AllFOR IMMEDIATE RELEASE 26 March 2025
Canberra:
AIDN is calling for a boost to defence spending from both major parties in the upcoming federal election, but any new funding must be accompanied by reform to provide SME’s with greater opportunities to win work.
Reports this week have suggested the Coalition if it wins Government at the 2025 election could boost annual defence spending to 2.5 per cent of GDP or an investment of as much as an extra $15 billion a year.
While the Albanese Government brought forward $1 billion part of its pledge to boost spending to 2.3 percent of GDP or an extra $50.7 billion by 2033-34.
“However, AIDN was disappointed there were not more measures in the budget to relieve cost pressures for SME’s or enable them to better compete for defence work,’’ AIDN CEO Mike Johnson said.
AIDN has long argued any defence funding increase must be accompanied by reforms to better support the SME sector including committing to:
- funding and growing a sovereign owned, risk mitigated, capability supply chain, comprised of SMEs who produce and supply world leading products and services,
- simplifying the number of, and complexities relating to, contracting mechanisms used to engage Australian SMEs.
- a minimum quota of total Defence budget spend for Australian SMEs, without assigning the policing role to Primes and/or MSPs,
- a fair and regularly reviewed competitive environment for SMEs to engage in, by refreshing panels annually; and,
- having all election statements validated as “costed” by the Finance Minister/ Shadow Finance Minister as/when they are announced.
AIDN appreciates progress is being made with the Albanese Government redefining the definition of an Australian business for Commonwealth non-defence procurement and the introduction of the Advanced Strategic Capabilities Accelerator which has supported innovative SME’s is also a good start. But much more remains to be done.
“SME’s are the backbone of the Australian economy. Engaging them more meaningfully in defence projects will foster economic growth, create local jobs, and build a more resilient supply chain,’’ AIDN CEO Mike Johnson said.
“Better utilising SMEs strengthens Australia’s sovereign industrial base, reduces reliance on foreign suppliers and ensures a pathway to greater defence self-reliance,’’ Mr Johnson added.
ENDS
MEDIA CONTACT
John Kerin, Manager Government Relations, Australian Industry & Defence Network.
M: 0400 906 545
ABOUT AIDN
Established in 1995, the Australian Industry & Defence Network Limited (AIDN) is the peak industry association representing small-to-medium enterprises (SMEs) supporting the Australian Defence Force (ADF) and the Department of Defence (DoD).
AIDN proudly represents nearly 1,000 Australian SMEs, collectively employing approximately 61,000 Australians nationwide. In the 2021-22 financial year, these dedicated businesses contributed $10.6 billion to the national economy through sovereign supply chains, advanced manufacturing, research and innovation, skills development, and regional and veteran employment.
In an environment of economic and geopolitical uncertainty, AIDN’s agile membership is well-positioned to support the Australian Government’s urgent capability needs. However, clear guidance on specific priorities is essential to unlock the full potential of Australia’s Defence industry.
Through advocacy, representation, and tailored member services, AIDN champions the interests of Australian SMEs within the Defence and national security sectors. AIDN remains committed to partnering with the Australian Government to build a resilient and self-reliant Defence industrial base, driven by the evolving operational needs of the ADF.
The Australian Industry & Defence Network Incorporated (AIDN) is the peak industry association for small-to-medium enterprises (SMEs) who support the Australian Defence Force (ADF) and the Department of Defence (DoD).
