Budget 2018: Three key benefits for the Australian Defence industry

The Budget has revealed defence spending will total $36.4 billion this year with the government claiming it is on track to meet the 2020-21 investment target of 2% of GDP into the sector.

Over the last year we have seen the government launch a number of key initiatives to drive jobs growth and create a sustainable and internationally competitive Defence industry. Australia’s Defence Export Strategy and the recent appointment of David Johnston as Australia’s first Defence Export Advocate have been key in helping grow Australian exports. Earlier this week the government announced the first Defence Industry and Innovation Programs Update Report showing the success of initiatives including the Centre for Defence Industry Capability (CDIC) towards advancing Defence’s capability and growing Australian industry.

While there have been no major surprises for Defence from the Budget, the government’s investment over the last 12 months have created three clear benefits for the Australian Defence sector.

1. Stimulates local R&D and innovation

The availability of funding, especially for defence SMEs and start-ups, will help drive new technology development on our home soil, including intelligent automation such as AI, machine learning, and bots. Late last year the government announced a $50 million investment into the formation of the first Defence Cooperative Research Centre (CRC) for Trusted Autonomous Systems centre to develop drone and robotics technology for the Defence Force. Looking further ahead, the Budget reads: “The Government will provide $26 million to establish a national space agency to drive investment, create jobs and continue Australia’s participation in the global space economy”.

2. Support for Science, Technology, Engineering, Mathematics (STEM) skills

With advanced technological developments across the industry we need the skills to not only support this, but to also drive job growth across the sector. STEM programs will be key to upskilling our current workforce and future proofing the next generation of people entering the industry – from engineers to on the ground combat personnel. The Budget is providing $4.5 million over four years to encourage more women to pursue STEM education and careers. We are also expecting to see the release of the defence industry skilling and STEM strategy later in the year.

3. Drives collaboration across Australia

The government has committed to $200 billion to build up the capability of our military over the next 10 years. In addition to supporting jobs growth, this level of investment is driving a more collaborative mindset across states and territories towards the same goal: increasing the defence industry’s contribution to Australia’s overall economic growth. Initiatives like the Defence Innovation Hub provides funding and working with businesses, academia, and industry, to help make sure technology can be matured in a collaborative way.


The federal budget is a positive step towards a more profitable defence sector that will place Australia on the international stage for its defence capabilities. It’s up to the industry now to collaborate on initiatives such as STEM programs and R&D to ensure we can maximise the opportunities and generate sustainable economic growth in Australia.

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