Matt Doran, Host: Well, staying with all things defence. The US State Department has approved the sale of up to 220 Tomahawk cruise missiles to Australia. The deal was first flagged in 2016 before the AUKUS agreement but has now been signed off by US officials at a cost of roughly $1.3 billion. The missiles would be fielded on the Navy's Hobart class destroyers and could eventually be fired from Virginia class nuclear powered submarines. The Defence Industry Minister explained earlier where we're at in the acquisition process.

Pat Conroy, Minister for Defence Industry: It’s in the planning phase, in that it's gone through what's called first pass, where governments decide that this is something they want to pursue. We then go to the United States and ask them through what's called foreign military sales to price and tell us how much the capability costs and to indicate that they would be prepared to sell us it. And then it goes back to government for a final decision on whether to go ahead with it. But as I said, we're committed to upgrading the air war for destroyers. We'll be giving them an improved combat system in the second half of this decade and ideally, we would like to equip them with better long range strike capabilities. And a Tomahawk really is at the pinnacle of that capability.

Matt Doran: Let's bring in the Assistant Minister for Manufacturing, Tim Ayres. He is live in our Sydney studios this Friday. Senator, thanks for coming back on Afternoon Briefing. I want to touch on rail in a moment because I know that's something that you've been talking about quite a bit today. But on this issue of the massive manufacturing uplift, that's going to have to happen over the next couple of decades to deliver the AUKUS deal. It seems like we're coming off an incredibly low base with having the skilled workers, having the facilities to build these incredibly complex nuclear submarines. Are we at risk of falling short of where we need to be, considering that that preparation work needs to start right now?

Tim Ayres, Assistant Minister for Trade and Assistant Minister for Manufacturing: Well, you're right to point to both the enormous opportunity for Australian industry and the significant challenges in front of us. We need to make sure that we are skilling generations of workers to come, PhD level, engineers, tradespeople, submariners all the way through. Now, these are very significant opportunities for Australian industry. It sits very comfortably alongside our ambitions In the National Reconstruction Fund and our industry policy ambitions for critical minerals and critical supply chains to lift Australia up the value chain. But that is going to require consistency, stability, a commitment in terms of purpose, allocating resources in terms of skills in particular. And that's why the critical path process focussed on those issues very strongly.

I'm very confident that with the cooperation of the States and with the pathway forwards that was identified in the statements this week, that we'll be able to deliver an onshore manufacturing programme that will really revitalise Australian industry and put manufacturing back again at the centre of the national economy.

Matt Doran: Given there's all those training considerations that are going to go on for many decades to come, but there is also a desire and a need for expertise in Australia's manufacturing system in the very near term. Are we going to have to look at things like greater migration to bring in skilled workers for the manufacturing sector to kick start that process?

Assistant Minister: Well, the government will make announcements in due course in terms of our skilled migration programme. But what I can say is you've seen already the shape of what the government is going to prioritise here. Thousands of new fee-free positions in TAFE across the country, really prioritising those trades and other TAFE level occupations. These are the kind of jobs in our suburbs and outer suburbs, in our regions that really matter, that are good jobs, that give people the opportunity for training, for career progression, for decent work that you can build a family around. This submarine programme is, yes, it's an important national strategic capability for Australia in a pretty consequential period in regional and world affairs, but it's also an enormous opportunity for good jobs, reindustrialisation and fair dinkum industry policy.

Matt Doran: Is there going to be hurdles from, I guess you could call it nimbyism when we're talking about the sort of expansion of things like potentially building an East Coast port in Port Kembla? I know that that's a decision that hasn't been made, but when we're talking about the work that's going to have to be done to build these manufacturing facilities, to build these bases, the sort of pushback that you get from the community, is that a hurdle that's going to be hard to jump?

Assistant Minister: We're going to have to work with communities right across the country, on the West Coast and on the East Coast for this endeavour. This is the biggest military procurement or infrastructure project in Australia's history. It is not going to pass without some debate, without proper consultation, without working these issues through with communities. But it is a very significant endeavour. It has many facets, it is very complex, but as Richard Marles said earlier today, it is of real consequence for the country, and we've got to make sure that this is executed properly. And I'm very confident that the critical path process which has just been unveiled, gives the country some real certainty about where this is headed.

It's not new news. The AUKUS submarine commitment, when it was announced by the previous government, supported by Labor in opposition, it was very clear where this was headed. What we've seen this week is some more detail. And of course, with that comes more community discussion.

Matt Doran: Let's move to a different topic, and your focus today has been on the issue of rail. A new report that's been released suggesting that the states have actually had to spend a whole lot more money than was actually necessary because rail systems just aren't quite up to scratch. Can you talk us through what this new report has been finding?

Assistant Minister: Well, there's two layers of problems here. First, one state in particular, here, where I am in New South Wales, has been offshoring billions of dollars’ worth of rail rollingstock procurement contracts overseas over the course of the last ten years. Billions of dollars’ worth of lost jobs, lost investment opportunities, thousands of lost blue-collar jobs in the outer suburbs and in the Hunter Valley. Hundreds and hundreds of apprenticeship opportunities gone for young workers. And the outcome has been projects that have run over budget, projects that have never been delivered on time, and significant quality defects that have had to be repaired once the trains have arrived here on shore.

So, the first point underscored by this report is we need to build local content, build the trains of the future in Australia and the Victorian and Queensland Governments in particular, and Western Australia too, have had very effective local procurement policies. The Victorian trains, all manufactured in Victoria, thousands of job opportunities there in Queensland, Annastacia Palaszczuk just announcing $7 billion worth of commitment to future rail contracts and a rail manufacturing facility there. This report goes one step further and it really underscores what it is that the Albanese Government has committed to. We have said coming into government that we're going to develop a National Rail Manufacturing Strategy. And I'm busily working away at making sure that the architecture is in place to do that. And what that is going to do is coordinate amongst the states, to deliver what this report points out is real significant efficiency opportunities and very significant opportunities to build and design the trains of the future.

Now, the report says $2 billion it's cost the taxpayer over the last ten years, not having those effective national procurement strategies. I can tell you it's cost thousands of jobs, it's cost hundreds of apprenticeships. And I want to make sure that we're working in a cooperative way with the states to build the trains of the future. And they will be built not in our inner cities or our CBDs, they'll be built in our outer suburbs and in our regional centres, where we need, as I indicated before in the AUKUS discussion, good, decent blue-collar jobs and a return of manufacturing and a reindustrialisation and diversification of those economies.

Matt Doran: Well, Tim Ayres, thanks for your insights today.

Assistant Minister: Good on you. Good to be on the show.