Former defence minister Kim Beazley has called for a dramatic increase in military spending, warning Australia could be "lost" if not enough is done to prepare the country against threats.
Appearing at a UNSW conference discussing the AUKUS partnership, the one-time Labor leader also suggested Australia could help break China's dominance of the global supply chain in rare earths.
Mr Beazley, who served as ambassador to the United States for six years, noted that although defence spending is close to two per cent of Australia's GDP, the National Disability Insurance Scheme now accounts for more of the federal budget.
"This year our expenditure in the budget on disability insurance surpassed our spending on defence – there needs to be a truly massive smartening up here, and if AUKUS can do that for us, that would be a very good thing indeed," he said.
The influential Labor figure said the AUKUS strategic partnership with the UK and US presents a good opportunity to lift defence spending from the current level of around six per cent of the budget up to eight or nine per cent of overall government expenditure.
Speaking to the ABC's Afternoon Briefing program after his Canberra address, the former defence minister expanded on his comments.
"I was not criticising the disability insurance – that's been a really important addition over the last couple of decades to our social base, in a very important area," he said.
"But I think that it would come as a surprise to people, which is why I used the figure, that that particular element of our social policy now exceeds the defence function.
"Whenever you hear people talk about defence they say 'the cost of one F-35 will allow us to do this or that' — well what it will allow you to do if you decide to cut it back excessively is to lose your country."
Mr Beazley warned Australia had "dropped the ball, massively dropped the ball", on defence spending for decades.
"You know, when I was defence minister, we were at about 2.5 per cent of GDP and eight to nine per cent of the budget. We're now at 5.5 per cent of the budget and about just two per cent of GDP again, after 25 years."
Mr Beazley's comments will be keenly noticed inside government, with the former Opposition leader considered close to Prime Minister Anthony Albanese as well as fellow West Australian Stephen Smith who is overseeing Labor's Defence Strategic Review.
During his UNSW address, he also warned that Australia and western allies are far too reliant on China for valuable rare earths used in advanced technologies.
Mr Beazley, who served as ambassador to Washington between 2010 and 2016 also suggested rare earths needed to be a focus of the AUKUS partnership claiming Australia had the resources and potential capacity to help break China's stranglehold
"I'm talking about 5-10 years to extract and to process sufficient of those materials to completely replace the dependency that the United States, and for that matter Europe, has on China."
Earlier in the day Japan's ambassador to Australia told the conference his nation was prepared to host Australia's future nuclear submarines and wants to participate in the AUKUS alliance on "specific projects".
"Japan stands ready to discuss with Australia, the US and the UK areas where we can co-operate bilaterally on defence technology," Ambassador Shingo Yamagami said.
