Aus should have just one ship building yard, says SA minister

Australia should have just one shipyard that builds ships and it should be located in Adelaide, according to South Australian Defence Industries Minister Martin Hamilton-Smith.

Hamilton-Smith told the ABC the nation can’t afford to have more ship building facilities elsewhere.

"It can have other shipyards that build modules and that sustain ships but I think we can only have one major shipyard in the country and it must be Osborne, South Australia,” Hamilton-Smith said.

"I think we need to see the submarines, the frigates and the patrol vessels and even the pacific patrol vessels constructed in one location to ensure that we reduce that valley of death and keep that workforce engaged."

The ‘valley of death’ is an expected period between contracts when ship builders will have no work to keep employees occupied.

Adelaide-based Shipbuilder ASC, the company Hamilton-Smith would presumably like to see as Australia’s sole ship builder, has cut 300 jobs since May. The company currently employs 2600 full-time workers as well as a large number of sub-contractors.

However, the company’s interim chief executive Mark Lamarre told a Senate estimates hearing in Canberra last week that it will be forced to cut 500 more jobs by the end of 2016 unless it wins more naval contracts.

The company and the South Australian Government are still waiting on who will be chosen to build Australia’s next generation submarines.

Prime Minister Malcolm Turnbull will meet South Australian Premier Jay Weatherill in Adelaide and the subject will be on the agenda.

Japan, France and Germany are all bidding for the project but it is not yet known if there will be a local build, a foreign build, or a hybrid of local/foreign build.