Defence Industry Reception

Parliamentary colleagues, Secretary of Defence Helen Quilter, Chief of Defence Force Lieutenant General Tim Keating, representatives of industry, Defence personnel and officials, distinguished guests: It is a pleasure to be here this evening, and to see such a good turnout.

I would like to start by thanking Greg Lowe, the Chair of the Defence Industry Advisor Council, and Scott Arrell, the Chair of the Defence Industry Association, for hosting this reception with my office.

This is an important event. 

In November last year, the Government launched the Defence Capability Plan.

The Plan detailed investment of up to $20 billion in new and upgraded military capability out to 2030, including the replacement of all our major assets and the regeneration of the Defence Estate.

Tonight it’s appropriate that we acknowledge the good progress we have made together in implementing that Plan.

Since the publication of the Defence White Paper 2016, contracts have been negotiated for military capability worth over $650 million.

A Defence Estate Regeneration Plan worth around $1.7 billion has been approved.

Good progress has also being made on the replacement of our major platforms as signalled in the Defence Capability Plan.

In June, Cabinet approved the strategic case for the Future Air Mobility Capability project, directing officials to come back next year with options to replace our long-serving C-130 air transport fleet.

We are also on track to consider options for replacing the Maritime Patrol Capability currently provided by our equally long-serving P-3 Orion fleet.

For every dollar spent on new capability, four are spent on supporting it.

Each year the Defence Force spends $600 million in New Zealand on maintenance and repair, training support, and other commercial services.

This equates to 9,000 contracts for goods and services, ranging from long-term maintenance and repair contracts to the provision of consultancy services.

The Government’s forecast investment in Defence over the next decade is significant.

It is driven by the need for a Defence Force that is equipped and supported so that it can continue to respond to a rapidly changing strategic environment.

These changes include growing tensions in the Asia-Pacific area, an international terrorist threat, and an immediate neighbourhood that continues to face a range of economic, governance and environmental challenges.

There is also a need to invest in protecting the Defence Force’s networks from increasingly sophisticated cyber threats.

The Government’s investment in defence to meet these challenges also represents a major opportunity for industry.

Many of the small and medium-sized enterprises represented here tonight got their start in defence in the 1990s as part of the Anzac Ship Project.

That project required New Zealand suppliers to lift their performance in line with the stringent quality standards demanded by high-end military capability.

Some suppliers were able to leverage that opportunity to expand into export markets where they have competed successfully for work from the most demanding of clients.

Our comparatively small size means we are not builders of warships or military aircraft, but New Zealand companies can provide those capabilities with world-class products and systems, and can support them through life.

Early engagement is critical to achieving this.

Both the Ministry of Defence and the New Zealand Defence Force have in place new initiatives to engage industry early on their procurement plans.

Early engagement means fewer surprises and better quality solutions. Potential suppliers will know what we want, know what we are willing to pay, and will be given the opportunity to put forward innovative supply solutions.

Early engagement will also provide more opportunities for prime contractors, local suppliers, and Defence’s strategic partners to build relationships early, ensuring the equipment and services we buy today are supported through life.

This is an important point.

While the capabilities of the New Zealand Defence Force are state-of-the-art, our size means we will never have large fleets.

It is critical, therefore, that our capabilities are well supported and that unscheduled maintenance and repair is kept to an absolute minimum – we need our aircraft on the flight line and our ships at sea.

Much of the equipment we will be replacing over the next decade uses yesterday’s science and technology.

In a rapidly changing strategic environment, it is critical that the capabilities we are acquiring now are based on tomorrow’s science.

This requires Defence to reach out to the widest pool of potential innovators in industry, universities, and other research organisations.

It is very pleasing, therefore, to have here tonight representatives from the Defence Technology Agency, Callaghan Innovation, and our universities.

In closing, my first few months as Minister of Defence have been both very busy and rewarding.

Personal highlights include attending the Defeat-ISIS Ministerial meeting in Copenhagen, attendance at the Shangri-La Dialogue, the Five Powers Defence Arrangements Defence Ministers meeting in Singapore, and a counterpart visit to Indonesia.

I have also visited our personnel in Camp Taji, observed P-3 maritime security operations in the Middle East, overnighted on the frigate HMNZS Te Kaha, a visit which included a simulated warfare exercise, and visited a number of the Defence Force’s camps and bases.

These visits have highlighted to me the dedication and professionalism of our servicemen and women, often under very challenging conditions.

I have seen through my engagements the very high regard in which our Defence Force personnel are held by our partners.

The Government is committed to maintaining and expanding this, and a strong partnership with industry is a critical element of achieving that. 

I haven’t met you all yet, but I look forward to doing so, if not tonight then at some other time.

Welcome, thank you for coming along and thank you for your attention.