Canberra, 20 November 1962
Confidential
Australian Defence Programme, 1962–65
On the 24th October, the Honourable A. G. Townley, M.P., Minister for Defence, outlined in the House of Representatives the Australian defence programme for the three financial years 1962–65. Copies of this statement have already been sent to your Department and to the Ministry of Defence but, for ease of reference, I attach a copy.1 now have the honour to attach also a note 1 by Major-General Kendrew, the Head of the British Defence Liaison Staff and my Senior Service Adviser, which discusses and analyses Mr. Townley’s statement and the debate which followed it.
2. I am in general agreement with Major-General Kendrew’s comments, but I thought it might be useful if I expanded a little on some of the political aspects of the statement which are not fully discussed in the note.
3. The Australian defence programme, as you will know, goes in three-year cycles, and in my despatch No. 19 dated 30th December, 1959 I reported briefly on the programme which was completed on 30th June, 1962. I think it fair to say of the programme just announced that it is very much the mixture as before. It is true that there have been some modest increases in the sums made available for defence, but, taking into account the higher costs both of men and materials compared with 1959, these have not significantly strengthened Australia’s defences. For this reason, and the more so because the debate took place, unfortunately for the Government, at a time when tension was running high over Cuba,2 there has been a good deal of public criticism (particularly in the Sydney Morning Herald group of newspapers and amongst organisations such as the influential Returned Servicemen’s League, but not excluding some of the Government’s own supporters in Parliament) of the fact that the Australian Services are being run, as General Kendrew remarks, on the cheap. There is undoubtedly something in this; we know that during the ANZUS Council Meeting last May Mr. Rusk3 did his best to persuade Australia to shoulder a larger share of the defence burden in South-East Asia, without a good deal of success. This new programme cannot have given much reassurance to Washington on that score.
4. Australian defence policy is based, in descending order of importance, on the ANZUS Treaty, the South-East Asia Treaty Organisation, and ANZAM. Of these, the former is increasingly referred to as the ultimate guarantee of Australian security; Mr. Menzies described it last week as ‘increasingly the sheet anchor of Australian security’. SEATO is valued in the main because it is the instrument whereby American involvement in the mainland of South-East Asia is assured in the event of hostilities. ANZAM as such is becoming of progressively less importance. Within the framework of those Treaties, Australian defence policy is designed in concert with its allies to keep Communist aggression as far away from Australia as possible.
5. Since the 1959 programme, however, a number of developments in Asia have brought the threat of Communism rather closer to Australia. The situation in the former Indo-China has deteriorated in Australian eyes—Cambodia is more neutral than ever, Laos has now been neutralised and, Australians think, sold out to the Communists, and the situation in South Vietnam, though apparently showing temporary signs of improvement, cannot be viewed with complacency in the long term. But most significant of all in the eyes of many Australians is that with the departure of the Dutch from West New Guinea, they now have for the first time a common frontier with a populous and potentially aggressive Asian Power, whose ultimate intentions are not yet clearly discernible. Moreover, the Chinese attack against India4 has forcibly reminded Australians of the aggressive nature of Chinese Communism; and the Chinese reaction to the Cuban affair is being interpreted here as a sign that the restraining hand of Moscow on Chinese policy is no longer as effective as it once was. All this has left a feeling of disquiet in Australia and has thus led to a rather more critical attitude to the Government’s defence policy than is usual in this easy-going country. Although the Government have made it clear that, in their view, Indonesia does not present an immediate threat, despite the increasing supplies of arms she has been receiving from Communist bloc countries, the Government’s critics do not feel that sufficient account has been taken of the potential danger from Indonesia. This feeling is probably most acute in the Northern areas of Australia, and Mr. Townley felt it politic to make a special reference in his speech to the defence of that part of the Continent.
6. The fact is that a country like Australia is in something of a dilemma. She has a long coastline to defend and a small population; she, nevertheless, wishes to play an appropriate part in the defence arrangements of which she is a member, but for political reasons Ministers are unwilling or unable substantially to increase the amount of the national income to be devoted to defence. If they could rely completely and unreservedly on their American allies to come immediately to the defence of Australia if it were directly threatened, the Australians might have taken the risk of putting all their eggs into the basket of forward defence by stepping up their potential military contribution in South-East Asia. But, partly because of domestic political consideration and partly because of doubt whether they could ultimately rely on the unquestioning assistance of America, they have been compelled to split their effort, and while providing for an effective Australian contribution in the event of a limited war in South-East Asia, they have also tried to provide adequately for the defence of Australia. This has split their defence effort in a way which makes it questionable as to whether they can carry out adequately either of these obligations.
7. As the defence debate showed, the Labour Party is now taking a more realistic view than in the past. I would not entirely agree with Major–General Kendrew’s description of official Labour policy as one of non-interference in South-East Asia although that was the policy expounded in the debate. They have admittedly been less than robust in their attitude to SEATO but Mr. Calwell5 (the Leader of the Opposition) made it quite plain only last week outside the debate that the next Labour Government fully intend to honour the nation’s Treaty obligations. He said that he wanted to put the record straight; the Labour Party was not neutral, isolationist or pacifist; it was intensely pro-Australian and wanted an Australian defence force that was adequate and efficient. This forthright statement was provoked by Mr. Menzies’ charge that if the Labour Party came into power, with its policy of a nuclear-free Southern Hemisphere, Australia’s relations with the United States would suffer an irremediable blow and that the Labour Party would cancel the ANZUS Pact.
8. Apart from these general considerations on the new defence programme, most detailed interest has centred on the two decisions not, at this stage at any rate, to replace the Canberras which comprise Australia’s bomber force, or to create a submarine arm in the Royal Australian Navy. But within a few days of Mr. Townley’s statement both the Minister for Air and the Minister for the Navy were at pains, in answer to Parliamentary Questions, to explain that the flexibility of the three-year plan would enable both these decisions to be reconsidered should that become necessary.
9. To conclude, Sir, I would say that certainly as long as the present Government remain in power Australian strategy will continue to be based on the need to contain Communism away from Australia. But the effectiveness of their contribution will be limited not only by the total amount of money provided for defence but also by the amount devoted to defending Australia itself. How far this strategy, and the contribution needed to make it effective, would be maintained under a Labour Government is not easy to predict. But my own feeling is that Mr. Calwell, if not some of the more left-wing members of his party, is fully aware of the Communist threat to Australia though he might look for other means, such as United Nations action, to combat it and rely less than do the present Government on SEATO.
10. I am sending copies of this despatch to the British High Commissioners in Ottawa, Wellington, New Delhi, Karachi, Colombo, and Kuala Lumpur, to Her Majesty’s Ambassadors in Washington and Djakarta and to the United Kingdom CommissionerI am sending copies of this despatch to the British High Commissioners in Ottawa, Wellington, New Delhi, Karachi, Colombo, and Kuala Lumpur, to Her Majesty’s Ambassadors in Washington and Djakarta and to the United Kingdom Commissioner–General in South-East Asia General in South–East Asia.
1 Not published.
2 A reference to the Cuban missile crisis, October–November 1962.
3 Dean Rusk, US Secretary of State, 1961–69.
4 A reference to the Sino-Indian border war, October–November 1962.
5 Arthur Calwell, Leader of the Australian Labor Party, 1960&edash;67.
[UKNA: DO 164/39]