The federal government is making a $12bn “downpayment” on a shipbuilding facility in Western Australia to prepare it for future nuclear-powered submarines.
The Henderson defence precinct will cost $25bn over a decade and will be used to build surface vessels and to dock and sustain submarines including those to be delivered under the Aukus agreement.
Under the $368bn Aukus agreement with the US and the United Kingdom, Australia will buy at least three Virginia-class submarines from the US and build at least three new ones in South Australia.
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The Pentagon is reviewing the arrangement amid “very serious concerns” about it, but the Washington Post reported on Saturday that the US secretary of state, Marco Rubio, has told the defence minister, Richard Marles, the deal will go ahead.
Marles met his US counterpart Pete Hegseth, US vice-president JD Vance, and Rubio in August.
When asked after the meeting if Aukus was “as good as before”, Marles said “yes”. He said the government welcomed the review, that it was an opportunity to “look at how we can move forward more effectively and efficiently together”.
“It is moving ahead at a pace. It is on schedule, and we are really confident about its progress,” he said.
The Washington Post reported there may be “tweaks” to the timeline of the agreement.
Marles will join the prime minister, Anthony Albanese, defence personnel minister Matt Keough and WA premier Roger Cook to announce the Henderson plan on Sunday.
“Henderson will be critical to Australia’s shipbuilding and sustainment industry while supporting continuous naval shipbuilding in WA and Australia’s nuclear-powered submarine pathway,” Marles said in a statement provided under embargo.
The government said in the statement the commitment of funding to Henderson will give the industry certainty, and will “kickstart early works whilst more detailed planning and design work for Henderson are finalised”.
“This world-class precinct will create more than 10,000 local jobs and strong opportunities for local industry,” Albanese said.
“There is no greater honour than serving our country in our nation’s uniform and my government is dedicated to investing in the defence capabilities our nation requires.”
Marles said the government was increasing defence spending to “record levels”.
The US is demanding Australia boost its defence spending to 3.5% of GDP.
The $12bn will be used to build landing craft and “pending successful consolidation”, the domestic share of building a new fleet of frigates. It will also be used for maintenance facilities for warships, and have docking capability for the future submarine fleet.
The government is still negotiating the details of a $10bn deal with Japan to buy Mogami-class frigates to replace the ageing Anzac-class fleet. The first three will be built in Japan, then up to eight will be built at Henderson.
The Washington Post also reported that the second “pillar” of Aukus, which is focused on developing advanced technology such as robotics, quantum technology and artificial intelligence, will pivot to developing advanced weapons such as hypersonic weapons and autonomous drones.
“The idea was to focus on advanced stuff that can be in the air and water quickly,” a defence expert told the outlet.
Marles announced $1.7bn for a fleet of Ghost Shark autonomous submarines on Wednesday.
