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April 17, 2026
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LAURA JAYES: Let's go live to James Paterson now as the Shadow Defence Minister. James, thank you for your time. Overall, is this a bipartisan defence strategy?
SENATOR JAMES PATERSON: I think the broad strategic direction of defence policy is bipartisan. We all support the US alliance, we all support AUKUS, we all need to do more to be more resilient and to be able to defend ourselves. But there is a very big divergence when it comes to spending, and particularly the pace of the increase of spending. We've been clear that you should listen to the best-informed experts in Australia, people like Sir Angus Houston and Professor Peter Dean, who helped contribute to the Defence Strategic Review of the Albanese government, who have both since said we must increase defence spending to 3% of GDP. And when they said that, they didn't mean reclassifying existing spending on things like military pensions to pretend we're spending 3% of GDP on defence capability, they meant actually increasing defence spending on defence capability. But that's exactly what the Albanese government did yesterday. They made a fairly significant change to how we measure defence spending, and they included lots of things that we haven't historically included in the defence measure to make it look a lot better on paper. But that accounting trick doesn't make us any safer, and it doesn't put a weapon in the hands of a warfighter, it doesn't buy a ship, it doesn't buy a drone, it doesn't buy a missile.
LAURA JAYES: So would it include things like veteran pensions, things like that?
SENATOR JAMES PATERSON: That's right. Veteran pensions, some proportion of policing, some proportion of intelligence. None of this was disclosed by the Deputy Prime Minister in his speech at the press club yesterday. It is not explained in any detail in the National Defence Strategy or the Integrated Investment Plan. This is about 200 pages of documentation that was released yesterday, and they only mention this change in a single sentence, and they did not explain any of the workings behind it. It's now not clear how much of the increase between now and the early 2030s is going to be attributable to actual increases in defence spending, or is it just increases in military pensions and other non-core defence spending?
LAURA JAYES: What do we need? We're always talking about, you know, numbers that boggle the mind that ordinary Australians can barely get their head around in terms of the billions of dollars that is needed to spend on defence. But what do we need to spend this money on when you're talking about 3% of GDP or 3.5%? Where does the money need to be spent, or is part of this, James, not wanting to upset Donald Trump and America and wanting to at least show them on paper? That we're near where they want us to be.
SENATOR JAMES PATERSON: I don't think we should increase defence spending because Donald Trump has asked us to do so. I think we shouldn't increase defence spending because it's in our own national interest and our own best informed experts think we need to. And there are two reasons why we need to increase defence spending. One is some of those specific things we could spend it on, which I'm happy to take you through in a minute. But the other reason is because we're trying to deliver AUKUS with essentially the same defence budget that we've had for years, which is roughly 2% of GDP in actual defence spending outlays. And AUKUS is an expensive project. So, the only way you can deliver AUKUS, which is a future capability which will arrive in the future, is by cannibalising other elements of the ADF - unless you're willing to increase defence spending. And this government hasn't increased defence spending sufficiently to avoid those cuts to other services. That's why we've seen infantry fighting vehicles, self-propelled howitzers, hunter-class frigates, F-35s, military satellites, all of these things cut. I mean, it has got so bad, they've even told reservists, you can no longer do 200 days of service a year. It's been reduced to 150 days. Now, none of those cuts would be necessary if they were willing to fund defence adequately.
LAURA JAYES: Why aren't we talking more about AI in this space? I mean, this war should give us that lesson, shouldn't it? There is this whole hoo-ha with Anthropic. Let's put that aside for a moment, whether it's OpenAI or Anthropic or even our own AI company, which I don't think anyone is capable of doing this. This has become a really important weapon of war. Are we actively seeking a contract with these AI companies?
SENATOR JAMES PATERSON: You're right, Laura. It has been a very significant feature of the US and Israeli campaign against Iran, and it's particularly been utilised in identifying targets very quickly and processing them for approval by humans in a way that could never have been done previously, or at least not done as quickly as it has been. The reason why the US and Israel have been able to have such a high tempo of activity, strike so many targets continuously, is that those targets keep getting identified using AI tools and then assessed. And Australia does need to play in this space. We do need to have this technology.
LAURA JAYES: Do you know if it's happening?
SENATOR JAMES PATERSON: Well, I just want to be cautious because I haven't been briefed on the details, and I shouldn't publicly speculate. There certainly are lots of AI companies that visit Australia that offer these services. The extent to which it is being used by the ADF right now, I don't know.
LAURA JAYES: Okay, but I mean, we see this, the Department of War and Pete Hegseth has said that, you know, has deemed Anthropic a supply chain risk because they wanted to pull out the human element in using AI. Then OpenAI jumped in. Should Australia, and I don't know what you've been briefed on, but if we could speak, you know, on a macro level, should we be trying to get a contract or deal with Anthropic?
SENATOR JAMES PATERSON: Well, it's not appropriate for an opposition shadow minister to say, we should be dealing with this company or that company. I don't think I can run a procurement process from opposition. That'd be irresponsible. But the principle I'm very happy to talk about, we should be using these tools. They are the future of warfare, not even the future warfare, they are the reality of warfare right now. And we know that our potential adversaries, countries like China, Iran and Russia, do use these technologies and have used these technologies. And we know our allies, like Israel and the United States, have used them too. So if we are not deploying them extensively within the ADF, then we should. One area I'm more familiar with is in the cyber security space because I have been extensively briefed in my previous portfolio. And agencies like the Australian Signals Directorate do use it extensively in the cyber realm, and that's a very welcome thing. Some of our other intelligence agencies also use it in a limited way.
LAURA JAYES: Yeah, there's a lot of talk about Mythos, the latest version out of Anthropic. But I won't bore you with that. Maybe we can talk about it another time. And I do appreciate that when you're using AI, there does need to be a level of secrecy when it's used for things like intelligence and war. But I finally want to ask you, James, about the comments that Donald Trump made again, saying that he was not happy with Australia. Anthony Albanese says there's been no formal request for help. Do you believe him?
SENATOR JAMES PATERSON: I can only take our own government, the Australian government, at their word.
LAURA JAYES: Surely he wouldn't be lying about that?
SENATOR JAMES PATERSON: I wouldn't think so. I would certainly hope not. It would be a reckless thing to do. And the government has repeatedly said there's been no official request from the United States. But clearly, the President has a different understanding of that. And it is not a good thing in our most important security alliance that there is a difference of understanding, a public difference of understanding, between the US President and the Australian government. And the question I have is, what steps has the Australian government and the Prime Minister taken to resolve this? Has the Prime Minister spoken to the President about this? Has he asked him why he keeps making these statements repeatedly publicly? Because I think it needs to be better managed than it is. I note that we don't currently have an ambassador in Washington, D.C. Greg Moriarty, the former defence secretary, has been appointed to fill Kevin Rudd's vacancy. Kevin Rudd has left, as I understand, the Embassy. Greg Moriarty, he was there yesterday at the National Press Club in Canberra. He hasn't gone over there. This is not a great time not to have a full-time senior ambassador. I'm sure there's an acting person in place who's a very diligent public servant and well-qualified, but this is our most important relationship. It is not the time to have a vacancy in the Ambassador's office.
LAURA JAYES: What is the state of our relationship, and do you agree that this is perhaps the most difficult president that we have had to deal with in modern times or administration, given just in the last 24 hours? We've had JD Vance warning the Pope about talking about theology, we've had Pete Hegseth quoting Samuel L. Jackson out of Pulp Fiction, and just a couple of days ago, Donald Trump putting out an AI picture of him as Jesus. Makes it pretty hard for us, doesn't it?
SENATOR JAMES PATERSON: I think the fundamentals of the Australia-US alliance are incredibly sound, and we are well integrated in the intelligence and military domains. We have an extremely deep economic relationship. We have an extremely good political relationship, not just at the executive level, but through Congress and other branches of the US government. Obviously, though, this is an unconventional US administration. President Trump is unlike his predecessors, and his administration operates in an unconventional way. But an alliance has to be far more fundamental and more deeply rooted than just the personalities of the day that are in the Oval Office. Now, President Trump has three more years on his term. He'll be replaced by another president in due course who will be their own person and have their own worldview. But the fundamental interests of the United States are anchored in having a good relationship with Australia. We contribute things to the US alliance that no other US partner can contribute to them. And we also benefit, obviously, enormously from the US alliance. So I think our interests are aligned. I think values are aligned, and I think we should be able to manage if there are unconventional personalities in place from time to time.
LAURA JAYES: In the meantime, we all just hold on. James, thanks so much for your time, as always. See you soon.
SENATOR JAMES PATERSON: Thanks, Laura. Cheers.
ENDS