ANAO Audit Reveals Defence's Munitions Contract Management

Department of Defence

The Australian National Audit Office (ANAO) has completed the first of two performance audits into Defence's procurement process to establish the Strategic Domestic Munitions Manufacturing contract in the period 2016-2018. The audit also reviewed the precursor arrangements.

The ANAO has identified important governance failures and probity gaps.

Defence takes these findings very seriously and is committed to taking appropriate action to address the findings of this audit. As Chief of Guided Weapons and Explosive Ordnance I commit to addressing these findings and fully support the Secretary and Chief of Defence Force's response to the audit, as set out in their letter to the Acting Auditor-General of 7 June 2024:

We accept the findings and the recommendations of the report. The identified issues are not evidence of the standard expected and we commit to their remediation through the continual education and training of staff. This includes an increased focus on the recording of decisions and compliance with Defence's record keeping policies.

Over the past eight years, since the activities in the audit occurred, Defence has taken significant steps to improve procurement policy assurance, governance arrangements and effective records management. Defence has also taken measures to strengthen its integrity frameworks including how it works with Defence industry.

The newly formed Guided Weapons and Explosive Ordnance Group has also adopted these efforts and will continue to support the broader Defence enterprise efforts.

Air Marshal Leon Phillips, OAM

Chief of Guided Weapons and Explosive Ordnance Group

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