by Peter Yule
really loves and he hopped into the portfolio with great enthu-
siasm’. Beazley was well aware of the strategic value of sub-
marines, holding the view that: ‘Basically submarines are the poor
man’s weapon to cause maximum angst to a bigger enemy.’17
More fundamentally, he was a strong supporter of the Amer-
ican alliance and appreciated that intelligence exchange could
build trust and influence with the United States. Beazley under-
stood how the strategic intelligence gathered by the Oberons had
improved Australia’s standing with the Americans. Although he
was working in a government where some members were wary of
such activities, he was determined that the capability should be
retained.
Beazley deliberately worked to raise the profile of the subma-
rine arm. He felt that it was one of the components of the defence
force that was habitually undervalued, and he recalls that at one
stage he threatened to promote no more naval officers to flag rank
unless the next recommendation was for a submariner.18 It was
not a coincidence that the first (and only) submariner to become
chief of the navy, Ian MacDougall, was appointed by Kim Beazley.
Soon after taking office, Kim Beazley commissioned strategist
Paul Dibb to conduct a thorough review of Australian defence
policy and told Dibb he had ‘open slather on investigations and
the power to negotiate a consensus on force structure with Defence
and the service chiefs’. The only thing that was off limits was the
submarine project – Beazley would not allow Dibb to revise the
project objective, numbers or capabilities.19
Kim Beazley agreed with the analysis of Sir Alan Watt that:
‘Many nations must depend on others for their ultimate security
but in most cases they try to maximise their own independence
within a relationship of dependency. Australia has seemed intent
on doing the very opposite: of maximising its dependence, first on
Britain and lately on the US.’20 While strongly committed to the
American alliance, Beazley’s primary aim as defence minister was
to increase Australia’s self-reliance within the framework of the
alliance. In his view, self-reliance meant armed forces structured
56
T H E C O L L I N S C L A S S S U B M A R I N E S T O R Y
and equipped to defend Australia rather than to participate in dis-
tant wars as part of an expeditionary force; equally importantly,
it meant a strong manufacturing capability to support the armed
forces.21
Graham White recalls that the first office Minister Beazley vis-
ited was the submarine project office in Fyshwick, and the first
vessel he went on was a submarine. Traditionally ministers dealt
with the uniformed members of the forces through the secretary
of the department, so Rod Fayle remembers to his surprise one
day answering the phone in the project office and finding Kim
Beazley on the other end of the line. Fayle said, ‘I’m not allowed
to talk to you’, but Beazley said that he was being given a lot
of contradictory information about the submarine project and:
‘I want to speak with someone who knows what’s going on. Come
over and speak to me.’ Fayle replied, ‘I’m not allowed to. I’ll
get into trouble’, but the minister told him, ‘You ring Admiral
Hudson [the chief of the navy] and tell him I want to speak to
you about the project.’ Rod Fayle did this, and he and Graham
White went on to spend many hours talking with Kim Beazley,
often remaining with him late into the night. The results were, on
the one hand, that Beazley was fully informed of the project and
came to see the force of the arguments for building in Australia,
and on the other, that White and Fayle became deeply unpopular
with the navy hierarchy, who felt they were being bypassed and
losing control of the project.
By 1984 the idea of building submarines in Australia had gone
well beyond the initial vague aspiration to become an important
part of the procurement process. The eventual decision to award
the submarine contract to a Swedish-led consortium owed at least
as much to the Swedes’ commitment to building in Australia and
their advanced design and building techniques as to the actual
merits of their proposed design. Jim Duncan observed in his diary
on 21 November 1984: ‘VSEL [the British bidders] are bitter that
they are being beaten by a production technology . . . they claim
that Canberra is obsessed with production technology rather than
submarine technology.’
When the Labor government came to office in March 1983,
its Senate leader, John Button, became Minister for Industry and
Commerce, a position he held for 10 years. He recalled that when
he came into office: ‘Many of the major industry associations
T H E A C T S O F T H E A P O S T L E S
57
sought subsidies and tariffs. The unions were locked into protec-
tion as the solution to job losses in manufacturing.’22 To Button,
the cures for Australia’s economic woes did not lie in increasing
protection but in ‘revitalising manufacturing by means of better
technology, a skilled workforce and flexible work practices’ – a
similar mantra to the one coming from the submarine project
team.
John Button found Graham White ‘the most impressive of the
navy people’, and he accepted White’s arguments for building the
submarines in Australia. Button was ‘strongly opposed to buy-
ing “off-the-shelf” submarines or anything else’ and he believed
that the project could have enormous spin-offs for the revitalisa-
tion of manufacturing. Although he feels the claim that he was
responsible for the decision to build the submarines in Australia
overstates his influence, most people close to the project feel that
his role was crucial and he was one of the submarine project’s
staunchest supporters in the cabinet.
In 1984 John Button was one of several cabinet ministers to
visit Sweden. One of his meetings was at the Federation of Swedish
Industry, and he recalled that: ‘At lunch I found myself sitting
next to Mr Roger Sprimont, a former naval officer and a director
of the shipbuilding company, Kockums. It was not, I think, an
accident.’23
C H A P T E R 7
‘But how will you judge them?’: the
tender evaluation process 1984–85
There appear to have been two virtually separate histories of the
new submarine project running in parallel during the mid-1980s.
On the one hand there was the campaign around Australia led
by Hans Ohff, John White, Graham White and Jim Duncan that
put forward the submarine project as a major catalyst for indus-
trial regeneration. On the other there were the bureaucratic pro-
cesses of defence procurement among a small circle within the
Department of Defence and the navy, with political involvement
in the critical decisions. Within the defence bureaucracy there was
great uncertainty abo
ut the submariners’ requirements and the
proposed purchasing strategy and little enthusiasm for building
in Australia.
It was not until December 1982 that the procurement method
was endorsed by the defence source definition committee, allow-
ing the release of formal proposals to industry. However, the
force structure committee, which assessed budgetary allocations,
imposed strong caveats on the project. It insisted on continued
investigation of the suitability of smaller submarines, and of post-
poning the project if the Oberons’ service could be extended.
Further, Alan Wrigley, the committee’s chairman, insisted that
58
B U T H O W W I L L Y O U J U D G E T H E M ?
59
Australian industry involvement should be limited.1 Wrigley con-
sidered that building an industry around the project unnecessarily
complicated the selection processes for no good reason. He was
sure that a submarine industry could not be sustained because the
type of submarine the navy wanted was too big to interest foreign
navies. Wrigley energetically pushed this view in the last months
of the Fraser government, but the change of government in March
1983 meant that he was swimming against a fast-flowing tide.2
The project team proposed a new strategy for acquiring the
submarines. The tenders sought in early 1983 would not be for
the provision of equipment but, instead, for designs and proposals
from which the two most promising would be selected for a
detailed, funded study. This stage – the project definition study –
would allow the project team to seek answers to the many
questions that could affect the viability of the project. Usually
contractual obligations enforced the manufacturer’s performance
claims. With the new submarine, the navy wanted to make its own
judgments on how the equipment would perform.
Tenderers were to explain how they would promote partic-
ipation by Australian industry in the project. The submarine
builders were required to evaluate the technical risks of building in
Australia and to put together a viable consortium capable of
becoming prime contractor for the project. The contractors were
expected to provide a product and then assist the navy to find
ways to build it locally.
In January 1983 manufacturers of ‘modern integrated combat
systems’ were invited to register interest in the project, followed
in May by a request for tenders to submarine builders. While the
former was an open request to survey the market responses, the
tender document was issued only to the seven submarine design
companies identified by the project team as viable contenders. This
was an unusual process in the regulated world of government
contracting, where open competition was usually unavoidable,
and it needed special authorisation.
The tender request stipulated that the submarine should meet
as closely as possible the navy’s required ship’s characteristics and
also be a design already in service or due in service by 1986. This
would allow the project to take advantage of sea trials conducted
by the parent navy, an area in which Australia had little experi-
ence. As a minimum, the design should be based on a submarine
60
T H E C O L L I N S C L A S S S U B M A R I N E S T O R Y
already proven in service with a foreign navy, with any modifica-
tions required to meet Australian specifications to be of low risk
and cost.3 The request also stated that it would be an advantage
for a company to have had experience in building submarines in
other than their home nation.
All seven companies responded to the tender request. The
proposal from the Italian firm Cantieri Navali Riuniti was an
enlarged version of the Sauro, a design of the early 1970s. The
French company, Chartiers Dubigeon, presented a design for
a conventionally-powered version of its Rubis nuclear-powered
submarine.
Many submariners liked the design by the Dutch consortium
of designer United Shipbuilder Bureaux and shipyard de Rot-
terdamsche Droogdok Maatschappij (RDM). This was a well-
established Dutch team that had adapted the experimental ‘tear-
drop’ hull shape of the USS Albacore for modern conventional
submarines. In 1983 the Walrus, the first of a new class of sub-
marine for the Royal Netherlands Navy, and two submarines for
Taiwan, based on the earlier Dutch Zwaardvis class, were under
construction. This was the design considered by Hans Ohff as the
best but most difficult to build.
Vickers Shipbuilding and Engineering put forward the Type
2400 Upholder design. Since the late 19th century Vickers had
been one of the world’s great armaments manufacturers, but,
along with other major British shipyards, it was nationalised in
1977 to avert financial disaster. Vickers had built every British
nuclear submarine but no conventional boats after the 1960s,
except three German-designed Gal class for Israel. It had no expe-
rience of managing submarine construction programs overseas
and, even with its connections to Cockatoo Island Dockyard,
appeared less than interested in Australian production.4
Ingenieur Kontor L übeck (IKL) was a German design company
that teamed with builder Howaltswerke-Deutsche Werft (HDW)
and trading company Ferrostaal AG to successfully export sub-
marines worldwide. It offered the IKL Type 2000 design, a devel-
oped version of a submarine that it had proposed earlier to the
United States Navy. IKL was a private submarine design company,
founded in 1946 by Ulrich Gabler, which had three customers:
the German government and the commercial submarine builders
HDW and Thyssen.
B U T H O W W I L L Y O U J U D G E T H E M ?
61
Even after re-armament in the mid-1950s the West German
navy ordered few submarines, so IKL and HDW turned to foreign
markets, becoming the world’s largest exporter of conventional
submarines. Between 1964 and 1984 they sold 46 submarines to
11 countries, representing over half of Western conventional sub-
marines, and they had built submarines in both India and Turkey.
Most of their exports were of the small Type 209, with the first
of the larger Type 1500 submarines still under construction for
India. In the early 1980s IKL and HDW were working on two new
types of submarine for the West German navy and were experi-
menting with fuel cells as a form of air-independent propulsion.5
The IKL/HDW bid was headed by Juergen Ritterhoff, the senior
designer of IKL. A short jovial man, Ritterhoff was a protégé
of Ulrich Gabler and was widely respected for his encyclopaedic
knowledge of submarine design.
Another German contender, Thyssen Nordseewerke, was part
of the Thyssen Group, one of West Germany’s largest industrial
companies. For its Australian bid Thyssen was linked with ship-
builders Blohm & Voss, experienced in managing export projects
in Norway
, Nigeria and Argentina. Like HDW, Thyssen’s subma-
rine business survived on export sales. In the early 1980s it was
building two Type TR1700 submarines for Argentina in its own
yards, with a further four boats to be assembled in Argentina from
kits.
Kockums, the Swedish submarine designer and builder, was
founded in the earliest years of Swedish industrialisation, starting
as a mechanical engineering workshop in 1840. It began ship-
building in the early 1870s and built its first submarines for the
Swedish navy in 1914. The company developed a reputation for
innovation, building the world’s first all-welded merchant ship in
1940 and the first super-tanker in 1962. From 1945 to the mid-
1970s Kockums was a major commercial shipbuilder, building
many of the world’s largest vessels with advanced modular con-
struction techniques. However, shipbuilding collapsed with the oil
crisis of 1974, and in 1978 Kockums passed into state ownership,
eventually becoming part of Celsius, a government-owned defence
company.6 Kockums’ submarines were designed for short-range,
shallow water operations. The V ästerg ötland class, then the lat-
est Kockums design, displaced only two-thirds as much as the
Oberons.
62
T H E C O L L I N S C L A S S S U B M A R I N E S T O R Y
Kockums’ bid was headed by Roger Sprimont, an adventurous,
buccaneering former submariner, whose charismatic leadership
and bold decision-making was a major reason for the company’s
success in winning the contract. He had been one of Sweden’s
youngest submarine commanding officers, and was the only
Swede to complete the British Perisher training course, with the
Australian submariner Rod Fayle as a classmate. In 1977 Spri-
mont was navy liaison officer at Kockums, which two years later
made him naval division marketing manager, and in 1982 head of
division, where he was involved in the Indian submarine competi-
tion. When the Australian project began he was initially sceptical
about Sweden’s chances, thinking the British would win automat-
ically, but when he was convinced that Sweden had a chance he
threw himself into the campaign.
Admiral Bill Rourke, chief of navy matériel, developed the
evaluation of the responses. Specialist teams assessed how well
each contender met the requirements in the areas of operational
