Next generation of Australian submarines to be build overseas

Australia's next generation of naval submarines will not be designed or built in Australia, defense minister Kevin Andrews announced on Friday.

The revelation came two weeks after there were strong indications from party leaders that the lucrative, multi-billion- dollar submarine contract would be given to South Australian company, Australian Submarine Corporation (ASC).

Andrews said the "competitive evaluation process" would be open to overseas bidders from France, Germany and Japan.

Last week, the government said that the competitive evaluation process would be open to ASC as well as international bidders, something which sparked outrage from South Australian senators and the opposition alike, who believed that contract would be awarded to ASC.

They accused the government of using ASC as a "bargaining chip" for votes with the Australian people.

Andrews maintained that 500 jobs would be created in South Australia despite the contract being given to an overseas company. "The government expects that significant work will be undertaken in Australia as part of the build phase of the future submarine including, but not necessarily limited to, combat-system integration, design assurance and land-based testing," he said. "This will result in the creation of at least 500 new, high- skilled jobs in Australia for the life of the program, the majority of which will be in South Australia."

"So this is good news for Australian industry, it is good news for the Australian economy, it is particularly good news for Australian jobs and can I say to anybody in South Australia who may be listening or watching, this is particularly good news for South Australia."

The opposition has slammed the decision, saying that the government has broken pre-election promises to use the local company to build the submarines. Endi