Overhaul ... Defence Minister Kevin Andrews has commented on a report into the operations of the Australian Defence Force. Picture: News Corp Australia Source: News Corp Australia
THE Australian Defence Force is set for its biggest shake-up yet after an independent review recommended transformational reforms that could see up to 1650 public service jobs cut.
The long-awaited first principles review, "One Defence", unveiled in Canberra yesterday is the Government's plan to lift the under-fire organisation's efficiency.
Its panel found Defence is akin to a loose federation which suffers from a proliferation of structures, processes and systems, with unclear accountabilities, institutionalised waste, delayed decisions, duplication and flawed execution.
Defence Minister Kevin Andrews said the review delivered on a Coalition election commitment to ensure that Defence is appropriately structured and organised "in the 21st century".
The organisation costs taxpayers almost $30 billion a year.
Review ... Defence Minister Kevin Andrews, second from left, at Parliament House. Picture: News Corp Australia Source: News Corp Australia
"The review found that Defence has implemented significant changes and improvements since the 1990s and has a proven record of delivering in the field, on operations and in humanitarian and emergency support roles at home and abroad," he said.
"However, despite Defence's outstanding operational record, it is clear that there needs to be a better balance between operational excellence and organisational effectiveness."
The Review proposes transformational change across Defence to ensure it can deliver on the future requirements that will be outlined in the Government's forthcoming Defence White Paper.
There have been some 45 major and minor reviews of different aspects of Defence Since 1973.
This latest rules them all, making 76 recommendations of which the federal government agreed — or agreed in principal — to 75.
The review did not specifically set out to boost Defence efficiency or cut jobs, but some 1650 public service jobs will go as reforms are implemented over two years.
The restructure involves abolishing one of seven three-star general positions and six senior executive service positions, of which there are currently 174.
Changes ... Defence Minister Kevin Andrews said Defence needed a 'better balance'. Picture: News Corp Australia Source: News Corp Australia
Defence will retain its diarchy, with the chief of the defence force and department secretary as joint leaders, but some senior civilian and uniformed positions will go.
The defence equipment acquisition arm, the Defence Materiel Organisation, will be disbanded and core responsibilities transferred to a new capability acquisition and sustainment group to make defence more of a smart buyer.
The Review outlines a two-year implementation plan, with key milestones, which provides high-level direction for Defence.
This comes after The Australian newspaper last week published leaked details, indicating the report was scathing of defence for its excessive number of managers and lengthy bureaucratic processes.
The review was conducted by former Australian head of Rio Tinto David Peever, assisted by a panel comprising former army chief Peter Leahy, former Howard government defence minister Robert Hill, former Labor finance minister Lindsay Tanner and a former head of defence company BAE Systems Jim McDowell.
'Shortcomings' ... Defence Materiel Organisation will be disbanded in the wake of the review. Picture: Daniel Munoz/Getty Images Source: Getty Images
"The shortcomings identified by the Review affect all of Defence and need to be urgently addressed," Mr Andrews said.
"To achieve this, Defence must move from the current inefficient, federated approach into a single, integrated organisation that delivers enhanced joint capability."
The Secretary and the Chief of the Defence Force will begin work immediately to implement the recommendations within two years and their progress will be monitored by an Oversight Board.
The four recommendations that received only in-principle agreement relate to increasing the approval thresholds for capability development projects; ceasing the use of net personnel operating costs (NPOC); increasing the thresholds for referring proposed works to the Parliamentary Standing Committee on Public Works and changes to other budget operating rules; and disposal of estate.
The Government did not agree to the recommendation relating to the Defence Science and Technology Organisation becoming part of the new Capability and Acquisition Group at this time. However, it has explicitly stated that this recommendation will be further considered as part of the annual updates on implementation progress.
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