Wednesday, February 02, 2022

Australian navy's new ships are crap

A result of relying on the bungling British

Australia’s new $45bn Hunter-class frigates will be “substantially” slower, have a shorter range than originally intended, and could be vulnerable to detection by enemy vessels, a classified Defence Department report reveals.

The Defence “Engineering Team Assessment” of the frigates program, undertaken last November, warns the ships could also be less safe for crews, with the potential for sailors to become trapped below deck by floodwaters in “credible damage conditions”.

The 36-page report sets out an array of serious problems with the “immature” British design, which is being substantially modified to meet Australian requirements, and warns that the government’s contract with shipbuilder BAE Systems provides “very limited means … to influence contractor performance”.

BAE won the contract in 2018 to build nine anti-submarine ­frigates in Adelaide to replace the Anzac-class fleet, with the first ship due to enter service in 2033.

The company claimed its design was the most advanced and stealthy on offer. But unlike its competitors, Spain’s Navantia and Italy’s Fincantieri, BAE’s design was an unproven one.

Taxpayers could now face a drawn-out design and construction process – with escalating costs and delays – like those that dogged other recent Defence projects ­including the recently dumped French submarine program.

The report, seen by The Australian, is scathing in its criticism of the British contractor, which will be responsible for building the nation‘s nuclear submarines if Australia goes with the UK’s ­Astute-class boat.

It blasts slow feedback and “confusing and incoherent” provision of data by BAE, and says the company’s design process “does not adhere to normal system engineering practice”.

The report says Australian ­defence companies are being passed over, with BAE claiming local ­industry content requirements are “a complicating factor for system design maturity”.

The document, marked “sensitive”, warns that the inclusion of a US combat system and ­Australian-designed CEAFAR2 radar have pushed the ships’ “space, weight, power and cooling margins” to their limits, posing “significant potential risk”.

The proposed ships are now “substantially heavier” than BAE’s original Type-26 frigate ­design, which has also faced ­delays and design headaches, ­requiring a modified hull to ­accommodate the additional weight and design changes.

The report warns that the changes have caused serious ­design issues that have cascaded through the program, driving up electrical power consumption with “a negative impact on speed and range”, and causing problems with the cooling of the vessel’s combat system.

“The overall power demand of the Hunter-class frigate still ­exceeds its ­generating capacity … and is exacerbated in tropical and antarctic environmental conditions,” it says. “Vessel maximum speed at start of life will be substantially lower than comparable RAN surface combatants.”.

The report adds that the ­heavier-than-anticipated ship will face “increased fuel consumption and running costs, particularly in the 17-18 knots range”.

The shortfall in the vessel’s available power will force ­commanders to decide whether to “prioritise power allocation to ­either the CEAFAR2 Radar or the propulsion system depending on the ship’s operational requirements”, the authors warn.

The “System Design Review Exit” report says the ship’s mast design could increase its radar cross-section, and the ­additional thrust required from its propellers could breach the contract’s “underwater radiated noise” requirements, making the vessels more vulnerable to the submarines they are supposed to hunt.

The Defence engineering team says it has “low confidence” that the vessels will meet Royal Australian Navy weight-margin standards, leaving the first three ships potentially “unable to respond to technological surprise with future capability upgrades”.

It also warns that the new ­design of the ship’s topside mast is so immature that there is a risk it could destabilise the vessel “past the point where a feasible ship design is possible”.

The modified design’s ­additional displacement and draught have called into question previous assessments – based on the Type-26 – of its seakeeping performance. The need to fit in additional power and cooling equipment is reportedly degrading “the overall liveability of the ship‘s habitable space”, while the document warns of design compromises in the provision of fixed firefighting systems.

Last July, Defence Minister Peter Dutton approved a delay in commencement of construction on the first boat, from December 2022 to June 2024, but the report says this deadline is now tight.


Erratic output from renewables requires Australian government agency to spend a lot on bringing in other electricity supplies

Costs incurred by the body that keeps the lights on across Australia's major electricity systems are skyrocketing as surging levels of renewable energy increasingly challenge the security of the grid.

Following another year in which record amounts of renewable energy were added to the national electricity mix, the Australian Energy Market Operator (AEMO) is pushing for a big hike in funding to oversee one of its key jurisdictions.

The agency wants $156.2 million over three years to 2025 — a 66 per cent jump on the previous period – to operate the main electricity market in Western Australia.

In a submission to WA's economic watchdog, the AEMO said it needed the extra funds to help cope with the increasing complexity and volatility in the market as more and more renewable energy flooded onto the system.

"While the growing level of variable renewable generation is helping the [WA system] transition towards clean, low-cost generation, it can pose operational challenges," it said in its submission.

The proposal mirrors the AEMO's actions in Australia's biggest power system — the National Electricity Market (NEM) – where the organisation has faced steeply rising costs to stabilise a grid that services almost 10 million customers.

As part of its most recent snapshot of the market, the Australian Energy Regulator (AER) noted the AEMO was spending tens of millions of dollars on contingency measures to ensure the NEM did not run short of power at vulnerable times.

Much of the outlay was on back-up capacity — provided either by power plants that could generate electricity or major users who could scale back consumption when needed — for times when the grid was "under stress".

The AER noted that the so-called reliability and emergency reserve trader scheme had been in place for a number of years but had rarely been used until recently.

It said the scheme had now been invoked in all the biggest states, including South Australia, Victoria, New South Wales and Queensland, while its total cost between 2017 and 2020 had reached $110m.

On top of this, the regulator said the AEMO was having to intervene in the normal functioning of the market by calling on more expensive power plants that could help with the stability of the grid.

The regulator noted these interventions had "risen sharply in recent years" as the AEMO ordered some generators, such as gas-fired power plants, to stay on while telling others, including wind and solar farms, to back off at certain times.

These interventions had come "at significant cost to consumers", the AER said, with the AEMO shelling out $50m in 2018 and 2019 to compensate affected generators.

Despite efforts to control these costs, the AER noted they were higher still in 2020 at $66m.

"Aside from formal compensation, the use of constraints or directions penalises consumers by driving up wholesale electricity prices," the AER said in its report.

"For example, by restricting wind or solar output that might have zero marginal costs, AEMO directions may lead to dispatch from synchronous (coal- or gas-fired) generators with higher costs."

The AEMO said the growing challenges of keeping the lights on were highlighted in its latest snapshot of the market, which showed record volatility in the three months to December 31.

Minimum demand for electricity from the grid fell to new lows in SA, NSW and Victoria as cooler weather subdued demand and growing amounts of rooftop solar pushed out fossil fuel-fired generators.

Across the NEM, the average output of renewable energy also increased from 31.6 per cent to 34.9 per cent, with maximum output reaching as high as 61.8 per cent for a short time on November 15.

The AEMO said the combination of factors helped to push wholesale power prices into negative territory, where generators have to pay someone to take their electricity, a record number of times.

At the same time, the market body noted its own costs "remained elevated" for the quarter as it scrambled to ensure there was enough back-up to meet demand when renewable generation fell away or when there were other shocks to the system.

Synergy, the WA state-owned power provider that would be up for the biggest share of the AEMO's cost increase in the west, declined to comment.

The Australian Energy Council, which represents big electricity providers, said the AEMO's spending plan reflected the "dramatic shift in the energy mix and significant government reforms".

But the council also said it was critical to ensure the AEMO's spending was transparent to ensure it was kept to a minimum.

"WA's Economic Regulation Authority … plays an important oversight role [in the WA market] and we expect to make a detailed submission once the ERA has released its draft determination," a spokesman said


Many lessons to learn in improving education

Australia’s low ranking in education performance is one of the greatest dangers to our long-term national prosperity as we enter a new skills-based industrial ­revolution.

This national danger has triggered much-needed efforts to reform curriculums. But the NSW Productivity Commissioner Peter Achterstraat’s research reveals an even deeper problem: our systems of recruiting and training teachers are simply not working and he recommends fundamental change.

The Achterstraat plan concentrates on NSW but the teacher recruiting and training mistakes he isolates are duplicated around the nation.

The Achterstraat conclusions were publicised last year but over the new year break the NSW commissioner sent me a personal copy of his massive document entitled “rebooting the economy”. And to make sure I understood what was happening he highlighted key sentences!

And while I was looking at the education sections that dominate Achterstraat’s 370-page productivity document, across my desk came an article from Malcolm Elliott, the president of the Australian Primary Principals Association. Elliott was criticising NAPLAN but the thrust of his remarks showed that those at the top of the teaching profession do not recognise the validity of Achterstraat’s warning.

Accordingly, we are headed for a nation-changing debate that will determine our future. I hope both major political parties address the education crisis at the next federal election.

Around the nation many parents don’t have Achterstraat’s research but recognise that something is wrong in the way their children are being taught the basics.

Some are paying large sums to buy dwellings in selected catchment areas so they can send their children to a government school that they believe has attracted excellent teachers who excel in teaching the basics – reading, writing, science and mathematics. Others with the same view send their children to selected private schools.

Achterstraat does not make detailed evaluation of curriculum issues but says NSW needs to ­redesign and modernise its curriculum, providing strong foundations for lifeline learning. It needs to cut “inessential teacher workloads” so teachers can focus on the core of their jobs: teaching our children.

The NSW experience shows that simply spending money on education does not solve the problem.

Federal and state governments increased spending on each NSW student by 22 per cent in the decade to 2018-19 but not only did NSW performance decline but states like Victoria, where less money was spent, performed better than NSW.

The proportion of NSW students failing to achieve minimum standards across the three PISA (Program for International Student Assessment) domains has risen from 32 per cent in 2006 to 42 per cent in 2018. Achterstraat believes these bad educational outcomes are surface manifestations of fundamental flaws in teacher recruiting and training.

He emphasises that the quality of our schooling system ultimately rests on the quality of classroom instruction by our teachers and school leaders. Learning is usually determined by how teaching is delivered in classrooms and how the curriculum is conveyed to students.

I isolate some of the areas where Achterstraat says the system is failing and then summarise some of the Achterstraat solutions which would revolutionise Australia’s teacher recruitment and training. The faults:

* Australia has introduced waves of reform demanding that new teachers must meet increased academic requirements to enter initial teacher education programs.

But these more onerous and longer qualifications for new teachers have unintentionally raised barriers for talented people entering the profession.

Worse, the evidence suggests that the educational gains from longer teaching pathways are minimal or even nil.

* Some teachers realise that they are poorly suited to teaching only upon entering the classroom and extra university training delays this discovery. The messages from their bad experience adversely impacts teacher recruitment.

* Like any other worker, a teacher cannot improve “without setting goals, striving to achieve them and receiving insightful, regular and constructive feedback plus correctional help”. But currently goals and benchmarks are often poorly defined, making it very difficult to identify relevant evidence and measure performance against them. A teacher with relatively low-performing students may be driving strong improvement while a teacher with high performing students may not be contributing much to their performance.

* Australia is not matching the world in high-performing education systems to supplement standardised teaching, with indicators that help show what teachers and schools are contributing to student learning growth.

* In many areas of Australia, including NSW, teacher standards and teacher accreditation has seen weak implementation and there is only a loose link between creditation and teacher effectiveness. It becomes difficult to identify relevant evidence and measure performance against them.

The solutions:

* Given the teacher entry system is not working as planned, it needs to be reviewed to make it less onerous, but identifying better teaching prospects and broadening the source of quality teachers with employment-based teaching pathways.

* Systems of classroom observations including peer-to-peer and supervisor observations need to be implemented.

* A separate set of aims should be established for school principals that reflect their unique role and makes them accountable for improving school teaching. They must report annually on the implementation of these performance measures.

Australia’s problem is that we have a substantial number of teachers who have not been trained along these lines and will vigorously oppose it.


Britain's backdoor tax on Australian wine

Because Australian wine tends to be more alcoholic than other wines, the British want to tax it more

Treasury Wine Estates, the largest producer of Australian wine bound for the British market, has begun lobbying for the British government to reconsider a new tax regime for wine imports – one the company says will wipe out any benefit from the free trade agreement.

In a submission to British Treasury officials, TWE chief executive Tim Ford writes that the company supports the objectives of the new tax system – an attempt to simplify complicated alcohol duties – but says the result will largely penalise Australia for its climate, soil and grape ­varieties.

Mr Ford also warns that the current proposal is not workable in practice because the alcohol content in Australian wines can shift several times a year, making measurement and labelling ­difficult.

Australian winemakers are warning that the overhaul of alcohol duties, increasing the tax paid on drinks with an alcohol content higher than 11.5 per cent, will make their products more expensive and drive away British consumers. Britain is the largest export destination for Australian wines.

The submission notes that 62 per cent of TWE’s sales by volume have an alcohol content of between 12 and 15 per cent. Euro­pean wines have a far lower alcohol level. TWE, whose global brands include Penfolds, Wolf Blass and Lindeman’s, says that the new regime is unfair.

The submission states: “Environmental conditions largely determine alcohol content in wine and are not readily modified after grapes are harvested. Hence, unlike some other beverage types that can innovate towards lower alcohol content, an increased duty burden placed on higher alcohol still wines (is) inherently a tax unavoidably borne by Australian producers.”

“Under the current proposal … the average price of Australian wine imports to the UK will rise, and to such an extent that the forecast price drop for Australian wine resulting from A-UKFTA will be completely reversed,” it reads. “A standard bottle of almost any Australian wine would be more expensive in the UK, not cheaper, as had been hoped by TWE when A-UKFTA was first proposed.

“TWE believes that further work needs to be done to modify the proposed new duty tax system to ensure that non-tariff, ‘behind the border’ measures do not distort the impact from the reduction in tariffs and retail prices that would result from A-UKFTA’s introduction.”

TWE has engaged CT Group, previously Crosby Textor, for advice during the consultation process, as it considers how to lobby British parliamentarians. CT has extensive links with both the Morrison government and Boris Johnson’s administration in ­London.

Under the British proposal, the tax impost would increase with every 0.5 per cent increase in the alcohol by volume. In its submission, TWE argues that this should be increased to every 1 per cent – meaning wine producers would pay on average 10p per bottle less for every band increase.

TWE has also asked for labelling to allow for a wider variance from the alcohol content in the bottle – permitting up to 1 per cent rather than the proposed 0.5 per cent. By increasing the margin for error in labelling, producers could more easily fall into a lower taxing band.

The TWE submission points out that the proposed 0.5 per cent band is in keeping with strict European Union standards, which it says is out of step with the rest of the wine-producing world.

A labelling tolerance of 0.8 per cent was agreed to under the Australia-UK free trade agreement. This is already lower than the amount permitted in the Australian market: 1.5 per cent.

The submission states: “That the UK would want to simply maintain an approach more akin to the EU’s wine regulations, and for no perceivable benefit, seems antithetical to the stated objective of the current duty reforms.”

Australia is the clear market leader for British wine imports, with a 23 per cent share in the year to September 2021. Italy follows with a 13 per cent share.

Because much of the Aussie wine exported is in bulk and later bottled in Britain, TWE argues that by making life harder for Australian producers, Britain could be hurting its own manufacturing industry.

This is point not lost on the British Wine and Spirit Trade Association.

In its January submission to a British committee inquiry it noted: “Australian wine is the number one ‘country of origin wine’ on the UK market by volume, supporting an extensive range of jobs throughout Britain, from bottling and logistics to marketing and retail. It is a vital import to the UK economy and worth £1.5bn in UK sales.”




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