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Alarm over PM's submarine 'deal'

Prime Minister Tony Abbott

There is a growing alarm over a minute-to-midnight deal struck between Tony Abbott and South Australian Liberals over submarines to secure votes in the leadership spill.

Liberal Senator Sean Edwards claimed on Sunday that Mr Abbott had given him an assurance Australian companies would be given a chance to bid to build the submarines.

“I’ve been in discussions surrounding the ability of Australian ship builders to be involved in an open, competitive tender which has been, up until today, something which the Government has been somewhat reserved on,” he said.

In fact, Mr Abbott has only promised a “competitive evaluation process” – terminology that is unknown to the Defence Department.

Defence industry insiders have told The West Australian they do not know what it means.

Defence Minister Kevin Andrews, who this morning visited Australian Submarine Corporation in Adelaide, could not shed any light on the difference between a tender and a “competitive evaluation process”.

In a testy press conference, Mr Andrews repeatedly batted away questions on what had changed since Mr Abbott had cut his deal with Liberal Senator Sean Edwards.

Finance Minister Mathias Cormann said on Monday that the Government’s policy had not changed on contract procurement for the multi-billion-dollar submarine build.

Coalition talking points prepared for MPs by the Prime Minister’s Office, obtained by The West Australian, reveal that the Defence Department will be expected to oversee the competitive evaluation process even though it is understood that even top brass does not know what it means.

“Decisions on a design partner and construction of the submarines will be based on a competitive evaluation process managed by the Department of Defence that takes fully into account capability requirement, cost, schedule, technical risk and value for money considerations,” the talking points say.

“Any Australian company that can credibly meet these criteria will be considered on merit, as will potential international partners.”

Yesterday, Mr Abbott denied he had a secret deal with Japanese counterpart Shinzo Abe to build the submarine hulls in Japan, saying Australia was also talking to other nations.

Mr Abbott said it was “possible, maybe even likely” that an international partner would be found to build new submarines for Australia.

“Well, there are no secret deals,” Mr Abbott said on Monday.

“We want Australian sub-mariners to put the sea in a really world class submarine.”

Mr Abbott said Australia was continuing to talk to Japan, German and France about building a new sub.

Andrew Davies from the Australian Strategic Policy Institute said the Government’s acquisition process for new subs was “unclear”.

Dr Davies said a more open competition for a replacement sub would make a deal with Tokyo less likely, as Japan was not read to ne an arms exporter in a global market.

Opposition leader Bill Shorten questioned why Mr Abbott had not moved to an open tender for new subs earlier.

“It wasn’t the thousands of shipbuilding jobs at risk that forced Tony Abbott to act - it was the threat of losing his own job,” Mr Shorten said.