The federal government has announced a major strategic review of the Australian Defence Force to ensure it's well positioned to meet future security challenges.
The review, the first since 2012, will be conducted alongside the consultation process for the AUKUS agreement with Australia set to decide whether to purchase nuclear-propelled submarines from the United States or the United Kingdom.
"The timing of that is important because it means this will run concurrently with the exercise we're currently undertaking with the United States and the United Kingdom under the banner of AUKUS around the selection of Australia's future submarines," Defence Minister Richard Marles told reporters in Canberra on Wednesday.
"Given the significance of that platform, it's really important that both bodies of work happen concurrently and are able to cross-pollinate each other.
"Together, these bodies of work are going to lay the foundations for defence policy for our country for decades to come."
The review will be led by retired Air Chief Marshal Sir Angus Houston and former Labor defence minister Stephen Smith.
They will undertake the most comprehensive reassessment of the military in 35 years in the face of potential "state-on-state conflict".
Their recommendations on the ADF's structure, force posture and preparedness from 2023 to 2033 and beyond will be presented to the government by March 2023 at the latest.
Mr Marles said the review will also consider how Australia's capabilities can be "better integrate and operate" with the US, the UK and other key partners.
"This will be the most significant review that we've seen of our defence force in decades," he said.
"This will look at questions of force structure, look at questions of capability.
"It'll ask and answer foundational questions about given our strategic circumstances: what is it that we want our defence force to do on behalf of our nation in this moment?"
The review will be informed by intelligence and strategic assessments of the most concerning threats to Australia's security to "re-assess the capabilities and posture of the ADF and broader Department of Defence".
Sir Angus outlined the changing circumstances which led to the need for updated capabilities.
"It's absolutely imperative that we review the current strategic circumstances which I rate the worst I have ever seen in my career and lifetime," he said.
"A land war in Europe, all sorts of issues in northeast Asia, particularly around Taiwan, east China Sea, issues in southeast Asia and issues up on the Himalayan border and northern India.
"It's something that is absolutely necessary."
Prime Minister Anthony Albanese said it was not about cutting funding.
"The government has made it very clear that we will have defence spending maintained at least two per cent of GDP (gross domestic product) and I have also indicated ... I expect that to rise in the future, not fall," he told reporters.
Mr Marles said the 10-year schedule of defence procurement needed to be "fit for purpose".
Sir Angus joined the air force in 1970 before rising through the ranks to become Chief of Air Force in 2001.
In 2005, he was appointed Chief of the Defence Force, before retiring in 2011.
