The federal budget will earmark more than $4bn to expand the range of the Australian defence force’s missiles and establish domestic manufacturing.
The government will announce the funding on Wednesday as it faces growing criticism from the Coalition for slashing the number of infantry fighting vehicles to help fund these newer priorities.
The $4.1bn allocation over the next four years includes $1.6bn for long-range strike capabilities and $2.5bn for local production of guided weapons.
The government said manufacturing weapons and their critical components would improve Australia’s self-reliance. Ministers would consider “concrete, costed plans” by the end of 2023.
The deputy prime minister, Richard Marles, said the government was “reshaping the Australian army and modernising it for the current strategic circumstances”.
“This investment in key capabilities will see the Australian army’s current range for artillery grow from 40km to in excess of 500km,” Marles said in a joint statement with the defence industry minister, Pat Conroy.
The latest announcement is part of a staged rollout of details from Monday’s defence strategic review, which warned that the ADF was structured for “a bygone era” and needed to project power further from Australia’s shores.
The government has estimated the cost of implementing the review’s recommendations will be about $19bn over the initial four-year budget period.
This includes $9bn towards the Aukus nuclear-powered submarines and now $4.1bn for missiles and manufacturing. That leaves about $6bn of allocations that have not been broken down yet, although further announcements are likely as the budget approaches on 9 May.
Labor argues the $19bn initial amount is fully funded, through a combination of existing budget allocations and $7.8bn in new savings within the defence portfolio.
In a statement on Wednesday, the government said it would accelerate the acquisition of additional high mobility artillery rocket systems, which have been among the most effective weapons used by Ukraine’s forces after Russia’s invasion.
The government will also speed up the introduction of battle management and support systems associated with Himars. It will accelerate the acquisition of precision strike missiles.
The other funding aims to get the guided weapons and explosive ordnance (GWEO) enterprise – which was initiated by the Morrison government – back on track.
The defence strategic review said long-range strike and other guided weapons were “fundamental to the ADF’s ability to hold an adversary at risk in Australia’s northern approaches”.
But the review found that the GWEO enterprise “lacks available financial resources over this decade and lacks the required workforce” and was “yet to produce a strategy”.
“While the establishment of the GWEO enterprise is appropriate, the manner in which it was established has inhibited its ability to achieve the stated goals of government,” the report said.
According to Wednesday’s statement, the enterprise will “manufacture selected long-range strike missiles and increase local maintenance of air defence missiles”. It will also make other types of munitions, including 155mm artillery ammunition and sea mines.
The government said the project would require an increase in Australia’s testing and research capabilities and a rapid expansion of its storage and distribution network. The decision doubles the investment for GWEO compared with what was previously allocated.
The Coalition agrees the ADF needs to project power further from Australia, but has criticised the funding shuffle over the first four years.
The shadow defence minister, Andrew Hastie, said it was “strategic doublespeak to talk up the big challenge that we’re facing as a country and then to not add a single new dollar to defence spending”.
The chief of the army, Lt Gen Simon Stuart, urged soldiers to adapt to “the rapidly changing character of war”.
In a video message to reassure soldiers, Stuart acknowledged they could face “some challenges” in modernising but said he was confident the army was up to the task.
