Funding and Delivering the 2016 Defence White Paper

The 2016 Defence White Paper contains plans for the most ambitious expansion and modernisation of the Australian Defence Force since at least the Menzies build-up in the early 1960s. To back up the plan, the government has committed to a decade of explicit funding guidance, which will see defence spending reach 2 per cent of Gross Domestic Product in 2020-21 and rise to 2.2 per cent in 2026-27. The plan and its funding are not assured. Past defence funding commitments have tended to be unreliable, and future governments may struggle to balance a rising defence budget against competing demands to retire debt, reduce taxes and maintain government services in other areas. At the same time, the rapid increase in investment—especially in naval platforms to be built locally—will test the capacity of the Department of Defence and local industry to deliver capability on schedule, especially given the ongoing extensive, yet untested, reforms to the Department’s processes and workforce.