Australia offers troops more cash bonuses to address defence shortfall

By Kirsty Needham

Australia will spend A$600 million ($395 million) on defence reserve recruitment and extending a cash bonus to retain troops as the centre-left Albanese government seeks to overcome workforce shortages, officials are expected to announce on Tuesday.

A review of Australia's defence force last year identified severe workforce pressures as a priority issue, even as the government lifts its defence budget to a record A$51.5 billion annually, revamping its northern military bases and acquiring long range strike capabilities.

A defence workforce plan expected to be released on Tuesday cites a competitive national labour market and record low levels of unemployment as putting pressure on defence's ability to recruit, according to excerpts viewed by Reuters.

A bonus scheme introduced last year will be extended until 2028 and expanded through the middle ranks, offering A$40,000 to defence force members who stay to "address hollowness in the force", the plan says.

The Department of Defence aims to achieve a permanent defence workforce of 69,000 by the early 2030s, with an overall combined defence and civilian workforce of around 100,000 by 2040, the plan says.

In June, there were around 57,000 permanent defence personnel, falling short of funded positions.

"Our ADF personnel are our greatest capability, which is why it is crucial that the Defence workforce has the people it needs to help protect Australia’s strategic interests," Defence Minister Richard Marles said in a statement.

Australia is spending up to A$368 billion to acquire nuclear powered submarines under the AUKUS partnership with the United States and Britain, and has also allocated A$74 billion for missile systems, as it responds to rising tensions with China in the Indo Pacific region.

On Monday, Australia cancelled a multibillion-dollar military satellite project with Lockheed Martin, saying it would instead shift its focus to a multi-orbit system to increase resilience for the Australian Defence Force.