Aukus costs balloon with more cash and staff for submarine agency amid ongoing search for nuclear waste dump

The budget for Australia’s contentious Aukus deal has ballooned by more than $430m over four years, with the agency charged with securing the country’s nuclear-powered submarines requiring a massive injection of funding and staffing.

The Australian Submarine Agency’s resourcing for next financial year will jump by a third – from $385m to $512m.

Staffing at the ASA is also set to jump, from about 883 positions to 1,209 next year, an increase of 37%.

The 2025-26 budget papers forecast the agency having total resourcing of $1.7bn for the four years to 2028-29. This year’s budget has expanded that forecast to more than $2.13bn for the same time period, an increase of $431m.Sign up for the Breaking News Australia email

In the previous budget, ASA’s total annual budget peaked at $529m in 2026-27. It will now peak at $641m, two years later in 2028-29.

Aukus is the trilateral deal signed by the Morrison government with the United States and United Kingdom, the so-called “Pillar One” which promises to deliver Australia its own fleet of conventionally armed nuclear-powered submarines. The budget papers say the Aukus agreement is a “prudent response to deteriorating strategic circumstances”.

“Aukus partners have a shared commitment to the partnership and its importance in promoting a free and open Indo-Pacific through an enhanced collective capacity to deter aggression and contribute to stability, peace, and prosperity in the region.”

The budget says for a maritime nation such as Australia, a submarine capability is critical for the nation’s defence and for “working with our partners”.

“The stealth, range, speed and endurance of these submarines is unmatched, and will ensure we have a potent submarine capability for decades to come.”

The 2026-27 budget also addresses another outstanding Aukus issue, that of nuclear waste management over millennia.

Australia has not identified a permanent storage site for the nuclear waste generated by its nuclear-powered submarine fleet, including the high-level radioactive waste from the reactor core and spent fuel, which will remain toxic for thousands of years.

Successive federal governments have spent three decades unsuccessfully trying to establish a nuclear waste site. In 2023, the defence minister, Richard Marles, committed to publicly outlining a process for identifying a waste site “within 12 months”. No plan, or site, has yet been identified. Marles has said a site will be identified on defence land, current or future.

The 2026-27 budget earmarks $11.9m over two years for the Australian Radioactive Waste Agency to assist “in developing advice to inform Australia’s future radioactive waste management and disposal pathways”.

Industry experts and defence analysts have raised concern that Australia’s sovereign submarine fleet may never arrive in Australia.

The government’s “optimal pathway” for Aukus has the US selling Australia three Virginia class submarines – two secondhand and one new – beginning in the early 2030s.

But, given stubbornly sclerotic rates of submarine building in the US, the Congressional Research Office has openly considered that, instead of the US selling any Virginia-class submarines to Australia, it would rotate its own US-commanded vessels through Australian ports.

For the past 15 years, US shipyards have built submarines at a rate of between 1.1 and 1.2 boats a year. The US fleet currently has only three-quarters of the submarines it needs, and would need to double its current build-rate to supply any boats to Australia at all.

But the backbone of Australia’s proposed nuclear-powered fleet is dependent upon the UK designing and delivering the first of a new class of conventionally armed, nuclear-powered submarine: the SSN Aukus.

The Royal Navy’s first Aukus submarine is slated to be complete in the “late 2030s”. Australia will build its first Aukus submarine, based on the UK design, in Adelaide.

That boat – the first of five to be built domestically – is scheduled to be in the water in the early 2040s.

But the UK’s shipbuilding industry is even more moribund, hollowed out by decades of underinvestment and neglect.

At the outbreak of the current US-Israel war with Iran, the UK had only one of its six-strong fleet of attack submarines at sea. The HMS Anson, visiting Australia, was hurriedly recalled to the northern hemisphere.

The UK must also prioritise – before it builds the first Aukus – building one further Astute class attack submarine, and four Dreadnought class nuclear ballistic submarines at its sole submarine-building yard, at Barrow-in-Furness.

Into the 2050s, Aukus is estimated to cost Australia $368bn, including about $4.6bn to be given to each of the UK and US to boost their submarine-building rates.