A former Labor Defence Minister and a Chief of Defence who served under him will conduct a strategic review of Australia's military for the first time in a decade, with recommendations to be made within five months.
The Albanese government has announced Stephen Smith, who was Defence Minister between 2010 and 2013, will join retired Air Chief Marshal Sir Angus Houston in overseeing the comprehensive study of the ADF's structure, preparedness and investments.
Prime Minister Anthony Albanese says the review will ensure the Australian Defence Force (ADF) is "well positioned to meet the nation's security challenges over the next decade and beyond".
"Professor Smith and Sir Angus bring a unique blend of knowledge and experience to their role as independent leads," Mr Albanese said.
"Their depth of expertise will be invaluable in informing the review."
Defence Minister Richard Marles said the Morrison government's Defence Strategic Update of 2020 found changes in Australia's strategic environment were accelerating more rapidly than predicted in the last Force Posture Review in 2012.
"This necessitates an immediate analysis of where and how Defence assets and personnel are best positioned to protect Australia and its national interests," Mr Marles said.
"It also requires an assessment of Defence's force structure and Integrated Investment Program.
"Exploring how our capabilities can better integrate and operate with the United States, the United Kingdom and other key partners will also be an important element of the review."
Inside ADF ranks Stephen Smith's appointment to lead the Defence Strategic Review is considered controversial given cuts to military spending and project cancellations which occurred when he was Minister.
Air Marshal Sir Angus Houston served as Chief of Defence between 2005 and 2011, and was knighted in 2015 for extraordinary service to Australia, particularly for his role in the aftermath of the MH370 and MH17 disasters.
According to the Terms of Reference released by the government, the review will be completed for National Security Committee of Cabinet consideration "no later than March 2023".
It states that the latest review is needed because "military modernisation, technological disruption and the risk of state-on-state conflict are complicating Australia's strategic circumstances."
"The review is to be a holistic consideration of Australia's Defence Force structure and posture by including force disposition, preparedness, strategy and associated investments, including all elements of Defence's Integrated Investment Program," it said.
Earlier this year Labor matched the former government's pledge to boost the number of uniformed personnel to almost 80,000 by 2040, amid strategic risks posed by China and Russia.
