The Australian government has launched a review of the country's defence procurement activities, following a number of controversial acquisitions including the navy's now-cancelled Kaman Aerospace SH-2G(A) Super Seasprite helicopter deal. The review will also look at the current structure of the Defence Materiel Organisation, which is responsible for Australia's defence purchases, and could lead to the body's separation from the Department of Defence.
© Royal Australian Navy
Currently managing more than A$100 billion ($94 billion) of defence acquisition and sustainment business, the DMO is undergoing reforms following the 2003 Kinnaird review of defence procurement. However, "there have been some high-profile problem projects in the area of defence procurement, and the government is committed to avoiding a repeat of past problems", says parliamentary secretary for defence procurement Greg Combet.
The review will look at progress in implementing the Kinnaird reforms, as well as potential further improvements relating to the effectiveness of the DMO's financial and staff management arrangements.
The process will also study greater use of private sector project management, financial and legal expertise and public-private partnerships, increased use of military and commercial off-the-shelf purchases, and ways of making projects more accountable following so-called "Second Pass" approval. It will also consider how the DMO can continue to develop its commercial approach and "become more business-like in its operations", says the government.
A review team headed by defence procurement advisory board chairman David Mortimer will report to the government within 14 weeks. The process comes as Dr Stephen Gumley is reappointed as DMO chief executive.