Rob Sutton, Managing Director

Strategic circumstances are now radically different 

The DSR states that “Australia’s strategic circumstances and the risks we face are now radically different. The DSR is explicit in identifying China’s military buildup and activities in the Indo-Pacific as a direct threat to Australian interests. In this context, a Chinese invasion of Taiwan and Pacific Island coercion, are the most likely threats, not invasion of mainland Australia. Mainland invasion not the biggest concern: minister ( 

Whilst we need to be prepared to counter Chinese coercion of our Pacific family, a Chinese invasion of Taiwan represents the most difficult of the two threats, and the one more likely to require a large scale military response.  

So what would the role of the ADF be in such a scenario? Again, the DSR is explicit: the ADF needs to be refocused on “denial”, i.e. holding forces at risk in our northern maritime approaches, or, as Defence Minister, Richard Marles puts it, “impactful projection”. In the case of a Chinese invasion of Taiwan, the primary role of the ADF would be to deny Chinese freedom of movement in Australia’s immediate region.  

Our northern approaches have the following characteristics: 

  • Tropical climate, including monsoon rains. 
  • Numerous islands, ranging in size from small to large, typically forested with difficult, mountainous terrain 
  • Large areas of shallow water and coral reefs 

If this will be our primary operating area, to be able to deny Chinese freedom of movement in this region, there is a need for: 

  • More and smaller surface ships (with a greater missile loadout),  
  • An amphibious Army prioritised for littoral operations and supported with both anti-air and anti-ship missile capabilities  
  • An agile air force operating as far north as possible, with long range air-to-surface capability 
  • Air defence and long-range strike capabilities to create a layered anti-access, area-denial (A2AD) “bubble”.  

The DSR makes many recommendations, some of which are classified and therefore not available in the public report. The public recommendations seem to align to the proposed changes in the operating environment and the derived needs. In this way, the DSR is fundamentally reshaping the force structure of the ADF and focusing its mission on denial.  

The completeness of the DSR 

The terms of reference for the DSR state that it is “to be a holistic consideration of Australia’s Defence force structure and posture, by including force disposition, preparedness, strategy and associated investments”. As written, the DSR is a high-level strategic document but covers smattering of force structure and force posture decisions. By necessity it is not a complete document. So, how do we assess how successful the DSR has been in articulating the changes required to meet the our strategic circumstances? 

First, whilst the public version of the document is derived from the actual DSR, it is not the same. Therefore, there may be recommendations or analysis in the classified version of the report which may shed light to some of the questions that are being raised. 

Second, the A2AD reposturing is a great step forward, and brings us well into the missile age (which arguably began in the 50s, but maybe that will be another post).  

 As a lens to look at the other elements of the DSR through, Phillips O’Brien describes military capability generation as consisting of three phases: pre-production, production and deployment. For example, in a hypothetical conflict with China, the ADF would need to deploy and sustain forces hundreds of kilometers away from Australia (deployment). Simultaneously, Australia would need to produce or otherwise procure significant numbers of weapons and platforms to sustain operations, replace inevitable losses, and build up forces to achieve overmatch (production). To do this, Australia would require secure supply chains for system components and materials (pre-production). Because we have now lost our warning time, where do we sit with each of these components?   

          Deployment: Without going into a complete logistics analysis, the DSR largely has this element covered. We have a surface fleet capable of lodging an amphibious land element into our immediate region. The DSR proposes additional landing craft, which will further increase our capability to support and sustain littoral operations. There may be insufficient assets at a tactical level to sustain operations, but I will cover that in another post.

          Production: Simply, we do not have the industrial capability in Australia right now to produce the weapons and equipment we need in a major conflict. We certainly have no ability to build major equipment like the F35. We were going to have some capability to build armoured vehicles, but the DSR has removed the majority of the L400 vehicle buy which makes the local manufacturing case more difficult, and regardless massed armour is less useful in a littoral environment. We have made no progress on the production of guided weapons locally since the announcements were made 2 years ago, albeit companies like Black Sky Aerospace have developed Australian missiles. And the support for our sovereign Robotics and Autonomous Systems ecosystem is woeful, particularly from Defence. In the missile age, we must be able to build missiles and drones locally. We simply cannot sustain the volume of consumption and attrition of the core capabilities without a sovereign industry ecosystem. We have put ourselves in a position where we have to purchase the majority of what we need from overseas, which means that ongoing access to our supply chains is a critical vulnerability. The DSR speaks to a greater speed of acquisition, but completely fails to address the strengthening of the industrial ecosystem in Australia.

          Pre-production: Fortunately, if we don’t make anything here, we don’t need to worry about complex supply chains… or do we? Unfortunately, even general sustainment operations require access to materials and system components, such as fuels and lubricants, specialist metals and composites, computer chips and electronic components, etc. There is no possibility of any country making all the material and system components that they need, as Russia has found out to its detriment, but we should still understand what the critical elements of the supply chain are and take steps to secure them. For example, we only have one chip foundry in Australia, and both Europe and the United States are taking steps to bring chip manufacturing onshore. In the event of a conflict with China, access to the chips made by Taiwan will be non-existent. How should we support and secure our own access to computer chips? 

So the DSR, as a quick review, does a good job of addressing the major issues facing Australia, with the main exception of failing to support and grow the sovereign industrial ecosystem. Secondly, as a strategic document, it glosses over the detail, which, as we know, is where the devil is… 

Big challenges ahead implementing Defence review recommendations | The Strategist ( 

Does the money match the mouth? 

The Federal Budget was handed down late last week and while it includes the big-ticket items from the DSR like nuclear-powered submarines and long-range strike capabilities, it also incorporates a few more pieces of the DSR puzzle.   In particular, the very deliberate refocus of our force posture through the significant investment of $3.8b in northern Defence base infrastructure and almost $2b for strategic engagement (or security and peace) in the Indo-Pacific. This urgent realignment under the new National Defence conceptual approach is another powerful indicator of the strategic threat in our region. However, the sense of urgency created by the DSR is not matched by the budget. 

As forecast in the discussion around the release of the DSR, the federal budget does not include any new money for Defence. In fact, several of the announcements in the DSR rely on internal savings within Defence, which means that there is pressure across all services to cut costs and capability.  

Budget reveals pressures on Defence for savings to fund nuclear-powered submarines | The Strategist ( 


The DSR is an important document and has made some much needed changes. It clarifies and focusses the ADF warfighting strategy to a strategy of anti-access, area denial (A2AD). It moves the ADF to the missile (and #drone) age, and away from a platform centric view of the world. And, it realises that in order to effectively support our forces, we have to be able to manufacture munitions locally.  Australian Industry should be seen as critical component in the generation of combat capability, and should be given a much larger degree of support that is present in the currently. Also, much of the details that would normally be seen in a review of this magnitude are missing, and these details will need to be worked through over the coming months. 

Written by Rob Sutton, Managing Director – Mirragin