As has been widely canvassed, this month we should get the outcome of an 18 month study to determine what type of nuclear powered submarine Australia will acquire and build. This announcement will coincide with Australia’s Defence Strategic Review, and was also expected to align with the release of the U.K.’s Integrated Review – Refresh.
But while the AUKUS agreement and submarine procurement hits the daily headlines in Australia, the deal isn’t part of the daily agenda in the U.K. where other issues, namely Ukraine, dominate the defence agenda. The latest update to the Integrated Review, which considers the U.K.’s defense and foreign policy settings, had been tipped for release in early March but has reportedly been delayed because the submissions from the military were ‘unimaginative’.
On the submarines, pundits are expecting the solution to be a “three humped camel” or more accurately a bespoke solution based upon the U.K. SSNR design. But it may have a U.S. nuclear propulsion system and be equipped with a mix of communication, technologies and weaponry, some of which will be home grown in Australia. Whether this boat is then utilised by all three nations remains to be seen. But it would seem logical that it would be. Having a common hull and systems would mean sustainment and maintenance economies of scale could be accrued.
But AUKUS is not just about submarines, albeit that will be where the big money will need to be spent. The second pillar, or “line of effort” in American parlance, includes a host of other interesting areas of development aimed at ensuring the three nations, and likely selected allies, maintain a leading edge. This includes agreement to work collaboratively on advanced technologies including cyber capabilities, artificial intelligence, quantum technologies, and additional undersea capabilities.
This is an arena which interests us at Bondi Partners particularly, and we are excited to see a real opportunity for public and private sector collaboration. Each of our three nations have very highly skilled SMEs, as well as defence primes, that are already on the leading edge of these various technologies. Pooling the national know-how and capabilities will be vital to ensuring the AUKUS nations can keep up with and head off hostile actors.
There are challenges, however. The transfer of technologies between even these three nations who already share intelligence and a very close, or special, relationship still needs to be agreed upon. The U.S. International Traffic in Arms Regulation (ITAR) is seen as a hurdle that lawmakers in the U.S. may be unwilling to ignore despite most believing the system is antiquated and needs a complete overhaul – especially to support this partnership. While it is unlikely that all restrictions will be removed, the success of AUKUS is dependent on at least an easing of the ITAR restrictions for the U.K. and Australia.
The design of a nuclear boat for Australia is the relatively easy part. Finding enough qualified people to do the work is the real challenge as it takes time to grow this expertise. The AUKUS countries will probably have to ‘share’ the manpower whilst Australia develops a pipeline of qualified nuclear scientists and engineers. Whilst this sounds easy there are challenges to be overcome here too. Both the U.K. and U.S. have to continue their own submarine programs meaning that these expert personnel are not readily available for the Aussies to ‘borrow’.
From a UK standpoint the challenges to delivering on the agreement are complex. The government has inflation to deal with, a cost of living crisis, public sector strikes and a war in Ukraine. The latter is occupying much time and effort in Whitehall – quite rightly. The U.K. has been resolute in supporting Ukraine, but at what cost and what implication to AUKUS? Ben Wallace, the U.K. Secretary of Defence, has admitted that the British Army has been “hollowed out and underfunded”. The Treasury has allocated £2.3 billion to replenish the stocks that have been given to Ukraine but General Sir Richard Barrons estimates £3 billion is required for the Army alone. Wallace has asked for an extra £10 billion to cover the next three years for all three services. It will be interesting to see what is allocated by the Chancellor in the spring budget and how this will impact the AUKUS agreement which will require significant funding levels.
Another issue that seems to be rarely spoken about is the impact of political change. Both in America and Australia we have seen the leadership change from conservative to progressive and most commentators expect a change in the U.K. at the next general election. Given the depth and complexity of domestic issues in the U.K., the war in Ukraine and the absence of public recognition for AUKUS, you have to wonder where the political will comes from to keep this partnership moving forward and the U.K. in AUS.
 The Submersible Ship Nuclear (Replacement) or SSN(R) is a planned class of nuclear-powered fleet submarine (SSN) intended to enter service with the Royal Navy in the 2040s as a replacement for the current Astute class, the last of which will be delivered in 2026.