Cairns Marine Precinct

BRIEFING NOTE SUMMARY
  • The Cairns Marine Precinct is a national defence asset that employs 4600 people.
  • A State policy commitment is sought to position Cairns as a Regional Maintenance Centre for the Royal Australian Navy.
  • With the HMAS Cairns expansion scheduled to start in 2023, a stage 2 Federal commitment is sought requiring two tranches of investment: (i) $25 million with $1 million to be allocated to a precinct-wide business case; and (ii) on completion of the business case, $100 million to support delivery of the recommended actions.
  • Commitment is also sought to secure the long term, continuous maintenance and sustainment programs for at least four Offshore Patrol Vessels in Cairns.
  • Investment complements the Queensland Superyacht Strategy 2018-2023 and the growing Defence requirements of Australia’s Step-up to the Pacific initiatives.
THE ISSUE

The Cairns Port is a critical enabler of the Tropical North Queensland (TNQ) economy, with the region welcoming the Federal Government’s commitment to base at least four new Offshore Patrol Vessels (OPVs) in Cairns over the next decade. The sustainment and maintenance of vessels in northern Australia aligns well with existing shipbuilding commitments in southern Australia, and complements the strategic objectives of Australia’s Step-Up to the Pacific foreign policy initiatives.

As a national naval sustainment and maintenance hub, the Cairns Marine Precinct currently services vessels from HMAS Cairns, Darwin, the United States and the Pacific Islands. The significant Defence and Border Force contracts managed out of the precinct ensure a skilled, permanent marine and engineering workforce of 4600 people is retained year-round. The economic significance of the precinct is reflected in the shipbuilding and repairs sector specialisation ratio of 24.24 (Cairns LGA).

In addition to servicing Australia’s Defence fleet, Cairns is home to a large and diverse marine sector with 1603 commercial vessels registered across tourism, fishing and shipping, and an active cruising yacht squadron. The precinct also plays host to superyachts and cruise liners visiting the Pacific.

To retain its vital workforce and meet the needs of this growing sector, Cairns requires additional marine maintenance and sustainment capability. This will enable the precinct to continue to service Defence, Border Force and industry needs while providing growth, jobs and a secure future for TNQ families.

Under an existing $24 million Federal Government commitment, Stage 1 of a Cairns Marine Maintenance Precinct upgrade has delivered wharves, hardstands, slipway extension and service upgrades.

A commitment of $125 million is now sought for Stages 2 and 3, which will lead to significant increases in precinct capacity and complement the Department of Defence $420 million commitment to expand the HMAS Cairns naval base. Stages 2 and 3 will also complement and support the Queensland Superyacht Strategy 2018-2023 and the Ports North Master Planning process.

 

BACKGROUND

The Cairns Marine Precinct has serviced the Defence, Border Force and marine industries for many years and as home to Fleet Base Pacific (HMAS Cairns), is one of the few ports in Australia that can offer the Department of Defence significant expansion opportunities in berth and land facilities.

Under the Security of Critical Infrastructure Act (2018) the Cairns port is a critical national infrastructure asset. It is the northern-most naval base on the eastern seaboard and plays a key strategic role in Australia’s northern naval capability. In acknowledging this role, in 2017-2018 the Federal Government committed to upgrading the precinct through staged investment.

HMAS Cairns employs about 900 Navy and civilian personnel, and provides administrative, logistic and maintenance support to nine homeported vessels, consisting of one Armidale Class patrol boat, two Cape Class patrol boats, two Leeuwin Class hydrographic survey ships and four Paluma Class survey motor launches. Cairns also provides support for Pacific Class patrol boats operated by neighbouring Pacific nations.

To develop additional wharf space and support infrastructure within HMAS Cairns, the Federal Government has pledged $420 million through the Navy Capability Infrastructure Sub-Program to support the delivery and home porting of the Arafura Class OPVs. $300 million will be invested in initial upgrades to construct new facilities at HMAS Cairns, with works to commence early 2023 and be completed by 2025.

It has been calculated that for every dollar spent on Defence in Cairns, the multiplier effect equates to over $5 in other sectors of the economy. A Defence investment of $420 million will therefore have an impact of $2 billion on the TNQ economy.

 

NEXT STEPS

In November 2019, the Maritime Systems Division announced Cairns as one of three Regional Maintenance Centres for the Australian Navy, with the other two locations being Perth and Darwin.

Federal commitment is now sought to secure the long term, continuous maintenance and sustainment programs in Cairns for OPVs, Pacific Patrol Boats, Armidale Class Patrol Boats and Custom Cape Class Patrol Boats to complement existing contracts for Hydrographic Survey Vessels and Survey Motor Launches. This commitment will:

  • Leverage the Cairns Marine Precinct’s current capability, ensuring value for money for the State and Federal Governments
  • Support job creation and economic growth for TNQ
  • Offer a continuous Naval patrol boat sustainment solution
  • Provide industry continuity and sustain marine capability to service Step up to the Pacific project initiatives from Cairns
  • Support ongoing innovation and development of marine industry expertise in northern Australia

In addition, to ensure that Cairns Marine Precinct infrastructure meets the future needs of Defence and industry, Federal investment is sought for Stages 2 and 3 of the precinct upgrade. Stage 2 requires $25 million, with $24 million to be shared across each of the three slipways in 2020 and $1 million to be invested in developing a precinct-wide business case. Stage 3 requires $100 million to support delivery of the recommended actions.

Note: The specialisation ratio referred to above is measured by comparing an industry’s share of total employment in a particular regional economy with the corresponding share of total employment for the overall Queensland economy for a given time period. An industry recording a ratio above 1.2 is considered ‘specialised’ in terms of employment, indicating its comparative importance (Department of State Development, Manufacturing, Infrastructure and Planning. Manufacturing Hub Delivery Model: Cairns, Townsville, Rockhampton. November 2018).

OUR RECOMMENDATION
  • That the Department of Defence delivers on the initial $300 million upgrade of HMAS Cairns by 2025, with the remaining $120 million to be invested by 2026 to support the home porting of at least four, and preferably six, Offshore Patrol Vessels (OPVs), including associated sustainment and maintenance work.
  • That to further develop the Cairns Marine Precinct, the Federal Government commits $125 million for stages 2 and 3 of the precinct, delivering a strategic national Defence asset that meets the security needs of Australia in the Pacific region.
  • That the Federal Government commits to a long term, continuous maintenance and sustainment industry for Defence and Border Force vessels in Cairns.
  • That the Queensland Government adopts and promotes a policy position strongly supporting Cairns as a Regional Maintenance Centre for the Royal Australian Navy.
  • That through the Ports North Master Planning process, the Queensland Government delivers a strategic roadmap for Cairns that caters for the long-term needs of Defence and industry.

PROPONENTS: Advance Cairns, Tropical Reef Shipyard, Norship, BSE Maritime Solutions
PRIORITY: Infrastructure
COUNCIL: Cairns
STATE ELECTORATE: Cairns
FEDERAL ELECTORATE: Leichhardt