Australia’s defence budget ‘cannibalised’ amid $86 billion funding shortfall

Added: 2026-05-28

[00:00:00]Let's turn our attention now to this report this morning. A remarkable report saying Australia is $86 billion short in critical defense funding. Now, this is the annual ASPI strategic policy warning in its cost of defense report. Uh they say capability is being sacrificed to pay for Orcus. Joining me now, someone who knows this area extremely well, Chris Kenny, regular former foreign minister Alexander Downer. I'm not sure the ASPI report, Alexander, would surprise you all that much.

[00:00:33]>> Uh, no it doesn't. I think the ASPI report is dead right. I mean, basically the defense bud budget is being cannibalized uh in order to pay for ORCUS rather than the Orcus expend expenditure being augmented. Um and so as a result our uh defense capabilities today are gradually declining. For example, we were unable to send a ship um a warship to the Gulf of uh to the straight of Hormuz because our ships wouldn't be able to defend themselves from Iranian drones and missiles. I mean that reflects the weakness of our defense force where we haven't invested in recent times in key capabilities. So the um ASPI report is dead right.

[00:01:30]The government keeps telling us no no nothing to see here. We're spending lots of money. Uh Senator Patterson uh James Patterson was on Sky this morning. Have a listen to what he had to say about that. Richard Miles has been claiming that this government is going to invest $53 billion in defense over the next decade. It turns out the government hasn't actually decided to do that. It is all spin. It is no substance and it's no delivery and it doesn't make our men and women in uniform or our country any safer.

[00:01:57]>> There is a lot of spin going on, isn't there, behind the scenes?

[00:02:01]>> Um, well, there's a lot of manipulating manipulation of the of budget to tell you the truth. So for a for a start they've incorporated into the defense budget expenditure on things like uh superanuation payments to former defense personnel uh which wasn't included in the defense estimates before. Um so that inflates the defense budget so they can claim they're increasing spending on def on defense. And secondly, um they're making assumptions about private sector investment in defense, uh which they're also incorporating into their estimates of increased defense spending. So they're playing with numbers but um as Aspie points out and others have pointed out as well uh the real expenditure on improving defense capabilities um the effectiveness of our defense force uh it's negligible and it's very sad to see um a government in Australia being so complacent about defense at such a uh unstable time in international relations. questions.

[00:03:19]>> Well, as you say, we're in a very dangerous situation at the moment. I mean, not the least being uh the conflict in the Middle East. I I note President Donald Trump today flanked by Pete Heskith, the the minister for war, and he also had Marco Rubio with him. He said, "I was never going to do a dud deal with Iran." And I presume he's he's referring to the Iranians have come back saying, "Okay, we'll do a deal on that, but you need to give us this and that."

[00:03:46]Where do you see this being at at the moment given there's been fresh strikes by the US on Iran and also uh Israel has gone back into southern Lebanon.

[00:03:57]Well, uh the Americans have attacked um uh the Iranians boats that were laying mines in the straight of Hummus. So it's understandable if they Iranians start laying mines um that that is an act of war in and of itself. So they're in breach of the ceasefire by doing that.

[00:04:19]So the Americans are entirely justified to attack them. Look, ultimately Iran's economy and particularly the IRGC who are such beneficiaries of any economic wealth in Iran, Iran's economy can't survive for as long as they're unable to export their oil. Um, and the e oil exports have diminished to negligible levels because of the American blockade of their ports in the uh in the Persian Gulf. So, um, I mean, the Iranians, the Iranians are the people who are suffering the most here and the Americans just need to be patient and hold out. And as for the Israeli attacks in Lebanon, I mean, it's not an Israeli attack on the whole of Lebanon. It's Israeli um Israelis attacking Hezbollah missile sites and storage uh where they've been firing missiles into Israel. So, it's inevitably going to happen um for as long as um uh Hezbollah maintain kinetic activity against Israel.

[00:05:31]Now, it's interesting is if you watch the ABC, I think it was Four Corners on Monday night, Chris showed it on this program, uh you would think there was no war in Iran. People just wandering around the streets living life as if nothing's ever changed. I mean, that was an absolute disgrace.

[00:05:47]I didn't see the program, but um the Iranian people, let's think about the people there, the 90 or so million people in Iran are really suffering as a result of this theocratic regime. And you know, 70 80% of them want to uh get rid of the regime. they they don't have the capacity to rise up against it because the IRGC who are the uh militias who support and uphold the regime have all the guns. Um so anybody who rises up or protests runs the risk of being shot down or hanged in the streets. So um it's a very difficult situation for the Iranian people. And I mean, I think it's really important we sympathize with the Iranian people and recognize we're on their side, not on the side of this militant, brutal theocracy that runs the country.

[00:06:46]>> Good to catch up, Alexander. Thank you very much, Alexander Downer