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Defence DCP capability lags, despite renewed Government support

by Sam Murphy •
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UPDATE: Following the publication of this article, which referenced the Department of Defence’s AusTender Pre-Release Notice of 10 July regarding the expected timing of its Request for Tender (RFT) for projects relating to the Military Satellite Capability – Wideband Terrestrial Infrastructure project, JP 2008 (coded as JP 2008 PH5B2), Defence issued a further Pre-release notice.

The new notification states: “In July 2014, the JP2008PH5B2 Project Office advised that the Request for Tender (RFT) for SGS-E and the NMS would be released on late August 2014.

This notice is to advise, that a draft version of the Function and Performance Specification (FPS) document will be released to industry for information purposes on Monday 21 July 2014.” 

The increased level of policy support the Department of Defence has won from the Coalition Government following its September 2013 election, and the major boost to its military funding in the 2014-15 Budget, appear to have not yet had a chance to impact on its ability to manage its Defence Capability Plan (DCP) project load.

The DCP has not been updated since May 2012.  However, in a Senate Estimates Hearing in June 2014 the Minister for Defence, David Johnston said “about 119 [defence capability] programs… have been moved to the right [delayed], a further 40-odd I think that have been reduced, and eight have been cancelled.”

The most recent manifestation of such problems is that the Approach to Market (ATM) for Defence’s Satellite Ground Station East (SGW-E), and Network Management System projects, has been delayed for a second time.

The projects are part of the Military Satellite Capability – Wideband Terrestrial Infrastructure project, JP 2008 (coded as JP 2008 PH5B2).  Their objective is to install technology that “provides strategic and tactical satellite communications capabilities.”

A Request for Tender (RFT), originally due to be released in May 2014 was delayed to June/July 2014 and now Defence states that it will be released in late August 2014 to give it more time for “ongoing capability requirement definition exercises.”

The AusTender notice states, “The Commonwealth reserves the right to not proceed with the Joint Project 2008 Phase 5B2 RFT in whole or part.”  Although such disclaimers tends to be standard, in the context of the Minister’s comments on the DCP programs, and in the face of the already experienced ATM delays, there may be more to this disclaimer than is usual.

According to the Defence Capability Plan, “The satellite ground station and network management system will interface deployed forces accessing the Wideband Global SATCOM (WGS) constellation with the Defence Wide Area Network and Australian Defence headquarters and support elements.”

The total project budget for JP2008 is around $1.65 billion. While in the main, the first three phases of the project have been completed, issues have been reported with the deployment of Satellite Ground Station West (SGS-W).

In April 2014, Asia Pacific Defence Reporter suggested that the problems being encountered between the sole contractor, BAE Systems and DMO were such that JP 2008 might be placed on the ‘Projects of Concern’ list. 

The Asia Pacific Defence Reporter quoted Defence as saying that BAE Systems, “did not follow its system engineering process, sourced components and constructed SGS-W with significant technical non – conformance issues. These issues have been compounded by the Contractor's lack of expertise with WGS Ground Stations.”

The delays, scope reductions and cancellations within the Defence Capability Plan, are occurring in parallel with delays in Defence’s ICT projects program.  In January 2014, Defence announced it would not proceed with the planned market testing of its $90 million Distributed Computing Bundle.  Its reason was that its ICT transformation program required a focused and sustained effort. 

Defence Chief Finance Officer (CFO), Phillip Prior told the 2013-14 Supplementary Budget estimates that ‘An efficiency dividend as high as 2.25% and further federal fiscal tightening’ had led the department to remove approximately $16 billion from its Defence Capability Plan forecasts.

Prior said, “We have attended to that re-profiling of our budget by moving projects in our Defence Capability Plan to a later period. That has been a big part of that. We have also moved projects in the major facilities program to later years. We have also attended to deferring some major ICT projects to later years.”

Defence also told Intermedium in January 2014 that it had deferred Phase 3 of its core financial and personnel information systems project, JP 2080. Phase 3 is focussed on Defence’s financial management capabilities and must be completed before Phase 4, the upgrade of the financial management information system, can be completed.


Related Articles: 

Defence struggling under current ICT project load

Defence appoints new CTO

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