Media
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April 16, 2026
LUKE GRANT: The federal government will today announce the 2026 National Defence Strategy. He'll be speaking at the National Press Club detailing new spending from government, but from what we know so far, an additional $53 billion will be put into our defence capability over the next decade, and it's expected that the investment will see defence spending increase to 3% of GDP by 2033. James Paterson is the Shadow Defence Minister. And he is on the line. Senator, thank you for your time.
SENATOR JAMES PATERSON: Good to be with you, Luke.
LUKE GRANT: Thank you, James. The full detail of this plan is to be announced this afternoon, but what we know already in terms of key details is over 53 billion over 10 years. Is that enough?
SENATOR JAMES PATERSON: Well, Luke, it might be true that the government is increasing defence spending by $53 billion, but I'm not ready to give them any credit for that yet until we actually see the detail, because with Labor, it's really important to look at what they do, not what they say when it comes to defence spending. It appears that part of this announcement is just an accounting trick. They are now going to count things like military pensions, which we never normally used to count towards defence spending as part of defence spending. And that's how they say we get closer to 3% of GDP as defence spending. But actually, it doesn't put a weapon in the hand of a warfighter, it doesn't buy a missile or a drone, it's just counting the spending we're already doing differently.
LUKE GRANT: You know what, I saw that earlier and I read what was said about Marles about the, you know, using the NATO measure for defence spending, and I thought, why would you all of a sudden say that? So the idea that the funding of pensions of military personnel represents a cost of defending your country, that is, I mean, that's extraordinary, to think that they can get away with that, that's laughable.
SENATOR JAMES PATERSON: No Australian government has ever counted that towards their defence spending as a percentage of GDP. And this is a government that's under a lot of pressure to increase defence spending, not just from the opposition, but from eminent independent experts like Sir Angus Houston and Professor Peter Dean, who completed the defence strategic review for the Albanese government. And they said we need to be spending 3% of GDP on defence. But they meant 3% of GDP on defence capability, on real things that go into the hands of warfighters, not just an accounting trick or a budget treatment change that pretends we're spending more when actually we're just spending the same.
LUKE GRANT: Why are we going to the private sector? I mean, you would argue, I think, wouldn't you, that the security of a nation, national defence, is the business of government. They should be funding it, surely. What are we doing here?
SENATOR JAMES PATERSON: So it appears that the government is going to invite the private sector to invest in perhaps some defence infrastructure, things like the Henderson and Osborne shipyards in Western Australia and South Australia. Now that is potentially appropriate, but again it will depend on the details. I don't want the government to use this private sector investment in infrastructure as an excuse not to spend taxpayers money on defence to deliver defence capability because right now we're trying deliver AUKUS, which is critically important, on 2% of GDP, which is what it always has been for a number of years now, and that is cannibalising other capabilities, particularly of the Australian Army, and that's why this government has cancelled so much capability.
LUKE GRANT: You know, they said when I think Donald Trump made mention of what he expects his allies to be spending on defence, you know, that proudly said, oh, we'll decide the money we spend and how we'll spend it. Is there a little bit of Donald Trump? Will Donald Trump like this about what's being said today? Sounds like it.
SENATOR JAMES PATERSON: Well, certainly, if they're not actually increasing defence spending and they're just playing games with accounting to appease our American friends, that would be a grave mistake and not treating the Australian people with the respect they deserve, and frankly, not treating our men and women in uniform with the respect they deserve. What we need are real increases in defence spending. And we need it now, not in five years or ten years, which is what this government's plan has been previously, to increase defence spending to about 2.3% GDP by the mid-2030s. That's far too slow. We're living in a dangerous world right now, we need investment right now to deter and hopefully prevent conflict, and to survive it if we fail to prevent it.
LUKE GRANT: Yeah. What about the idea that some of this money comes from the sale of military assets? As you know, Victoria Barracks in Sydney has been a controversial announcement. Lots of Sydney-siders are very much against that. Where are you on that issue?
SENATOR JAMES PATERSON: Well, to put it in context, the federal government will spend about $59 billion this year on defence and they say that they will get about $1.8 billion in net proceeds as a one-off from selling these assets. But I'm deeply sceptical they will ever realise the full benefit of those sales even if they proceed because it's always more expensive to deal with amelioration of defence sites because of PFAS and lead and other issues in the soil. So I don't think they'll ever realise that, and it's just a one-off hit to the budget. What we actually need is ongoing recurrent increases in spending that can only come from the budget, and the cost of this is selling off our military heritage that we will never be able to recover. I don't think a serious country sells off their military heritage, and I think it would be a grave mistake to banish the Australian Defence Force from our capital cities by getting rid of these high-profile sites in our CBDs like the Victoria Barracks.
LUKE GRANT: What about the idea of manufacturing weapons here? We've already done pretty well in the area of drones and the like. Do we support Australian defence manufacturers enough in your eyes?
SENATOR JAMES PATERSON: Absolutely nowhere near enough. We need to be supporting particularly the small, innovative, disruptive, start-up firms in Australia who are doing incredible things with drones and other capabilities. Many of them have exported them successfully to Ukraine, but find it hard to sell them to the Australian Defence Force. And this government has often had a preference in the past of choosing big international defence primes rather than giving the Australian defence industry a leg up and an opportunity. And in the area of these new technologies, it is often the smallest firms, the most dynamic, entrepreneurial and innovative firms that can move the quickest to provide the new capability. There is of course a place for big defence contractors, particularly ones who can deliver major platforms like ships, and submarines, and planes that no small company can do. But actually, in new technology, sometimes it's the small firms that are the best.
LUKE GRANT: We've seen announcements this week from government, new Chief of Navy, Chief of Army, amongst other things. What do you make of those announcements? I guess it can't be critical or too over the top, but around the area of timing and the like, are you comfortable with all of that?
SENATOR JAMES PATERSON: I am. They are eminent and qualified people, and I know Vice Admiral Mark Hammond the best from my dealings with him in the past, and he is a widely respected leader in the ADF and will be a great Chief of Defence Force. But Susan Coyle also has an exceptional record of service to the Australian Army and the people of Australia. I do think it's strange that the government has not yet announced their replacement for the Secretary of Defence. He has been announced as our new Ambassador to Washington some time ago. That's a now vacant position, and it's a critically important one, particularly when you're announcing a new defence strategy, so they need to pull their finger out and announce who the new Secretary of Defence will be.
LUKE GRANT: And in terms of, and we got policy this week in the area of immigration, can we expect defence policy announcements from the Coalition sometime soon or not?
SENATOR JAMES PATERSON: Well, we've already said that we think we need to be spending 3% of GDP. It’s one of the first announcements we made after the election under Sussan Ley's leadership and it has continued under Angus Taylor's leadership. We'll announce the details of how and when we'll get there closer to the election because we need the budget information from the government before we can commit to that. And we'll also start to outline some of the areas which we think that should be spent. Obviously, drones and missiles are critical in the new age of modern warfare that we're living in. But so are counter-drone and counter-missile defences and I'm particularly alarmed by the lack of integrated air and missile defence in Australia, particularly for our northern bases, but also our major cities and key infrastructure facilities like our ports.
LUKE GRANT: Great to chat, James. Thanks so much.
SENATOR JAMES PATERSON: Thanks for having me.
ENDS