The Albanese government is embarking on the biggest major overhaul of the defence department in more than 50 years, with a new agency set to oversee projects with the aim of preventing cost blow-outs and years-long delays.
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As Australia ramps up military spending with an extra $70 billion allocated over the next decade, including for the AUKUS submarine deal, the government is setting up a new Defence Delivery Agency.
The agency, which aims to strengthen the nation's military forces capabilities, will be led by a national armaments director who will advise the government on acquisition strategies and delivery of projects once approved.
"As the Albanese government makes the biggest ever peacetime investment in Defence, it is important that we put in place the structures and systems to ensure Australia's Defence Force can deliver the capabilities we need at speed and within budget," acting Prime Minister and Defence Minister Richard Marles said.
"The establishment of the Defence Delivery Agency will elevate professionalism and strategic focus of Defence capability acquisition and sustainment,"
"It will drive stronger contestability, more accurate cost estimation and clearer accountability for the delivery of major projects."
The new agency will start operating on July 1 and will become an independent agency a year later. It will report directly to ministers and have control over its budget.
Once fully established, it will integrate three existing Defence capability and delivery groups: capability, acquisition and sustainment; guided weapons and explosive ordinance; and naval shipbuilding and sustainment.
Defence Industry Minister Pat Conroy said the new agency would "help ensure our industrial base is resilient, innovative and aligned with our strategic priorities".
"It will create more opportunities for Australian businesses and workers to contribute to Australia's national security," Mr Conroy.
He said the "increasing complexity of Defence capabilities, systems and platforms requires a systematic rethink of capability development and delivery system".
"This is about setting Defence up for success so we can modernise the ADF in line with the National Defence Strategy."
Defence will also centralise capability development functions in a move aimed at ensuring clearer prioritisation, streamlined decision making and accountability for new capability proposals.
The changes are intended to deliver greater project and budget management, cost estimation and assurance across the life of a project.
The government will begin work on the changes, including the design of the agency and a stakeholder consultation, immediately.
