Defence Policy Review: Time stops for no government

Major procurements require a steady drumbeat of activity, writes Wayne Mapp, and the post-2023 election government will have purchase decisions to make in relation to the ANZAC and Project Protector fleet replacements.

In October this year, Defence Minister Peeni Henare announced the establishment of an Advisory Panel for the recently established Defence Policy Review, which will be undertaken by the Ministry of Defence.

The Advisory Panel is to be chaired by Sir Brian Roche. The membership includes quite a number of people well versed in defence and foreign policy. The full membership is former Chief of Army, Dave Gawn, Sir Don McKinnon, Professor David Capie, Comptroller of Customs, Christine Stevenson and Pania Tyson Nathan, Chief Executive of NZ Maori Tourism. Sir Brian has substantial experience in Defence Reviews, including chairing the ministerial advisory committee for the 2015 Defence Review.

It is intended that the Defence Policy Review will be completed in 2024, after the upcoming election. Even if there is a change of government, the Advisory Panel may well survive, particularly given its well-balanced membership. By the time of the election they and the Ministry of Defence will have done considerable work which would be of value to any government.

It seems unlikely that the Defence Policy Review will substantially change the direction and orientation of Defence. More likely it will be a refresh of the existing policy framework. Since 2010, defence reviews, or analogous processes, have taken place on reasonably regular intervals, typically around five years apart. As such they tend to build on the prior work and signal the critical decisions that have to be made within the next five years or so.

Ron Mark, as Minister, made the most significant procurement decisions of the last ten years, providing for the replacement of the C130 Hercules and the P3 Orions, as well as buying 43 Bushmaster to replace the Pinzguaer. These had been well forecast in the 2015 Defence Review as critical capabilities for early replacement.

Since 2010, other Ministers have also made important decisions, including Gerry Brownlee authorising the procurement of HMNZS Aotearoa. More recently the covid crisis has deflected government attention. Minister Peeni Henare has also had to deal with the Ukraine war and the ongoing implications for defence.

The Defence Policy Review will have to take into account the changed circumstances of the international situation, in particular whether New Zealand should increase overall defence spending in line with its international partners. As I have noted in previous articles, even a reasonable boost in defence spending would be unlikely to change the basic structure of the Defence Force. Instead such an increase would go toward building resilience within the existing core capabilities, while providing certainly for the replacement of the key platforms when required.

Although major procurements can be anticipated many years ahead, there is some discretion as to when their replacement will actually be required. Nevertheless, there is ultimately something of a hard barrier since excessive deferral might lead to total failure of critical capabilities.

Major procurements require a steady drumbeat of activity to ensure that capabilities are replaced before the existing platforms become effectively unusable. The likely time for that can be readily forecast. For instance, while the ANZAC frigates can be stretched out to 2035, when they will be nearly 40 years old, going much beyond that would likely lead to their complete failure as credible combat capable units.

The Defence Policy Review will have to focus on sorting out replacement of the ANZAC frigates and the Project Protector fleet, just as the 2015 Defence Review dealt with the replacement of the C130s and the P3 Orions. The replacement of both these naval capabilities will be the largest procurement decisions since the initial acquisition of the ANZAC frigates in 1989, nearly 35 years ago.

In previous articles, I have discussed the options to replace the naval fleet. There are three key capabilities to be considered. These are the combat capable ships, the ANZAC frigates, the patrol fleet, being the two OPVs, and the multi-role sealift ship, HMNZS Canterbury.

In my column in the Spring 2021 edition of Line of Defence, I noted that the Type 31 frigate could be configured as a high or low capability ship and as such could replace both the ANZAC frigates and the OPVs. A fleet of four ships to a common basic design would certainly be an improvement on the current mixed fleet.

There are of course other credible options. The Defence Policy Review should be able to indicate the credible range of choices. The 2015 Refence Review did not go so far as recommending the specific platform choice but instead used exemplars as a guide to the likely platform. Ultimately both exemplars, the C130J and the P8 Poseidon, were actually chosen as the replacement platforms.

The 2024 report back date for the Defence Policy Review suits the procurement timeframe. If the plan is to have new naval capabilities in service around 2035, that leaves eleven years between the report back date and the in service date. It will only be just enough time.

The decision-making processes of the government mean it will take a minimum of two years from the report back to an actual tender being accepted. That leaves eight or nine years to actually build the replacement ships. It is almost certain that a proven design will be chosen, but any New Zealand order will have to take its place in the production cycle. There will also be the real possibility of substantial work in New Zealand, as was the case for the ANZAC frigates.

The length of the decision cycle reinforces the importance of each government making timely decisions, taking each electoral cycle as a government, even if the subsequent government has the same fundamental composition. Leaving a key decision to the next government can throw out coherent planning and risks capability failure, particularly toward the end of the lifecycle of critical capabilities.

Looking ahead to the likely out of service dates for both the ANZAC and Project Protector fleets means that the next government of 2023 to 2026 will have to make the purchase decisions for the replacement ships. That means more than simply starting the process. The government will need to actually enter into a build contract with a ship builder before the 2026 election.

During the next twelve months, prior to the election, each political party should make clear what their view on appropriate defence policy is. While defence is unlikely to be a top line policy, the major parties especially have enough depth to provide an informed view as to their policy. It is not just an issue for the New Zealand electorate. New Zealand’s partners, in particular Australia, also have an interest in our defence policy given the increasingly challenging international strategic environment.

Hon Dr Wayne Mapp QSO was New Zealand’s Minister of Defence and Minister of Science and Innovation from 2008 to 2011.