Katherine Ziesing | Canberra
ADM: Can you run us through what the design and mobilisation contract entails?
Clark: The design and mobilisation contract is the first in a series of contracts we will have with the Commonwealth for the Future Submarine program. The mobilisation part is about getting the contracting methodology in place and up and running. Neither the Commonwealth or Naval Group have worked together before, so there’s a bit of learning that goes on during this contract. During this time, both parties, are placed in a position where we are to prepare for the future phases of the contract.
There’s some initial design work, some feasibility studies but by and large it’s the production of plans, things like the Australian Industry Capability Plan, the Infrastructure Build Plan, the Project Management Plan, the Engineering Plan, all those kind of plans that we have to produce for the Commonwealth to show them how we’re going to deliver the contract over the next 30 years.
ADM: The Budget papers showed the value of that contract at $935 million, $127 million of which has been spent and $319 million budgeted for this financial year. How is that spread out?
Clark: Over many different phases. We’re in Step Two right now having just completed Step One. And then the next phase is the design contract. That is then further broken up into three separate phases, and those three separate phases are spread over almost five years. These will be a bit of overlap between a couple of these contracts. So when we talk about the budget papers and that large sum of money, that’s actually the sum of money that’s spread over five separate contracts.
ADM: What is the next major milestone you’re aiming for?
Clark: The next major milestone will be completing Step Two of the design mobilisation contract due in October this year, and then the design contract is meant to commence the very next day. We are also currently participating in ongoing negotiations with the Commonwealth over the Strategic Partnership Agreement.
ADM: There has been a lot of speculation around what the Australian workforce profile will look like for the Future Submarine program. Can you give us an overview of how you see it coming together over the life of the program?
Clark: There’s two aspects really with respect to this. There is the creation of the Design Authority within Naval Group Australia. Now you may have heard me mention recently that we’ve commenced the process of hiring seven naval architects who will go to France and become embedded in the design team for about two to three years at our submarine facility in Cherbourg. They’ll be going to France around October/November this year. They’re the first seven.
During their time in Cherbourg they will work with their French counterparts, learning all the necessary requirements in terms of how we do our design; why we design things the way we do so that they can come back to Australia and perform as a credible Design Authority.
We’ll take the Design Authority capability within Naval Group Australia up to about 80 people by about 2023.
One of the things that we’ve been charged to set up within Naval Group Australia is a Design Authority for the Future Submarine. That will be focused on the long term sustainment of the submarines and any modifications that are required.
The other thing of note from a Design Authority perspective is we’re also taking members of the Commonwealth across to learn the same process so the Commonwealth can be an informed customer going forward. That’s part one.
The second part is the ramp up of the resources to build the submarine. In terms of the initial thought processes on the workforce front, we’re at about 40 people within Naval Group Australia. By about the 2028/29 timeframe we’ll be up to about 1,400-1,500 people in terms of the construction workforce. It, as you’d imagine, is the full gamut in terms of an industrial base. That’s when we start building the first submarine.
We’ve got a pretty slow ramp up over the next couple of years. Obviously, because we’re not doing a lot of production activities, we’ve also got to build the infrastructure or assist with the construction of the infrastructure.
At the moment Naval Group in France is producing a preliminary design. Naval Group Australia will prime contract to produce a more detailed design before engaging an Australian design company to assist us with that, with a plan to take them through the entire build of the infrastructure.
The hard point is around the 2021/22 timeframe when we’re due to have the hull and construction hall built, the propulsion test lab built, and the combat system and mitigation lab built for our partners and combat system integrator, Lockheed Martin Australia. And the reason why we’ve got that timeframe is because we intend to start training an Australian workforce on the submarine build techniques.
So from about 2020/21 onwards you’ll start to actually have a production workforce coming into the company and then that will start to accelerate from about 2024 onwards to get to the 1,500/1,600 we’re talking about.
ADM: And that peaks in...?
Clark: About 2029. Of course a lot of this is just a forecast; we’ve got to obviously do the detailed planning on this but our belief is that we’ll get up to that 1,500-1,600 range around 2029. Numbers will probably settle a little bit after that but not much. We’ll probably only come back to around 1,400 as we apply the lessons learned from the first boat. And then we should be pretty much status quo all the way through the construction phase. I don’t envisage our numbers will dramatically drop below that number until such time as we complete the last submarine.
ADM: How long is the total construction phase?
Clark: The first submarine is being built over a three-year period, and that’s quite deliberate to make sure we can transfer the technology and train the Australian workforce. It’s quite a logical and well thought out transfer of technology package we’ve been working on with the Commonwealth.
To start your workforce in 2021, you basically train what will become the supervisors for the rest of the submarines at that time. There will be supplementary French assistance while we construct the first submarine. That’s about a three-year period. Then it’s about a two-year drumbeat for every submarine after that but it’s important to remember there’s overlap for each one.
ADM: What are the expectations of France and the DGA as to how things come together from the French side? What do they hope to get out of this deal?
Clark: That’s a very good question. France is committed to a transfer of technology and exchange of their most secret information to one of their greatest allies – Australia. What France wants or expects to get out of this is for Australia to create a regionally superior submarine and a sovereign Australian industrial capability. That’s what they expect.
ADM: Can you give us some update on how the French Barracuda program is performing at the moment?
Clark: The first thing is the Barracuda program is on track. The overall integration of the first of class – the Suffren – has now passed 80 per cent. There were a few technical difficulties encountered in 2016 during the assembly of critical equipment, due to this being a first-in-series vessel which has resulted in sea trials being pushed back to the end of 2019.
Several important milestones have been achieved on the Suffren:
• installation of the forward and aft batteries;
• fitting of the propeller module;
• final assembly of the submarine, trials under fossil-fuel steam;
• first start-up of the diesel engine for the emergency generator set; and
• installation on board of a dummy missile.
The Suffren will have achieved integration of all of its equipment in the French summer of 2017 and testing will then begin. Sea trials will commence in 2019. The second boat, Duguay Trouin, will follow the Suffren into assembly.
The following submarines will then be delivered: Duguay-Trouin, Tourville, De Grasse, Casabianca and finally Rubis. The final submarine will be delivered in 2029.
ADM: What do you think the future of ASC will look like?
Clark: I can’t comment on the future of ASC. That’s really a matter for Government.
ADM: Will DCNS be involved in the transition between Collins and the Future Submarine in terms of lessons learned and other workforce planning issues?
Clark: In terms of Collins, our involvement with Collins is obviously zero. That’s something for ASC to be looking at. We are certainly developing our relationship with ASC and one of the things that’s important to us is to understand the lessons ASC learnt from the Collins program that may be applicable to the Future Submarine. In terms of the workforce, that’s an area where ourselves and ASC are pretty keen to work on. They’ve obviously got quite a substantial workforce.
One of the commitments we’ve given to the Government is that neither Naval Group nor the Future Submarine will impact on Collins sustainment. I think some of us sometimes forget the only operational submarine Australia has is the Collins and while the Future Submarine is a very exciting program, it will not provide us with operational capability for many years. We’ve got to make sure Collins is at sea and operational.
We’ve got an agreement in place with ASC to communicate on a regular basis, to make sure we’re not taking personnel without ASC’s knowledge. It doesn’t mean that we won’t hire personnel from ASC. What it means is that we sit down and we talk to ASC to make sure they understand so they can plan for any staff members that move across to us.
We’re also working with ASC to understand their workforce projections. We’re sharing our information with ASC because the reality here is we want to have a very smooth transition from a Future Submarine perspective.
I think people sometimes forget that there are other maritime programs happening in South Australia. You’ve got Sea 5000 which is going to have a large workforce; you’ve got the OPVs in that mix; you’ve got Collins sustainment; you’re going to have the life of type extension for a couple of Collins class submarines that will need to be taken into account; and you’ve got a Future Submarine workforce that’s going to be growing.
It’s an all of industry endeavour, it’s not just a Naval Group endeavour and it’s not just an ASC endeavour. It really requires all of industry and government to be involved to ensure that the capability is there.
ADM: Do you think there is an enterprise-wide approach when it comes to the workforce among all the maritime programs?
Clark: Today, we probably haven’t got there because we don’t know who the successful party is going to be for Sea 5000. Once that’s announced we’d be very keen to sit down and have a conversation with them about this issue. Equally we’re very keen to ensure that the trade union movement is brought on board. They’re an important stakeholder in all of this.
I think it needs to be very much a government led activity because ultimately you’re talking about the operational capability of the Royal Australian Navy. This is fundamentally what we’re talking about. We want to make sure that there is a workforce in place, that all parties have some level of synergy in terms of how they go forward; we don’t want to create the situation where we’re robbing Peter to pay Paul in terms of resources.
We’ve got to have a mature, logical way of dealing with that and that’s where other stakeholders, such as the trade union movement, but also the education facilities, the TAFEs, the schools, the universities, come into play.
It’s a very big endeavour and the shipbuilding college the Government is talking about establishing in terms of producing resources for that whole basin that’s going to exist at Osborne; all of that needs to work together to happen.
ADM: Obviously national shipbuilding is an Australia-wide endeavour and you’re centred around Adelaide. What other parts of the Australian economy will benefit from a DCNS build of the Future Submarine?
Clark: I’ve said this at many of our future submarine industry forums, so I commend you on your question. It is a national endeavour and I have said many times that we don’t care where we get Australian industry capability from, whether that be in Queensland, Darwin, Victoria, or Western Australia, it doesn’t worry us. Our aim is to get the best companies into our supply chain.
You’re right that it’s going to be centred in Adelaide, as that’s where the submarine construction facility will be. But in terms of being able to take capability from anywhere in Australia, that’s not a problem to us. We don’t envisage that every supplier is going to be found in South Australia. Equally, we don’t have a preference. We’re quite happy to take industrial capability from anywhere as long as they meet the standards we need in order to build Australia’s Future Submarine.