Senator the Hon Mathias Cormann

The Government has taken the next major step to put the $8.5 billion Air Warfare Destroyer program back on track to deliver critical capability for the Royal Australian Navy.

Following a competitive procurement process, BAE Systems, Navantia SA and Raytheon Australia will take on increased roles in the Air Warfare Destroyer program for an interim period. Their increased involvement will drive immediate improvements in shipbuilding performance.

The Government is committed to putting this important Defence project back on track and stop the growing cost and schedule overruns we inherited from our predecessors by implementing the Reform Strategy recommended by Professor Donald Winter's Independent Review of the Air Warfare Destroyer program.

This focus on resolving outstanding productivity issues will ensure opportunities to improve performance for the duration of the project are maximised.

The outcomes of this interim period will also inform the Government's considerations on the Australian naval shipbuilding industry in the context of the 2015 Defence White Paper.

This interim period marks a turning point in the performance of ASC and its partners on this important project and will help renew confidence in the future of Australia's shipbuilding industry.

No decisions have yet been made about the long term arrangements for the Air Warfare Destroyer program.

The Air Warfare Destroyer Alliance Industry Participants – ASC Shipbuilder and Raytheon – will continue to be responsible for the construction and delivery of the three ships

We are committed to working collaboratively and constructively with all stakeholders to ensure we realise both the critically important national security benefits of this program as well as its long term benefits for the Australian shipbuilding industry in the most efficient and effective way possible.