Hunter Defence

The Cost of Defence 2020-2021

The Australian Strategic Policy Institute (ASPI) has released Part 1 of its 2020 Defence Strategic Update Brief focussing on the Government’s recent Defence Strategic Update (DSU) and its supporting Force Structure Plan. The paper, prepared by Dr Marcus Hellyer, Senior Analyst, Defence Economics, outlines the ‘remarkable commitment’ by the Australian Government to sustained growth in the defence budget – measured from a starting point in 2019-2020, the budget is planned to grow by 87.4% over the coming decade. The paper explores why the Government has made such a commitment, centring on its concerns about the country’s strategic circumstances and its assessment that these have deteriorated significantly since the release of the Defence White Paper in 2016. It states that the region is in the middle of the most consequential strategic realignment since World War II. The government regards robust military capabilities as essential to managing the significant uncertainty and risk that this environment brings.. As the ASPI paper outlines, the DSU marks a clear break from previous high-level strategic statements in the frank way it describes those risks and the new capabilities needed to address them. It also makes several key adjustments to strategic policy settings:
  • It redefines our immediate region to an arc from the northeastern Indian Ocean, through maritime and mainland Southeast Asia, to Papua New Guinea and the Southwest Pacific.  
  • It prioritises the immediate region for defence planning. 
  • It introduces the concepts of ‘shape’, ‘deter’ and ‘respond’ to focus defence planning. The emphasis on shaping reinforces the importance of regional engagement and partnerships in creating a region conducive to our interests. 
  • It states that a largely defensive force won’t deter attack. Instead, ‘new capabilities are needed to hold adversaries’ forces and infrastructure at risk from a greater distance. They include longer range strike weapons, cyber measures and area-denial systems. 
  • It acknowledges that Australia can no longer rely on warning time, even for a conventional military attack on our shores, and so won’t have time to ‘gradually adjust’ military capabilities
You can read the full paper here – ASPI Cost of Defence 2020-2021 Acknowledgements: The content in this blog is exacted with some edits from the contents of the paper written by Dr Marcus Hellyer, Senior Analyst, Defence Economics. Report cover image by David Rowe.

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