What Budget 2024 means for Defence

Defence funding is set to experience a significant delay in substantial increases, with an anticipated shortfall of 5000 personnel. While an additional $5.7 billion is earmarked for the upcoming years, the majority, $3.8 billion, won’t be accessible until 2027-28. Despite government alerts regarding Australia’s strategic challenges, defence expenditure will gradually climb to $67.4 billion by 2027-28, reaching 2.12% of GDP.

Committing to bolstering defence capabilities, the government has pledged $50.3 billion in supplementary funding by 2033-34, with the aim of surpassing $100 billion in annual expenditure, equivalent to 2.3% of GDP.

Concurrently, Australia intends to amplify its assistance for overseas conflicts, such as those in Ukraine and the Middle East, with an additional $144 million allocated over a two-year period. This includes furnishing military equipment to Ukraine and extending duty-free access to bolster its economy until July 2026.

The Budget has outlined several initiatives for the 2024-25 fiscal year, including:

• Setting aside $17.5 million to institute a new Parliamentary Joint Committee on Defence, enhancing parliamentary oversight and comprehension of Defence’s pivotal role in navigating Australia’s complex strategic landscape.
• Committing $166.2 million over the span of five years starting from 2023-24 in grants to fortify small and medium-sized businesses and local defence industries, integral components of the Defence Industry Development Strategy.
• Dedication of $28 million spanning from 2024-25 to 2027-28 for the implementation of reforms pursuant to the Defence Trade Controls Amendment Act 2024, aimed at fostering industry engagement and streamlining trade between AUKUS partners.
• Investing $81.9 million into the defence industry to fortify critical job roles, including provisions for scholarships, enticing and enrolling apprentices via the Shipbuilding Employment Pathways Initiative, support for supply chains, and augmenting the defence industrial workforce.
• Allocating $232.3 million for international military support and assistance endeavours from 2023-24 to 2024-25, including an additional $144.3 million earmarked for military support to Ukraine.

Minister for Defence Industry, Pat Conroy, underscored, “In revitalising the IIP, the Government is delivering the capabilities necessary for the ADF to safeguard Australians, while concurrently strengthening our sovereign defence industry to cultivate jobs and nurture a future shaped by Australia.”