AUKUS is jeopardising Australia’s independence and economic stability

It would be better to renegotiate or cancel the AUKUS agreement to better align with Australia’s national interest and maintain our true independence.

The revised AUKUS agreement presents a serious imbalance in the legal rights and commitments among its signatories – Australia on one side, and the United Kingdom and the United States on the other – and exposes Australia to significant geopolitical and financial risks without any recourse to redress or withdraw from this agreement. The deal, now extended until 2075, highlights a substantial shift from the initial expiry at some ethereal point in the 2040s, embedding Australia deeper into a complex trilateral naval pact which was supposedly aimed at enhancing undersea and strategic capabilities through the sharing of nuclear submarine technologies.

Central to the concerns over the amended deal is the clause that allows the UK and the US unilateral rights to terminate the agreement with 12-months’ notice, if they perceive the deal as counterproductive to their own submarine projects or broader national interests. But what about Australia’s interests? There isn’t a reciprocal right for Australia, which doesn’t have the ability to exit the agreement under similar circumstances, nor to seek compensation should the pact be dissolved. This discrepancy not only places Australia in a vulnerable strategic position but also at a financial disadvantage, given the extensive investments already committed to the project over the past three years.

Australia’s obligations under the agreement include hefty financial contributions and indemnifying the US and UK against liabilities, including those arising from nuclear risks, without limits or conditions. Such terms raise questions about the degree of influence and security Australia gains in return, and this is a transaction heavily skewed in favour of its partners. The payments made so far – totaling $13 billion to the US and UK ($4.7 billion each), and to settle the cancellation of a prior contract with the French Naval Group ($3.4 billion) – also highlights the economic burden shouldered by Australia without tangible assets or guarantees of delivery.

The geopolitical implications of this lopsided agreement extend beyond immediate financial strains as it positions Australia as a junior partner in a strategic pact that could influence its foreign and defence policies for decades, while offering almost no leverage over these terms. The long duration of the deal – 51 years – a period which is likely to see shifts in international politics and the global technological military landscape, further complicates Australia’s predicament. Since the original deal was created in 2021, Australia has had two different prime ministers, Britain is now onto its third prime minister, and the US will have a new president in early 2025. Will China be a different type of international player in another decade or two? Will the US be more hostile towards Australian interests by 2050?

The world is in a constant state of flux. This lack of a termination clause for Australia reveals a significant oversight or misjudgment in diplomatic negotiations, and underestimates the strategic shifts that could occur over the lifespan of the agreement. The deal not only represents a significant policy challenge for Australia but also a crucial test of its ability to navigate complex and shifting alliances in an increasingly changing world.

Assessing Australia’s future in an evolving military world

The employment opportunities in Australia generated by AUKUS – as yet, unseen and unknown – are often highlighted as a significant benefit, ostensibly supporting high-tech industries and sustains high-wage jobs and, for sure, the prospect of long-term employment in constructing and maintaining a fleet of submarines is an appealing economic stimulus. This employment might indeed serve as a temporary economic buffer, providing jobs in advanced manufacturing sectors and resulting in further technological development.

However, the critical question remains: what value do these jobs create if the output – nuclear submarines – becomes obsolete or redundant in the evolving landscape of military technology over the next twenty to thirty years? This is not a distant hypothetical. The trajectory of military technology is veering sharply towards unmanned systems, drone and cluster technologies, which promise more flexible, cost-effective and advanced capabilities than traditional manned submarines. These systems are not only less detectable but can be operated at a fraction of the cost and risk, rendering large, manned submarine fleets obsolete in future strategic developments.

This exchange in the Senate Estimates Committee on Defence between the Australian Greens Senator David Shoebridge and Vice Admiral Jonathan Mead, highlights the precariousness of Australia’s position:

Shoebridge: Does the agreement provide that, if the United States does not provide us with an AUKUS submarine, we get our money back?

Mead: The US will provide us with an AUKUS submarine.

S: Did you not understand that my question wasn’t about some future hypothetical? I’m asking about what’s in the agreement. Is the reason you won’t answer what’s in the agreement that it embarrassingly fails to have that?

M: You’re talking about a future hypothetical.

S: I’m talking about what’s in the agreement now.

M: The US will provide two submarines and one on procurement.

S: I suppose it may be embarrassing that you’ve entered into an agreement that sees Australian taxpayers shelling out $4.7 billion which we don’t get back if we don’t get a nuclear sub. That might be embarrassing, but that’s not a reason not to answer it. Does the agreement have a clawback provision?

M: I reiterate my statement. The US is committed to transferring two US submarines.

S: The only way of reading that answer is ‘no’, and it’s embarrassing and it’s a gamble.

The initial promise of two Virginia-class submarines from the US by 2025 has already been halved – to one! – and even this reduced commitment seems tenuous. Senator Shoebridge’s line of questioning reveals a crucial absence of protective measures in the deal, such as a clawback provision in the event that the promised submarines are not delivered – which, at this stage, seems very likely.

The inherent risk in tying Australia’s economic and military strategies to an aging technology in an evolving field is obvious. While the immediate economic benefits of job creation are tangible, what are these jobs for? It’s almost like a complex work-for-the-dole scheme and could divert resources away from more pressing national security concerns and the development of technologies that could genuinely enhance Australia’s defence and strategic capabilities in a future dominated by automated and cyber warfare technologies.

The public has a right to know about the details of AUKUS

The AUKUS agreement, as currently structured, highlights a broader pattern of unchecked defence spending and unclear decision-making that marginalises taxpayer oversight and democratic accountability in Australia. It’s a similar situation on national security and the Australian Federal Police: whatever these agencies ask of the government, these agencies always receive.

This agreement’s design essentially reduces Australia to a dependent status, compromising its ability to act independently on the global stage. Such a dynamic not only diminishes Australia’s leverage in the AUKUS partnership but also within the broader international community, where strategic autonomy is crucial for negotiating geopolitical challenges and opportunities.

The massive financial outlay committed by Australia – at least $368 billion with little to no safeguard mechanisms – exposes the country to significant economic risk without guarantees of strategic gain, as well as locking in current and future generations into paying for a strategy that may well be outdated within a decade or two.

The notion of tying Australia’s defence strategy to the procurement of a small number of submarines to patrol its extensive coastline is optimistic – a Yes Minister level of ‘optimism’ – and exemplifies a strategic misalignment with contemporary defence needs and realities. The evolving nature of military threats and technologies calls for a defence strategy that is adaptive and forward-thinking rather than one anchored in the military thinking of yesteryear.

Australia’s strategic partnerships should reflect a balance of power, mutual benefits, and flexibility to adapt to changing global circumstances – an ideal treaty would not only secure Australia’s defence interests but also preserve its financial integrity and strategic autonomy, and involve a broader set of regional allies and contain provisions that allow for adaptation to technological and geopolitical shifts, unlike the rigid and asymmetric commitments now enshrined in AUKUS.

The AUKUS deal is a classic example of policy shaped more by the egos and immediate political interests of its architects – Scott Morrison, Joe Biden and Boris Johnson – than by a judicious assessment of Australia’s long-term national interests. It would be better to renegotiate the terms of this agreement – or cancel it entirely – to better align with the country’s real defence needs and strategic aspirations, one that serves Australia’s national interest and maintains its true independence.