; the continued relevance of religion, especially Orthodox Christianity, as defined in Russian identity and the conduct of Russian policy abroad; and, last but not least, the importance of language and culture as tools of Russian state policy in the region. Moreover, the conflict reminds the world that the formation of the modern Russian nation is still far from complete. Plokhy concludes that this threat is no less serious than the one posed in the 19th and early 20th centuries by the German question—the idea of uniting all the German lands to forge a mighty German Empire.

Since those words, Russia’s invasion of Ukraine in February 2022 has already become the worst international crisis since the end of the Cold War. Plokhy worried that a new and terrible stage in the shaping of European borders and populations was emerging. He said that it all depends on the ability and readiness of the Russian elites to accept the post-Soviet political realities and adjust Russia’s own identity to the demands of the post-imperial world. The alternative, he concluded, might be a new Cold War—or worse.

For many of us today, we face the spectre of not only a new Cold War but the prospects of a wider general war in Europe erupting if Russia persists with its post-imperial expansion objectives at the same time as an increasingly authoritarian China is working with its strategic partner in Moscow to remake the international order. This deeply disturbing picture is made all the worse by Putin’s now frequent references to the potential use of nuclear weapons.

I have deliberately begun these introductory words with reference to the deeply entrenched historical context of Russia’s relations with Ukraine, which extend over more than nine centuries. For much of that time—and particularly throughout the more than 70 years of Bolshevik power—Russia’s long history has been consistently reinvented.

As the Soviet-era quip goes: ‘The future is certain. It’s only the past that is unpredictable’, which is applicable to history as remade and retold by Russia’s leadership. And for the Russian President, Vladimir Putin, today’s past is being continually reinvented, along with his reasons for his ‘special military operation’ in Ukraine. Fake news and fake facts are the key tools of his huge propaganda offensive to reinforce Russian popular support for his ‘limited military operation’.

The structure of this paper is as follows:

  1. Why did Putin decide to attack Ukraine?
  2. Why have Russia’s military forces performed so woefully?
  3. What are the geopolitical implications for the world order, including for Australia?
  4. Key policy and intelligence recommendations.

The policy background to this assessment is that Russia’s outright invasion of Ukraine is an extremely dangerous moment for global security because Europe’s security order is now being fundamentally challenged with the real risk of escalation into a major war involving Russia and the US. The ugliest days of this war are in front of us, not behind us.

Moreover, the war is occurring at a time in world history when relations between Moscow and Washington have never been so fraught, and the Moscow–Beijing relationship has never been so close in the past half-century. In comparison, throughout much of the Cold War, senior Soviet and American defence, foreign policy and intelligence officials and nuclear arms control experts engaged in prolonged and deeply informed discussions about each other’s nuclear weapons capabilities and the risks of nuclear war. That involved mutual on-site inspections to confirm the numbers and characteristics of each side’s most advanced strategic nuclear weapons, as well as what the late Professor Coral Bell described as a comprehensive array of measures to signal to each other and engage more closely in times of tension.

Certainly, that wasn’t a foolproof method of avoiding—let alone managing—global nuclear conflict. But the fact remains that the outright use of nuclear weapons (as distinct from their threatened use) was avoided even when towards the end of the Cold War both sides possessed more than 12,000 strategic nuclear warheads on high alert. These days, there are no such confidence-building measures or frequent high-level meetings to signal concerns to each other. That should be a matter of grave strategic worry, given the current state of high tension between Russia and the US.

  1. Serhii Plokhy, The gates of Europe: a history of Ukraine, Basic Books, London, 2015. ↩︎
  2. Serhii Plokhy, Lost kingdom: a history of Russian nationalism from Ivan the Great to Vladimir Putin, Penguin, London, 2017. ↩︎

Budgets, the economy and the Defence Strategic Review

Current debate over how to defend Australia in a more threatening strategic environment points to an urgent need to strengthen the capabilities of the ADF, partly through purchasing new types of weapons incorporating the latest technologies. 

Standing in the way of that need being realised are two factors. One is a trillion dollars of government debt and intense demands for higher expenditure on other public priorities ranging from health care to climate change. The other is a perception that any shift in defence investment away from more established to new types of weaponry would threaten jobs and growth. 

Among the few options available to Defence to overcome both obstacles is avoiding a significant price premium for preferring the domestic over foreign supply of major weapons platforms and systems through a more targeted approach to Australian industry participation. 

That option need not detract from Australia’s independence or economic welfare. Indeed, available data indicates positive outcomes can be achieved, on both fronts, if at least part of what’s saved through avoiding high price premiums in some areas of defence capability development can be re-invested in others.

However, that depends on avoiding the defence industry policy pitfalls of the recent past. Linking an updated defence capability plan to an outdated industry policy is, at best, a high-risk venture. More realistically, it represents a path to disappointment.

This paper addresses how Defence can not only save money when purchasing a new cadre of weaponry but do so in a way that benefits the economy. Both issues relate to affordability which may ultimately determine the impact of the Defence Strategic Review.

Marles’s Defence Strategic Review—an exploding suitcase of challenges to resolve by March 2023

Stephen Smith and Angus Houston have an enormous amount to do and almost no time to do it.  Prime Minister Albanese and Deputy Prime Minister Richard Marles chose them to be the independent heads of the Defence Strategic Review.  

The Review is to report before March 2023 so that the Albanese government can make decisions on it at the same time as they are deciding about the path that gives Australia 8 nuclear submarines within an AUKUS partnership that makes these safe and effective. 

Before they even get to thinking about their task – ‘to ensure Defence has the right capabilities to meet our growing strategic needs’ —Smith and Houston will need to confront the ugly fact that Defence’s current plans are already unaffordable despite the large and growing defence budget the Albanese government has committed to. 

Nasty choices and sub-optimal trade offs are needed before any new ideas that take money are even put forward. And the only mega project not yet agreed to that can provide potential savings is the $20-27bn Army plan to buy an additional 450 heavily armoured vehicles for purposes that aren’t clearly connected to Australia’s needs in our region. These must now be made clear if it is to proceed, in whatever form.

But even multi-billion dollar megaproject is a distraction to the real work. The Review must give Marles what he needs to provide practical, urgent direction to defence in four big areas:

  • Climate change and the Defence Force’s inescapable – but unwanted – role;
  • China’s direct security challenge in Australia’s near region – making our strategic environment uncomfortably clear, not complex as we like to tell ourselves;
  • New ways to increase Australian military power quickly – because no taxpayer is going to give defence more funding if it can’t show it has different, faster ways to increase the ADF’s, military power; and
  • The danger of prioritising ‘integration’ in all things in pursuit of the military nirvana of ‘every sensor a shooter and every shooter a sensor’ – because this highly aspirational goal is the enemy of getting capabilities into the hands of our military fast.

This Strategic Insight unpacks the exploding suitcase of Defence and sets out the key paths the Review can take.

Japan’s security strategy

This special report demonstrates the extraordinary proactivity of Japan towards issues of regional order-building, security and defence policy, and military capability development and teases out the implications for Australia as a closely aligned partner.

The author collates and presents a wide range of disparate official source documentation and thematic analyses to render an appraisal of Japan’s security strategy in a comprehensive but digestible format. The report concludes that, while Japanese activity in the security sphere has been unprecedented and prolific, Canberra must also be aware of certain limitations in terms of resources, and political caveats to Japan becoming a ‘normal country’ or bona fide ‘great power’.

Canberra, too, must be a creative, practical policymaker if the full benefits of the deepening special strategic partnership with Japan are to contribute to a truly free and open Indo-Pacific.

Australian views on the Indo-Pacific Economic Framework

Australian officials surveyed for this research view the Indo-Pacific Economic Framework (IPEF) as an opportunity to bring more investment into the Indo-Pacific region, shape standards setting, form collective solutions to supply-chain risks, and influence the direction of clean energy infrastructure. The IPEF is viewed as a potentially innovative way to boost regional investment rather than as a mechanism to strengthen the usual substance of trade agreements, such as market access into the US.

While we note that the officials interviewed aren’t the ultimate decision-makers and that there’s a new government in Canberra with its own emerging priorities, this report offers insight into the potential opportunities for Australia to shape the framework.

The Australian Defence Force and its future energy requirements

The global energy system is undergoing a rapid and enduring shift with inescapable implications for militaries, including the ADF. Electrification and the use of alternative liquid fuels are occurring at scale across the civilian economies. Despite that, fossil fuels, such as diesel and jet fuel, will be around for a long time to come, given their use in long-lived systems like air warfare destroyers, Lockheed Martin’s F-35 aircraft, M1A2 Abrams tanks, and in capabilities still in the design stage but planned to enter service beginning in the mid-2030s such as the Hunter-class frigates.

Australian supply of these fuels is provided by globally sourced crude oil flowing through a handful of East and Southeast Asian refineries. Supply arrangements for these critical commodities are likely to become more fraught, however. This is already occurring because of the fracturing of global supply chains and the drive for national resilience in many nations, driven by Covid-19, the return of coercive state power and, of course, Putin’s war in Ukraine. Australia’s dependence on imports for liquid-fuel security, at least as it pertains to the ADF, extends well beyond insufficient reserves and refineries.

The government and Defence must recognise this long-term risk to a fundamental input to our military capability and start acting to mitigate it for the future.

The cost of Defence ASPI defence budget brief 2022–2023

The cost of Defence ASPI defence budget brief 2022–2023

One hundred & thirty-three million, one hundred & ninety-one thousand, seven hundred & eighty dollars & eighty-two cents per day.

Executive summary

Shortly before the recent election, the previous government released a defence budget that continued its record of delivering the funding it promised in the 2016 Defence White Paper (DWP) and subsequent 2020 Defence Strategic Update (DSU).

This year, the consolidated defence funding line (including both the Department of Defence and the Australian Signals Directorate) is $48.6 billion, which is 2.11% of GDP based on the Budget papers’ estimates of GDP. That funding represents a very substantial nominal growth of 7.4%. It’s the 10th straight year of real growth, but with inflation running hot, it’s hard to determine a precise percentage; we’ve estimated it at 3.8% based on the Budget papers, but, if inflation stays around 5%, the real growth figure will be less. That will hurt Defence. Just as inflation eats into Australian families’ budgets, it’s eroding Defence’s buying power.

Despite disruptions to supply chains, Defence and its industry partners have achieved significant increases in acquisition spending. While Defence may have fallen short of its acquisition spending target in 2021-22, it still achieved a $2.1 billion increase on the previous year, which was itself a $1.5 billion increase. That’s translating into growing local spending, both in absolute terms and in relative terms compared to overseas spending. We’ve written previously that the Australian defence industry will need to eat a very large elephant as Defence’s acquisition and sustainment budgets grow.

So far, it’s demonstrating that it has the appetite to do that.

Capability continues to be delivered across all domains. There’s no doubt that the ADF is getting better. But we’re seeing the realisation of risks inherent in an acquisition program built around megaprojects. Such projects take years or decades to design and deliver, while spending huge sums for little benefit in the short term. When they encounter problems, those problems are big. The Attack-class submarine program has cost over $4 billion and delivered nothing. The Hunter frigate program continues to experience delays and won’t get a vessel into service for over a decade. The Boxer combat reconnaissance vehicle project has spent close to $2 billion, but only 25 training vehicles have been delivered. While the nuclear-powered attack submarine (SSN) program has the potential to deliver a huge step-up in undersea warfare capability, it’s the mother of all megaprojects and has a risk profile to match. As the megaprojects ramp up (with over $20 billion in infantry fighting vehicles potentially added to the list of committed funds), their cash flow requirement will increase, tying the government’s hands at a time of rapidly growing strategic uncertainty and evaporating warning time.

The new government will have some significant issues to address. Perhaps the biggest one is the size of the defence budget. The incoming government has said that it supports the current level of funding. While that continues to grow in real terms, it was originally developed in 2015 and hasn’t changed since then, despite the significant worsening of our strategic circumstances. Russia’s illegal and unjustifiable invasion of Ukraine has reminded us that war has not gone away and remains a tool of authoritarian states. China’s influence in our near region is growing and could result in a permanent Chinese military presence. The US is looking to its allies and partners to do more, as they must.

As always, the government will need to adjudicate between competing priorities for funding. At a time when Australians are dealing with the rising cost of living, spikes in energy prices and the grinding pressure of housing affordability, it may be tempting to reduce defence spending in the face of competing budget priorities. However, the government should be aware of the results of doing so. The budget is already full, with no pots of unallocated cash. Any short-term windfall delivered by the cancellation of the Attack-class submarine is already gone-as the cancellation of the SkyGuardian armed uncrewed air vehicle to help deliver a $9.9 billion offset for the REDSPICE cyber program reveals. So even holding the defence budget strictly at 2% of GDP will result in substantial, multibillion-dollar reductions to the DSU funding line, inevitably leading to cuts in capability.

Furthermore, it’s not clear that the DSU funding line is even sufficient to deliver the current investment plan. That program includes platforms far larger or more numerous than those they’re replacing as well as entirely new capabilities, all requiring a much larger workforce. Many capabilities have ended up costing more than was originally budgeted for in Defence’s investment plan. The SSN program will cost significantly more than the Attack class; it’s anybody’s guess how much more. So the first order of business should be for the government to understand the affordability of the current plan.

Then it will need to assure itself that the planned force structure is aligned with what the government thinks the ADF should be doing. It’s easy to make a case for the tactical utility of any capability, but how does it fit in the overall strategy? The government will need to make decisions about which sovereign capabilities it needs to hold and where it can rely on allies and partners. And the nub of our current security challenge is that the former are growing while the latter are shrinking.

A further challenge that the government will need to consider is Defence’s people problem. The number of contractors in Defence’s external workforce continues to grow at significant cost, but Defence can’t deliver its ambitious capability program without them. Is that growth the best option available to Defence or simply the only one? Moreover, the investment program will require 20,000 more uniformed personnel to operate the capabilities it’s acquiring. With the ADF averaging net annual growth of only 300, is that target attainable? And, if it’s not, is the future force structure viable?

In these testing times, the government needs to seize every opportunity available to it to increase capability rapidly, even if that means overruling Defence’s long-term vision for the future force. That means doing more with what we’re already getting, such as increasing the lethality of the offshore patrol vessels that are soon to enter service.

There are encouraging signs that Defence is engaging more actively with ‘the small, the smart and the many’; that is, cheaper, disposable, highly autonomous systems that can be produced rapidly by Australian industry. Investing more heavily in such systems is a crucial hedging strategy against the risk inherent in the megaprojects; plus, such systems will figure heavily in future warfare, whatever may become of the megaprojects.

Similarly, the new AUKUS partnership’s advanced technologies programs and the sovereign guided weapons enterprise offer the prospect of delivering meaningful capability soon. Yet we’re two years into the guided weapons enterprise and still have heard nothing about which weapons will be produced and how it will be done. We can’t apply the kinds of timelines and processes inherent in the megaprojects to these lines of effort.

Overall, the government has its work cut out for it. Whatever path it chooses, it will need to bring the Australian public along on the journey. To do that, the government will need to reset the conversation about the defence budget and how it’s spent. That will require a commitment to transparency, accountability and sharing information. That means accepting the risk that bad news will get out along with the good, but an informed public is fundamental to democracy.

AUKUS Update #1: May 2022

On the 16th of September 2021, the leaders of Australia, the UK and the US announced the creation of a new trilateral security partnership called ‘AUKUS’—Australia, the United Kingdom and the United States.

The three national leaders stated, ‘We will foster deeper integration of security and defense-related science, technology, industrial bases, and supply chains. And in particular, we will significantly deepen cooperation on a range of security and defense capabilities.’

At a time of rapidly increasing strategic uncertainty, when it’s increasingly clear that authoritarian regimes are willing to use military power to achieve their goals, it’s important to monitor the implementation of AUKUS so that governments and the public can assess whether it’s achieving the goal of accelerating the fielding of crucial military technologies.

To track the implementation of AUKUS, ASPI will publish regular updates on progress. This is the first of those updates.