Ivan Waterfield on the nuclear submarine program and its impact on manufacturing in Newcastle

HunterNet Co-operative CEO Ivan Waterfield spoke with Paul Turton, host of ABC Mornings about the recent announcement of the nuclear submarine program, and how it could have an impact for manufacturing in Newcastle.

Paul Turton: It’s a huge announcement and it’s sending ripples across the oceans and around the globe including, no doubt, into the corridors of power in Beijing.

The Australian, UK and US leaders have just announced a nuclear submarine program worth up to 368 billion dollars. The submarine will be known as the AUKUS class recognising the landmark security pact involving the three countries, and this is a long-term commitment. Not only will US and UK submarines begin rotating through Australia from as early as 2027 but these vessels are to be built for the Royal Australian Navy through the 2040s and 2050s.

Now with this massive project work is expected to come to Australia, so will that include Newcastle? After all we’ve got a long ship-building tradition – or at least we did – so are we even capable of tapping into this opportunity or will it be submerged before our eyes?

Ivan Waterfield is the CEO of local industry organisation HunterNet and he joins me now.

Ivan good morning thanks for coming on.

Ivan Waterfield: Morning Paul.

PT: The details are still coming out of course but this announcement at San Diego, could it have an impact for manufacturing here?

IW: Oh yes, significantly. I mean, we’ve been waiting with anticipation for this announcement, I mean pardon the pun, but I reckon our primes in the industry, in the Hunter, are primed and ready for this.

PT: OK, alright, have we lost sufficient or a substantial amount of our skill base?

IW: No, if you take Forgacs, the old Forgacs out at Tomago, I mean they were taken over by Civmec. Civmec makes it, actually, you know a significant player in that field in Henderson in WA, so they’ve mirrored it in a smaller capacity in Tomago, you know, they’re doing heavy manufacturing now, you know their aim was at some point to to be able to look at can they get back into ship building on the east coast.

PT: They’re complex bits of gear, aren’t they? Of course they’ve got high-tech everything including modern production techniques, what sort of a role could companies in Newcastle play?

IW: Yeah, look we’ve already got that capability and also the facilities you know, big green sheds ready and primed and able to do this. I think having the ability of, you know, three decades worth of opportunity and billions and billions of dollars, that gives the confidence for industry to actually do proper capital investment as well as people investment so we can get ready in the set for this.

PT: Towards the end of the last century the unions forecast the valley of death here in the Hunter Region when it came to ship building. Were they right? Did that in a way become a self-fulfilling prophecy?

IW: Look I think there was a downsizing in terms of people at those facilities, but again you only have to walk around some of them now, they’re there, they’re ready, they’ve already got people operating them. So whether that’s out at Tomago which I’ve just said with Civmec, you know, Thales, we’ve already got a small entity, he’s actually the ex-boss of Forgacs, he’s actually building ships back in Carrington in Newcastle now, so you know people are actually doing this albeit on a smaller scale.

PT: Might it be componentry that we’re able to contribute? We saw that with the Collins class of course, we’re putting together part of the tube and sticking it on a barge and sending it to South Australia for assembly for example.

IW: Yeah look, in my views, in my talks with our members and looking industry in general, you know we’ve got some good strong primes here, but all the way down in the tier one, tier two and tier three supply chain, we’ve got some really good small high-tech entities who could provide, you know, the electronics to a lot of this opportunity as well as the, you know, the big end manufacturing.

PT: OK so what’s the process for organisations like you when it comes to lobby and Ivan how do you put your best foot forward?

IW: From HunterNet’s perspective and also the other peak bodies in our area, you know we’ve already written to… for the state perspective, we’ve written to all the local MPs as well as the current ministers and shadow ministers, we’ve already had good, strong conversations at a fed level with our four labour MPs, so we’ve already started that process so you know manufacturing is front and centre in what HunterNet does, so yeah we’ve been doing some significant lobbying already both at a fed and a state level.

PT: Ivan, have you noticed discernible change in mindset given geopolitical tensions of course and the supply chain issues that came from Covid, is there an appetite now for us to take a new look at our manufacturing capability?

IW: Yeah, I think as we spoke before, you know, I go around and talk to our members and based on, you know, the rhetoric now about strong Sovereign capability in whatever type of guise that an industry that it might be, you know we’ve really seen that taken off and that mantle and I think you know the AUKUS decision and talking about that amount of significant investment and over a significant time period is really giving people the confidence to maybe do the investments in capital as well as people.

PT: Ivan, do we need to be proactive here, I mean you and I have spoken in the past about our need for greater technical training capability in this region, we’ve got to look at things like apprenticeships and the opportunities for young people, do we need to be proactive and make ourselves a better target for these major contracts?

IW: Oh without a doubt, yeah, you know and we are also talking it from both the private sector as well as the likes of TAFE and the universities about what are the requirements for industry going forward, you know what are going to be the new tweaks to the current skill sets, and we need to be targeting, you know, young people in schools – it’s an earlier level to showcase to them that there are fantastic opportunities in the manufacturing and broader industry sector.

PT: We know that Port Kembla is leading the race to be the potential submarine base, have we given up hope here in the Hunter Region though, can Newcastle still be the home base?

IW: No, definitely not. I mean, you know that I think the announcement this morning was… it said no decision has yet been made on what the east coast base will be and so we will keep lobbying where possible to look at, you know, Newcastle being the home of submarines hopefully for the future.

PT: Ivan Waterfield, good to have you on today, I appreciate your reflections.

IW: Thanks Paul.

This interview was originally broadcast on March 14, 2023 at 10am.