Australia Boosts Defence Spending, But More May Be Needed in Age of Uncertainty

Australia's ruling Labor Party revealed plans in its federal budget on March 25 to fast-track A$1 billion (S$843 million) in defence spending amid a growing consensus in Canberra that the amount will need to be increased to address regional security risks.

- Jonathan Pearlman

Unfortunately for Labor, which faces an election due to be held by May, the additional outlay did not appear to persuade analysts that the government is spending enough to secure the nation.

The budget revealed plans to lift annual defence spending from A$59 billion in the year to June 30, 2026 – or 2 per cent of the country's gross domestic product (GDP) – to A$74 billion – or 2.2 per cent – by the year to June 30, 2029. The boost includes a move to bring forward A$1 billion in spending, which was due to be spent in 2029 and will now be spent from 2026 to 2028.

But the plans fall short of the proposed spending of 3 per cent that the Trump administration, as well as commentators in Australia, have called for. Former Labor leader Kim Beazley recently proposed lifting spending to 3 or 3.5 per cent.

A former senior Australian defence official, Mr Michael Shoebridge, a director of the think-tank Strategic Analysis Australia, told The Straits Times the government should be lifting defence spending to 3 per cent of the GDP within three years.

He said current spending levels will leave Australia's military "more fragile and weaker", especially as much of the spending is on major projects such as the acquisition of nuclear-powered submarines under the Aukus security pact with the United States and the United Kingdom, which will not be fully in place for decades.