A suppressed auditor general’s report warned that the government’s $1.3bn deal to buy a new combat vehicle fleet was not value for money, newly released material shows.
In 2018, the attorney general, Christian Porter, deployed rarely used powers to suppress parts of an auditor general’s report that criticised the purchase of a new combat vehicle fleet, the Hawkei, manufactured by multinational arms giant Thales.
The Guardian revealed in 2018 that, in the redacted parts of the report, the auditor general had suggested the government could have spent half the amount if it had chosen to join the US joint light tactical vehicle (JLTV) program, instead of purchasing the Hawkei.
Thales was furious at the auditor’s finding, believing it could threaten its ability to market the Hawkei abroad. The arms manufacturer lobbied Porter to intervene and remove references comparing the JLTV and the Hawkei in January 2018.
Porter did so by using largely unprecedented powers that allow him to suppress audit reports, including on grounds of national security and commercial prejudice.
In the almost three years since, the independent senator Rex Patrick has used freedom of information laws in an attempt to secure the full unredacted report. He won his protracted battle in the administrative appeals tribunal last month, and a less redacted version of the report has now been released.
The newly unredacted findings largely reflect what was revealed by the Guardian in 2018: that the auditor found Australia could have saved money by going with the JLTV program instead of the Hawkei.
One suppressed part of the report found that:
“Defence has not clearly demonstrated that the acquisition provides value for money, as it did not undertake robust benchmarking in the context of a sole source procurement.”
The redacted parts of the report detail a cost comparison between the JLTV and the Hawkei. One part finds the JLTV would have been significantly cheaper than previously suggested to the government in 2015 advice.
“Although only one element of assessing overall value for money, the ANAO’s high-level cost-comparison indicates that the cost of the Hawkei capability exceeds the 23 per cent price difference advised to the government in 2015,” one previously redacted part of the report said.
Thales has always argued the cost comparison is deeply flawed and unfair, because it seeks to compare two vastly different vehicles and fails to take into account the benefits of local manufacturing brought by the Hawkei.
The government has continued to resist the publication of the unredacted report because it fears it would hamper Thales’ efforts to export the Hawkei abroad.
The case prompted criticism in 2018 because it was widely seen as a threat to the independence of the auditor general’s office, one of the key accountability bodies in the country.
Patrick said the government must now explain why it thought it was appropriate to redact the report on national security grounds.
“I’m just astounded at what the attorney thought was security sensitive,” he said on Saturday.
“I have written to the attorney general insisting he make an explanation to the parliament as to how he completely misjudged national security and issued a certificate under the auditor general’s act to censor the auditor’s findings from the parliament.”
A spokesman for the acting attorney general Peter Dutton said the decision to suppress parts of the report was made “following careful consideration”.
“Balancing the content of the report with the required s.37 security, defence and international relations issues and the issues relating to the commercial interests of relevant parties was the subject of a thorough and considered process conducted strictly in accordance with the act,” the spokesman said.
“It is important to note that the relevant auditor general report is, and has been, publicly available since September 2018, with only a small amount of particular information of the report redacted on these grounds.”
