by “I don’t know if it was explicit or not but the view was made pretty clear,” one said.
Another source said the relationship between the government and Naval Group “had got to the point that the viability of the program was in question”.
Asked whether the government wanted Mr Billig gone, the Defence Department said “the appointment of Naval Groups senior executives remains a matter for the company”.
Defence’s general manager of submarines Greg Sammut said the department had worked “collaboratively” with Naval Group during Mr Billig’s tenure to implement the Strategic Partnering Agreement.
“This included progressing the program towards the key milestone of Systems Functional Review, in parallel with many other activities to prepare for construction and delivery of the future submarine fleet. These have been critically important achievements,” Mr Sammut said.
“We look forward to continuing our collaborative work with Naval Group at all levels, which remains essential to the success of the Future Submarine Program.”
Any further delays in any aspects of this program are unacceptable and put our nation at risk.
Matt Keogh, Labor defence industry spokesman
Naval Group and the government had clashed over multiple issues, including the design of the submarines and responsibility for warranty faults that may emerge, the potential snubbing of Australian firms from the supply chain and early construction costs.
Earlier this year, Defence Minister Linda Reynolds extracted a commitment that 60 per cent of the contract spend in Australia would go to local companies in response to fears they would miss out.
There have been also concerns over differences between the Australian and French corporate cultures, something Mr Jenkins has been brought in to try to bridge given his years working locally for Thales, a French-owned defence contractor. Thales is a minority shareholder in Naval Group, predominantly owned by the French government.
Mr Peever has some knowledge of defence, having chaired the First Principles Review in 2014 that looked at its organisational structure.
One source said both Defence and Naval Group were unhappy over their contract. The bad publicity the project was attracting was also hurting Naval Group as it pursued international defence contracts.
Opposition defence industry spokesman Matt Keogh warned the ongoing turmoil needed to be addressed.
The Future Submarine project is Australias biggest defence purchase ever, so it is very concerning the Morrison government still hasnt negotiated the 60 per cent Australian industry content requirement into the Strategic Partnering Agreement already and a change of management at Naval will probably set that back even further,” he said.
Frankly, any further delays in any aspects of this program are unacceptable and put our nation at risk.”
In an email to staff announcing Mr Billig’s departure from the project, Naval Group chief Pierre Éric Pommellet noted Mr Billig would “share his experience of the program and of the client” with his successor.
One source said Mr Billig had been effectively demoted, losing his place on Naval Group’s executive committee and moved to a strategic adviser role for the company’s bid for the Dutch navy’s submarine contract.
