Army vehicles get the chop as government frees up money for AUKUS

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Plans to spend up to $30 billion on new tank-like vehicles for the army will be slashed to free up funds for long-range strike missiles, cybersecurity and nuclear-powered submarines under a sweeping overhaul of the Australian Defence Force.

The government will on Monday release a declassified version of its defence strategic review, designed to restructure the nation’s military for security threats such as a possible war with China.

Some controversial decisions will anger the army, whose leadership has feared it will be downgraded in favour of the navy as the government prepares spend up to $368 billion on nuclear-powered submarines over 30 years under the AUKUS pact.

Labor will blame the previous government for the need to make difficult spending cuts, accusing the Coalition of announcing additional military spending worth $42 billion in its last two years in office without providing sufficient extra funding for the Defence portfolio.

It is understood the review calls for an array of costly projects to be delayed, reduced or scrapped and that the government has accepted these recommendations so that scarce funding can be reallocated to other projects.

Defence Minister Richard Marles has described the review, conducted by former defence minister Stephen Smith and former Defence Force chief Angus Houston, as the most important examination of the nation’s military capabilities since Paul Dibb’s influential 1987 Defence White Paper.

Sources speaking on background to give a fuller picture of the classified review told The Sydney Morning Herald and The Age a centrepiece of the government’s response would be a decision to cut the planned construction of infantry fighting vehicles from a fleet of 450 to a single battalion of 129 vehicles.

The LAND 400 Phase 3 Infantry Fighting Vehicle project, announced by then-defence minister Marise Payne in 2018, was set to be the most costly acquisition project in the army’s history with an estimated price tag of $18 billion to $27 billion.

The number of new infantry fighting vehicles will be cut from 450 to 129.

The decision will also upset Queensland Premier Annastacia Palaszczuk and her state’s defence industry given the vehicles are slated to be built in Queensland by either South Korean defence contractor Hanwha or German company Rheinmetall.

Army Chief Simon Stuart has championed the new infantry fighting vehicles, which will replace a fleet of armoured personnel carriers in service since the 1960s.

“The combined arms fighting system that protects our soldiers today has at its core a 60-year-old armoured personnel carrier,” Stuart told a conference in Perth last year. “We can and we must do better, and we have a plan to do so.”

The proposed vehicles can carry six soldiers and are equipped with cannon, remote-controlled machine guns and anti-tank missile launchers.

Defence experts have questioned how the vehicles would be used in a conflict, an argument that resonated with Prime Minister Anthony Albanese.

Last year Albanese told The Sydney Morning Herald and The Age that “our defence assets need to not be about fighting a land war defending western Queensland because that is highly unlikely”, adding that “a lot of our assets are not really the ones that we necessarily need for this century and for the times”.

The strategic review also recommends immediately cancelling the army’s order for a second regiment of self-propelled howitzer artillery weapons.

By contrast, it will call for the acquisition of the HIMARS long-range rocket system – which has been hailed for its success in the war in Ukraine – to be accelerated and expanded as well as the fast-tracking of land-based maritime strike capabilities.

The review will also call for the acceleration and expansion of a planned fleet of army amphibious manoeuvre vessels, which are designed to transport military assets from land to sea.

The premise of the review is that the previously estimated 10-year window of a warning for any military conflict has significantly narrowed, so Australia needs to be better prepared to fight a war in the short term.

The review is also expected to call for increased spending on drones, cyber defences and jet fighters, while examining how to fortify military assets from attack and ensure the Defence Force is not overwhelmed by demands to assist during natural disasters.

The government will argue the Defence budget was significantly overstretched when the review was launched in August 2022, forcing the need for difficult trade-offs.

Opposition defence spokesman Andrew Hastie has warned the Coalition did not want to see any capabilities in Defence cannibalised to pay for new projects.

In an interview last week, Navy Chief Mark Hammond urged Australians to see the nuclear-powered submarine program as a nation-building endeavour on par with the creation of the Snowy Mountains hydro-electric scheme.

Marles has previously said the concept of “impactful projection” would be “the cornerstone of future Australian strategic thought” and that the nation would need to acquire “high-end military capabilities to do this”.

“The ADF must augment its self-reliance to deploy and deliver combat power through impactful materiel and enhanced strike capability – including over longer distances,” he said last year.

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