Making Australia's Defence supply chains more resilient – new Ai Group & Perth USAsia Centre report

"The national employer association Ai Group, together with its partner the Perth USAsia Centre, has today released a new policy report that examines the strategic risks facing Australia's defence supply chains as we get deeper into the roll-out of the largest defence procurement spend in Australia’s history," Innes Willox, Chief Executive of the national employer association Ai Group said today.

"Given the mission-critical nature of our defence platforms, and an increasingly challenging geopolitical environment, national security depends on strong defence supply chain resilience. However, like many sectors, the Australian defence industry has faced growing supply chain pressures in recent years.

"Developed with the support of the Department of Defence's Strategic Grants Program, this report, Securing Australia's Defence Supply Chains, takes stock of the security of Australia's defence supply chains, and maps a resilience agenda for the industry's future.

"Defence has matured its supply chain approach in recent years, including via investments in new tools and capabilities to identify and protect vulnerabilities. Nonetheless, there remain areas where further effort is required to properly secure Australia's defence supply chains," Mr Willox said.

Kate Louis, Ai Group's Head of Defence and National Security said: "As strategic risks to supply chains increase, stronger governance structures and policy frameworks are also required. These should set core concepts and definitions for supply chain security, provide risk assessment frameworks, and identify options for interventions to address identified vulnerabilities. This additional protection is particularly important in the context of our large Defence spend."

The report recommends that Australia needs:

• A comprehensive strategy and action plan for the strategic protection of defence supply chains.
• Robust and scalable mechanisms for generating information on defence supply chain risks.
• The establishment of governance structures that allow regular and organised engagement with industry.
• To develop a clear methodology to identify, select and resource supply chain interventions to identified risks.
• To increase the priority accorded to supply chain issues during Defence procurement processes calibrated by risk.
• Collaboration with international partners to enable trusted capability supply chain options.

"Greater collaboration with defence industry is critical to achieving supply chain security. This can be achieved through information sharing and consultation with industry, as well as a sharper focus on supply chain issues during procurement and contracting," Ms Louis said.

The full report: Securing Australia's Defence Supply Chains is available here.

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Kate Louis – 0428 681 061