Australia pours in $12 billion to support naval shipbuilding

September 15, 2025, by Fatima Bahtić

The Australian Government has decided to provide $12 billion (US$8 billion) towards delivering a defence precinct at Henderson to deliver continuous naval shipbuilding and AUKUS in Western Australia.

As disclosed, this early commitment of funding will provide certainty to the industry that will partner in the construction of infrastructure and facilities, and will also kick-start early works while more detailed planning and design work for Henderson is finalized.

This initial investment will underpin the delivery of:

The construction of surface vessels for the Australian Defence Force, starting with Army’s Landing Craft and, pending successful consolidation, the domestic build element of Australia’s future general purpose frigates;
Facilities to support the sustainment of Australia’s surface combatant vessels;
Contingency docking capabilities for Australia’s future conventionally-armed, nuclear powered submarine fleet from the early 2030s; and
Depot-level maintenance, including graving docks.

This commitment builds on the government’s initial $127 million commitment to progress planning for the Defence Precinct.

The government stated that additional funding requirements will be considered once detailed design works are finalized and as delivery models, including the opportunity for private financing models, are determined.

“The Albanese Government continues to increase defence spending to record levels to deliver the capabilities Australia needs. Henderson will be critical to Australia’s shipbuilding and sustainment industry while supporting continuous naval shipbuilding in Western Australia and Australia’s nuclear-powered submarine pathway,” Deputy Prime Minister Richard Marles stated.

“This investment is part of the Albanese Government’s commitment to building our sovereign defence industry and supporting a future made in Australia. Western Australia already plays an important role in the delivery of capabilities for the ADF, and the consolidation of the Henderson precinct will be a significant boost for defence industry in the West,” Minister for Defense Industry, Pat Conroy, said.

Last week, the government announced $1.7 billion (US$1.12 billion) investment to acquire a new fleet of extra-large autonomous undersea vehicles (XL AUVs), known as the Ghost Shark, for the Royal Australian Navy.