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Transcripts
May 28, 2026
SENATOR JAMES PATERSON: The Australian Strategic Policy Institute has released a report as it does every year on the defence budget and it calls out Richard Marles' claims of increased government spending on defence. Richard Marles has been claiming $14 billion of increased defence spending over the forward estimates and $53 billion over the decade. If that was true I would be the first person to welcome it and congratulate the government, but it turns out it's not. It turns out, in fact, that $14 billion of supposed increased government spending is actually only $6.8 billion over the forward estimates, and that $53 billion of investment over the next decade is in fact only $35 billion. You don't need to rely on ASPI. Marcus Hellyer of Strategic Analysis Australia has made the same point, and if you don't want to rely on him, well just look at the evidence given by the Department of Finance in Senate last night to my colleague Dave Sharma. They admitted that in fact it only is $6.8 billion of government funding from consolidated revenue over the forward estimates, only $35 billion over the decade, and that all the other funding for defence over that period is highly uncertain. Decisions haven't been made, in the words of the Finance Minister. If this is the most dangerous strategic environment since World War II, and I believe it is, as Richard Marles says it is, then it's time the government matches their rhetoric with reality. It's time they actually delivered the defence funding that the ADF needs. Our men and women in uniform are not made safer by accounting tricks or spin, and nor is our country.
JOURNALIST: The Deputy Prime Minister was up at the press club a while ago when he announced this record spend in defence. If those numbers now aren't the case, how would you describe that and what do you think that says about the government?
PATERSON: I think it's dishonest and I think that it's disappointing. I want the government to succeed when it comes to national security and defence. I want them to succeed, when it comes to AUKUS. But standing up to the Press Club and claiming you're spending money that you're not actually spending doesn't make us safer. And what we need from this government is decisions around the Expenditure Review Committee that recognise the rhetoric from the Defence Minister and others. If they really believe it's as dangerous a world as it is, and I think it is then they have to match that rhetoric with reality.
JOURNALIST: In terms of the counting tricks, in terms of mucking around with numbers, and anyone one that still knows how this works, is it your view that they're giving this to try and find some way of prettying up the books given they are sitting on a $1.3bn deficit.
PATERSON: I think they're doing this because Richard Marles has fronted up to the Expenditure Review Committee year, after year, after year. He's asked for more money year, after year, after year, and he's walked away empty-handed more years than not. And to dress up a win for Richard Marles so he can claim increased defence spending they've gone to accounting tricks. They've gone into accounting tricks by claiming to spend more than they actually are and they've gone into accounting tricks by changing the methodology of how we measure defence spending, changing to NATO rules which we've never used before and counting things like military pensions towards our defence expenditure. But just counting the same things we've always spent differently in the budget doesn't deliver any increased defence capability and that's the problem we have right now.
JOURNALIST: Where do you think we can fill this gap that we now have to get to that 53 billion and beyond? Where do think? Any ideas on where that might be?
PATERSON: Well, I'm quite supportive of harnessing private sector finance in the defence portfolio. I think it could be appropriate, particularly for defence infrastructure - places like Henderson and Osborne which are going to be critical shipyards for AUKUS and other naval construction. But that is not a substitute to governments making difficult decisions around the ERC table to fund defence adequately from consolidated revenue. We are a country where we have a defence force that is funded by taxpayers, it's not funded by the private sector, it is not funded by private equity. And we need the government to make tough decisions to prioritise defence, consistent with their rhetoric.
JOURNALIST: Former Liberal Treasurer, Joe Hockey, said at the Press Club earlier this week for the first time he's a bit concerned about the delivery of the AUKUS submarines. Do you agree with him and share that concern and what do you think that would mean for Australia if that deadline was pushed out?
PATERSON: I am an AUKUS true believer and there can be no Plan B to AUKUS, we have to stick with Plan A, we have to make sure it succeeds. If Australia did not receive Virginia-class submarines and if we're not able to acquire SSN AUKUS after that, then we would be much less safe as a country. But I think we have recognise there are challenges to the delivery of AUKUS on the timeline that we hope that it will and we have to plan for those contingencies. And that's why I've advocated for supplementary capabilities, potentially something like a B-21 Raider, a stealth bomber that has a long-range strike that could supplement AUKUS. It's not a replacement for AUKUS, but it would fill a potential capability gap if it emerges, and it would work in tandem with AUKUS if we secured it.
JOURNALIST: Can we ask a few questions about CGT?
PATERSON: Yes, please.
JOURNALIST: There's a couple that are in my mind. firstly, having had some involvement in consultation with governments over the years through previous experience. My general understanding is governments tend to do better when they talk with stakeholders on board earlier before they make a controversial judgement. Why do you think the handling of the budget and contentious measures has been such a cost?
PATERSON: Well Jim Chalmers has got this completely backwards. You consult people before you legislate, not afterwards. You consult through a proper parliamentary process, not outside it. What the government needs to do is stop, recognise the damage they are doing to our economy, hear the voices across the political spectrum, including two state Labor Premiers, who are saying these tax changes will make Australians worse off, and reassess their entire plan. Because as it is, it’s going to do serious harm to our country, to small business, to young people trying to save for a home.
JOURNALIST: What harm does this do when we observe this in an environment where there is a decreasing trust in institutions. Does this further evoke trust in the institutions like the parliament?
PATERSON: I'm concerned about the economic harm it will do, the harm it'll do to young people in the small business, to mining industries, as we've heard, to farmers, to others. But I am also concerned this will be utterly corrosive to our political system. Anthony Albanese has said he's changed his mind. He has changed he's mind on Capital Gains Tax. He has changed his mind on negative gearing. He has changed mind on trusts. He previously changed his mind on superannuation. He previously changes his mind on stage three tax cuts. What's to say after the next election he doesn't change his mind on death duties? What's it to say he doesn't change his mind on grandfathering these changes, like negative gearing? There is no guarantee with Anthony Albanese anymore that his word is his bond, that he's unwilling to say one thing before an election and do something very different afterwards. And I think that is a breach of trust that undermines faith in our political system. I'm going to take just one more question.
JOURNALIST: Have you or any of your Opposition Senate colleagues had conversations with the Greens about either forcing an inquiry or trying to block this bill, have you had any conversation?
PATERSON: Yes, we have openly appealed to the Greens to work with us, whether they agree with the merits of what the government is doing or not, to facilitate proper parliamentary process. The Greens should not be part of a grubby deal that shuts the door on parliamentary process. Australians have a right to be heard through a Senate committee inquiry that properly looks at this very complex legislation and I really hope the Greens do the right thing by the Parliament, allow the Senate to do its job and have an adequate inquiry into these very complex and consequential changes.
Thanks everyone.
ENDS