Australia Faces $33 Billion Drop In Military Purchase Plan

Australian federal government is facing a funding shortfall of $33 billion over the next decade, which they planned to use for modernizing the armed forces with new military hardware.

The Australian Strategic Policy Institute also says that the government will face a crunch time in three or four years, when it will have to decide whether to pump more money into defence or scale back its ambitions. 

In its annual defence budget briefing paper - regarded as a kind of bible for defence budget analysts - the institute makes a blunt assessment about Australia's military posture towards China. It points out that while the recent defence white paper played down its 2009 predecessor's concerns about China as a threat, Australia is going ahead with the same acquisitions of fighters, ships and submarines, suggesting it regards China as warily as it did four years ago. 

Mark Thomson, the institute's senior analyst for defence economics and the author of the paper, said the government had improved its defence spending compared with the deep cuts of previous years, with an average of 3.6 per cent real growth over the next four years. But this was coming off a low base. 
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''What really matters is whether the government has committed enough money to deliver the defence force it says we need. The short answer is that it has not,'' he said. That meant in the next three or four years, Australia would have to make tough decisions, for example, between an army that could quickly deploy to trouble spots or a high-tech air force and navy. 

Dr Thomson's paper also said the government's relatively soft language towards China in the 2013 defence white paper was at odds with the big outlays on fighter planes, submarines and ships. The plans to buy radar-jamming Growler fighter planes, 12 submarines and other big acquisitions could be seen as ''hedging'' against a confrontation with China, he said.