Australia to spend $270b building larger military to prepare for 'poorer, more dangerous' world and rise of China

Scott Morrison has unveiled a more aggressive defence strategy aimed at countering the rise of China, while warning that Australia faces regional challenges on a scale not seen since World War II.

Key points: Scott Morrison has committed $270 billion to defence spending over the next 10 years

Scott Morrison has committed $270 billion to defence spending over the next 10 years The ADF will get long-range anti-shipping missiles as it refocuses on possible conflict with China in the Indo-Pacific

The ADF will get long-range anti-shipping missiles as it refocuses on possible conflict with China in the Indo-Pacific The PM says the region is the "epicentre" of rising strategic competition

The strategy increases the focus on the Indo-Pacific region, with the Prime Minister warning that Australia needs to prepare for a post-COVID-19 world that is "poorer, more dangerous and more disorderly".

Australia will build a larger military that is focused on its immediate backyard, including new long-range anti-ship missiles, signalling a major shift in the nation's defence strategy.

"We have not seen the conflation of global economic and strategic uncertainty now being experienced here in Australia in our region since the existential threat we faced when the global and regional order collapsed in the 1930s and 1940s," the Prime Minister warned.

Mr Morrison also announced a commitment to spend $270 billion over the next decade on defence capabilities, including more potent strike weapons, cyber capabilities and a high-tech underwater surveillance system.

Over the four years, the Australian Defence Force (ADF) is expected to grow by 800 people, comprising 650 extra personnel for the Navy, 100 for the Air Force, and 50 for the Army.

According to Defence's 2019-20 Budget Statement, the ADF was estimated to grow to 60,090 by this year, with 16,272 full-time public service staff.

Its budget was expected to grow to 2 per cent of Australia's gross domestic product by 2020-21, "equating to approximately $200 billion in Australia's defence capability over 10 years", making the new announcement an increase of $70 billion to the department.

In a speech at the Australian Defence Force Academy Mr Morrison argued the Indo-Pacific is the "epicentre" of rising strategic competition and "the risk of miscalculation — and even conflict — is heightening".

"The Indo-Pacific is where we live — and we want an open, sovereign Indo-Pacific, free from coercion and hegemony," a copy of the speech says.

Mr Morrison argued increasing Australia's defence capability was vital to shoring up the nation's position in the region.

"The strategic competition between China and the United States means that there's a lot of tension in the cord and a lot of risk of miscalculation," Mr Morrison told Channel Seven.

"And so we have to be prepared and ready to frame the world in which we live as best as we can, and be prepared to respond and play our role to protect Australia, defend Australia."

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 4 minutes 55 seconds 4 m 55 s Defence Correspondent Andrew Greene interviews ASPI executive director Peter Jennings

In releasing the 2020 Defence Strategy Update and the accompanying Force Structure Plan, the Government confirmed Australia would purchase the AGM-158C Long Range Anti-Ship Missile (LRASM) from the United States Navy, at a cost of $800 million.

The missile has a range of more than 370 kilometres and would be a significant upgrade from the 124 km range of Australia's AGM-84 air-launched Harpoon anti-ship missile, introduced in the early 1980s.

Up to $9.3 billion will also be spent on research and development into high-speed, long-range weapons, including hypersonic weapons.

"The ADF now needs stronger deterrence capabilities," Mr Morrison told an audience of defence leaders.

"Capabilities that can hold potential adversaries' forces and critical infrastructure at risk from a distance, thereby deterring an attack on Australia and helping to prevent war."

A massive underwater surveillance system using high-tech sensors and costing between $5 billion and $7 billion is one of the biggest new purchases which could eventually also include unmanned submarines.

Mr Morrison has also promised to boost the ADF's ability to deal with what he described as the "grey zone" — activity against Australia's interests which falls below the threshold of traditional armed conflict.

The Australian Navy is expected to grow by 650 personnel over the next decade. ( Supplied: Department of Defence/Kylie Jagiello )

Labor's defence spokesman, Richard Marles, welcomed the shift in strategy.

"COVID-19 is changing the world around us, the world in which we live," he said.

"Labor supports strong defence resilience for Australia in the face of this, that is going to be much more important … in the future than it has been in the past."

Peter Jennings from the Australian Strategic Policy Institute (ASPI) said the world had changed dramatically since the last Defence White Paper was released, particularly in the era of COVID-19.

"What this policy document does is it starts to increase the hitting power of the Defence Force in the short term, rather than being focused on building submarines that will be ready in the late 2030s and into the 2040s," Mr Jennings told ABC RN.

"We've got to be worried about 2020 and the next 12 to 24 months or so."

Mr Jennings said there was "only one country with both the capacity and the desire to dominate the Indo-Pacific region in a way that works against Australia's interest".

"We're not talking about Canada," he said.

"When they talk about the bad behaviour that's happening in the region, the annexation of territory, coercion, the influencing of domestic politics, the use of cyber attacks – it's really only one country which is doing that at industrial levels, and that's the People's Republic of China."

The Government will spend $15 billion on cyber and information warfare capabilities over the next 10 years, $1.3 billion of which will be used to boost the cyber security activities of the Australian Signals Directorate and the Australian Cyber Security Centre.

Including a network of satellites for an independent communications network, $7 billion will also go towards improving Defence's capabilities in space.

Mr Morrison said the 10-year funding commitment went beyond the Government's pledge to boost Defence spending to 2 per cent of GDP.

Have more information? Contact Andrew Greene at [email protected] and Jade Macmillan at [email protected].