Speech: Business News Breakfast




Wednesday, 2 November 2022


Good morning, everyone.

Thank you for coming along to this Business News breakfast. It’s good to be with you—in conversation about the national issues that matter to Australian business and society.

Can I thank the Business News team—Elton Swarts, Charles Kobelke, Sean Cowan and Gary Adshead for bringing this event together. And for publishing such a handsome, colourful magazine every fortnight.

It’s a reminder that there is a market for print journalism that brings together people around an offering of quality writing, engaging news and superb presentation. I’m grateful for the opportunity to speak to your network today. 

Some of the greatest literary minds of the twentieth century were shaped by their service in the First World War. We’ve all heard of J.R.R Tolkien and C.S. Lewis: Oxford dons, close friends, and members of the Inklings—an informal group of writers that met regularly at the Eagle and Child pub in Oxford to discuss literature and epic fantasy.

Tolkien is famous for the Lord of the Rings trilogy, and The Hobbit, and Lewis for the Chronicles of Narnia. Both men saw war up close: the mud, death and waste. Their young minds imprinted by the destruction of a vanished world they once knew.

The war touched them physically, too. Tolkien with trench fever, Lewis with shrapnel wounds.

Both were invalided back home to England where, in the still of convalescence, they mourned close friends killed on the Western Front. From this came some of the greatest works of literature of the last century.

Tolkien wrote the Lord of the Rings between 1937–1954. Undeniably its themes were shaped by his wartime service and the turmoil of the Second World War and the Cold War that followed.

On publication in 1954, many were quick to identify the Ring with atomic weapons and Mordor with the Soviet Union. Was Sauron, the dark ruler of Mordor who desired to rule supreme over Middle Earth, just a stand in for Joseph Stalin?

Lewis dealt with these questions in his review of the first two books, noting that Tolkien started well before the atom was split and while Nazi Germany was Europe’s greatest scourge, ahead of the USSR at the time.

Instead, the real power of the Lord of the Rings is as Lewis wrote, the way, and I quote: “…it teaches us that Sauron is eternal; the war of the Ring is only one of a thousand wars against him. Every time we shall be wise to fear his ultimate victory, after which there will be ‘no more songs.’ Again and again we shall have good evidence that ‘the wind is setting East, and the withering of all woods may be drawing near.’ Every time we win we shall know that our victory is impermanent.

If we insist on asking for the moral of the story, that is the moral: a recall from facile optimism and wailing pessimism alike, to that hard, yet not quite desperate, insight into Man’s unchanging predicament by which heroic ages have lived.”

They lived in gloomy times, yet the message of the story is hopeful. It’s a story that speaks to us. Our modern celebration of Tolkien clearly shows there is a market for hope. As we too live in gloomy times.

Today at home, there is incredible pressure on our society and our economy. Inflation is on the rise, with interest rates hot on its heels—along with the price of electricity, fuel and groceries. The cost of living rises with little relief in sight.

Everything is going up except wages. The question at every level is whether we can afford what we need.

Abroad, the war in Ukraine burns away, no closer to the end than when it started, and now the spectre of nuclear attack looms over Europe like a dark cloud.

Closer to home, the People’s Republic of China concluded its 20th Communist Party Congress last month, with President Xi consolidating his absolute power and control over the Party and the people.

It caps a turbulent year thus far—if not a successful one, for authoritarian regimes—where Xi and Putin remain committed to their no-limits partnership;

Russia brutally seized parts of Ukraine; Chinese rockets streaked across the skies of Taiwan; and Chinese influence has projected deep into the Pacific Island Chain, ensnaring the heart of at least one national leader.

The Sogavare-Beijing Security Pact is a startling reminder that there is a growing geopolitical contest taking place on our front doorstep.

And, if you’re an observer of Western democracies, we don’t seem to be faring all that well—with the United Kingdom now onto their third Prime Minister in four months. You’d be right to wonder about the resilience of our democratic institutions in these times.

But as tough as the situation might be at present, I remain—at heart—cautiously hopeful. I’m a student of history and I appreciate that there is nothing new under the sun—especially political breakfast speeches!

Every problem that we have before us has been faced by a previous generation in one form or another. That’s the message in Lord of the Rings. As C.S. Lewis wrote of its literary power: “...here are beauties which pierce like swords or burn like cold iron; here is a book that will break your heart.”

History and literature, at its best, remind us of the realities of life and keep us from facile optimism or its wailing pessimism. They keep us grounded.

Our times are different, but we are dealing with people, and human nature has not changed through the centuries.

What matters are the virtues: courage, prudence, leadership, perseverance and—to quote Tolkien himself—great deeds that are not wholly in vain.

For Australia and the region, the future is neither orderly nor inevitable—we still have agency and judgment here. Western Australia is uniquely sensitive to the geopolitical pressures of the moment for we draw much of our wealth from trade with China. A disturbance in our region could well compromise the prosperity of families and communities across our great state.

But we also understand our vulnerability. It was only 80 years ago, that WA was attacked 12 times and in one attack, in Broome, 88 people died.

We can chart a safe course through the challenges ahead with prudent leadership, but it won’t be easy for there are dangerous shoals ahead.

The former US Commander of the Indo-Pacific, Admiral Phil Davidson, sounded the ship’s klaxon 18 months ago when he warned that China may attempt to take Taiwan by force within six years, by 2027. That’s now 4½ years away.

US Secretary of State Blinken recently said that “Beijing was determined to pursue reunification on a much faster timeline.” Only in the last fortnight, Chief of US Naval Operations Admiral Mike Gilday said China could move on Taiwan as early as this year, or next.

The window is closing fast. These are considered words. We must take them seriously. We won’t have nuclear submarines in the water by 2027. So how are we hedging against the risk of conflict arriving sooner rather than later? That’s what Stephen Smith and Sir Angus Houston are now considering in the Defence Strategic Review.

I don’t want to discuss particulars here today except to make clear that we need to build strike capabilities that can hold an adversary at risk beyond the archipelago to our north. Strike bombers; precision guided missiles; and, unmanned autonomous vehicles—in the skies and in the seas below.

The Review will report in March, and I understand an interim report is being provided to Government this week.

I remain hopeful for good outcomes, but I must say that last week’s Budget, and the message it sent on defence, does not inspire confidence.

Inflation has depleted defence purchasing power, and portfolio spending has taken a hit in real terms of $2.8 billion dollars. If we are serious about the strategic challenges and the capabilities we need, we must have an honest conversation about what we need to spend—and it must be well above 2% of GDP.

We have a moral obligation to the Australian people to build and maintain a strong deterrent to any regional aggressor. To show that there is a great cost for any unilateral military adventurism. It is simply responsible national security, and it is what Australians expect.

The lesson of Ukraine and its lion-hearted defence is that we must first be prepared and able to defend ourselves if we expect the support of our allies and neighbours.

Even in war, people like to back a winner and we need to be able to punch back, if, God forbid, we must wait for support from our friends.

Given the stakes, the Coalition will always work constructively with the Government to build a strong and capable Australian Defence Force and oppose anyone who hinders that sacred work. To that end, I want to focus on how we find, recruit, and keep the young men and women that we need to build the Defence Force of the next two decades.

The Albanese government has committed to the former Coalition government’s objective of growing the ADF by 18,500 people by 2040. That’s net growth of 1,000 people per year, noting that in recent years recruitment has only slightly exceeded departures from the ADF. You all know how tough the job market is right now. Defence over the past few years has only managed net growth of 300 people, so this is a huge task—especially with an ageing population and a declining fertility replacement rate. So apart from migration and having more babies, let’s first consider the next generation of Australians we are looking to recruit: generations Z and Alpha.

Generation Z are the group born between 1995 and 2009, and Generation Alpha are born from 2009 onwards. They are digital natives, visual learners, born into the age of autonomous vehicles and big data. By 2030, together they are projected to comprise 45% of the workforce.

They will share many of the characteristics of my generation—Gen Y, those of us born between 1980–1994. According to research, we value personal life and family above salary. We value diverse experiences. We like more control over our career paths. We leave jobs and careers at a much higher rate than Baby Boomers. We don’t like hierarchy, inflexibility and bureaucracy in our personal life or jobs (but who ever has really?).

In short, this looks like a tough assignment for a Defence recruiter pitching for an organisation that is often inflexible, inherently hierarchical, sometimes tough on family life, and demands the subordination of self to the team and the mission. All that is necessary because, in the end, serving in the ADF is more than just a job. In fact, the profession of arms is a unique calling, where you may be called upon to use lethal force, and lay down your life, in the defence of your country.

Thankfully, Gen Y has been responsive and drawn to the call of public service. I joined the ADF after 9/11 and now serve in the Parliament. In fact, we have a good number of veterans, including from Afghanistan, among the Coalition in Canberra.

Back to the question: how do we find and keep 18,500 young Australians in the ADF? How do we recruit, retain, and weave a new generation of sailors, soldiers and airmen into the fabric of our proud national story?

First, we need a message that appeals to young hearts and minds searching for purpose. Emphasising the service ethos is critical. Duty, honour and country. They may seem antiquated, but they are values and principles that call people to stand and fight for something bigger than themselves. Aren’t these values we would all want to see in our employees?

But watch an ADF recruitment ad online today: you might think joining the ADF was simply a vehicle for self-actualisation. Sure, there are benefits to service, but we are going to need something more than self-interest if we are going to net grow the force by 1,000 per year.

Kids are waiting to be inspired and challenged by traditional values of service to country, and to their fellow Australians.

Is it any wonder that some defence and national security businesses have taken their names from Lord of the Rings? Strider (Strategic Intelligence for a New Era);

Palantir (Cognitive Technology that enables Decision Intelligence) and Anduril (Solutions for the software-defined conflicts of tomorrow). Values and culture matters. They matter to young Australians.

So, what are we doing today to prepare them to for the force of tomorrow?

Second, we must make onboarding faster. Last year as Assistant Minister for Defence, I discovered that it took 292 days from first contact to recruit training. The Australian Public Service was achieving the same milestone in less than half the time, at around 140 days—which is still a long time.

Far too much time is wasted; we need to accelerate the process or good people will be lost to other sectors of the economy, like yours! I know many here can get it done much faster than Defence.

Third, we need to remove barriers to service—often bureaucratic ones imposed by risk averse gatekeepers. I’ve met and heard from too many kids who get turned away because they’ve had a shoulder injury from footy, a food allergy or were medicated for ADHD in their childhood. All talented kids, motivated and open to grow—yet turned away because of risk culture. Not every job of the future requires the fitness of a fighter pilot or the endurance of an infantry soldier.

We need to move beyond the one-size-fits-all model and select kids who might not tick all the boxes but who can get the job done, and then some.

Fourth, we need to do a better job of keeping people in the ADF, by giving them opportunities to study at a civilian university mid-career or perhaps take a posting in the private sector, where they might learn logistics, entrepreneurial skills, data analytics or leadership in a different setting. Incentives for home ownership are important, especially for a generation that feels locked out of the housing market in most of our major capital cities. The job market is more dynamic and so the ADF must increase its permeability—by allowing movement in and out of the system without penalising those who chose to broaden their work experience.

We need more pathways to return to uniform, not just pathways out.

Finally, we need to continually think about how we look after our serving families. Many of you in the resources sector understand the cost of the FIFO lifestyle to families. Defence shares the same challenge: operations, career courses and exercises take time away from the family. There are ways we can economise.

COVID has demonstrated that we can achieve a lot through online learning, which may well save on travel and time away, particularly for ADF career courses—which can often be quite onerous on top of other work-related travel.

We must balance the benefits of bringing people together with managing the risks of keeping families apart. We cannot ignore or minimise the cost to wellbeing, productivity and commitment that relationship breakdown can have on personnel and their families.

It’s going to be a busy decade ahead. There is much to be done. Industry has a massive role to play in building our defence force and national resilience.

I hope this is the start of an ongoing conversation. Thank you for listening this morning and I look forward to your questions.