High-level departmental advice to the government reveals its overwhelming preference was for Adelaide-based, government-owned ship builder ASC to do the bulk of the work.

The department's swift release of the ministerial advice under freedom-of-information laws adds to the intrigue and confusion around the government's seemingly ever-changing submarine policy.

Reports emerged last year that Mr Abbott had indicated to his Japanese counterpart Shinzo Abe that Australia was keen to have his country supply the submarines.

The comments directly contradicted the December 2013 advice to then defence minister David Johnston, which stated that the only options for Australia were to either produce an "evolved Collins" or to pursue a "new design".

In either case,  the Defence advice was unambiguous in recommending ASC as the only option for "assembly capability".

The advice, prepared in consultation with the chief of navy Vice-Admiral Ray Griggs, concluded: "The strategy for Future Submarine construction is to renew the dormant capability resident in ASC Pty Ltd and its facilities as a start point. However, as ASC lacks some skills and capital to undertake this large task alone, additional skills and resources should be introduced, ideally from Australian companies to maximise sovereignty."

Defence acknowledged that Australia lacked "whole boat design capability" and would require some international help with design.

"A range of approaches offer differing levels of sovereign control. At one end of the spectrum is for Australia to lead the design and support by the US and UK and at the other end is for a mainland European designer to lead."

The advice does not make any mention of Japan as a preferred builder or designer.

Replacing the Collins Class submarines has been a vexed issue for the Abbott government, which promised before the 2013 election to have the 12 new submarines built by ASC in Adelaide.

But last year Mr Abbott spoke about the project to the Japanese Prime Minister, and in November Mr Johnston made the astounding comment that he would not trust ASC "to build a canoe".

In February, with his leadership under pressure, Mr Abbott – according to undisputed reports by ABC's Four Corners – agreed to re-examine the government's yet to be publicly announced policy to build the bulk of the new fleet offshore in a bid to retain the support of SA Liberal Senator Sean Edwards.

The government has now invited Japan, France and Germany to submit designs for the new submarines, detail where and how it will be built and at what cost by the end of the year.

Mr Abbott has made no firm commitment on the level of involvement of Australian companies, but said value for money and Australian jobs would be priorities.

The December 2013 defence advice highlighted the importance of growing Australia's design capability and warned of the risk of "leakage of allied and Australian technology back to this design company", saying this "would need to be prevented, which may limit the extent such technology [is] incorporated into the initial batch of the Future Submarine".

The advice said the new submarines should replicate the capabilities of the Collins Class boats to maintain regional superiority. Defence also warned that "the need to preserve access to sensitive technologies from the US and UK, as well as the sovereign capability Australia requires to operate", were key elements of the project to ensure "appropriate degrees of national independence".

"This particularly applies to Australia's capacity to progressively incorporate its own stealth technologies into the Future Submarine."

To ensure Australia did not risk a "capability gap", the Defence advice recommended the Collins Class submarines operate five years longer than their planned withdrawal dates.

The government has committed to extending the operating life of the Collins. For the Future Submarines project to meet its 2031 deadline, a decision on whether the new submarines will be an evolved Collins or a new design would be needed by mid-2015, the documents show.

They also show Defence sought approval to engage several Australian companies as potential "Tier 1" participants in the submarine project and suggested a high-level advisory group be established to provide independent advice on "commercial construct options".

Defence suggested former Howard government defence minister Robert Hill as a suitable inclusion.

Fairfax Media was denied full access to separate ministerial advice from the Defence Department on the future submarines project on the basis it could harm Australia's international relations. The advice was an October 2013 project update from the head of the Defence Materiel Organisation on the evolved Collins option.

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