The Australian government will seek to prop up the Aukus pact by sending A$4.6bn (£2.4bn) to the UK to clear bottlenecks at the Rolls-Royce nuclear reactor production line.
The funding – revealed on the eve of high-level talks between the Australian and UK governments on Friday – is in addition to billions of dollars that will be sent to the US to smooth over production delays there.
The Australian government will also announce on Friday that the government-owned shipbuilder ASC and the British defence firm BAE Systems will jointly build the nuclear-powered submarines for the Royal Australian Navy.
The nuclear reactors for the boats are to be manufactured at Rolls-Royce in the English city of Derby, but doubts have already been raised about whether reactor cores will be made in time for the UK’s first Dreadnought nuclear submarine.
Australia has now allocated £2.4bn over 10 years to expand the production capacity at Derby to deliver reactors for Australia’s submarines, to be known as SSN-Aukus.
The funding is also believed to include Australia’s contribution towards the costs of designing the new submarine. It is understood the previously unpublished figure comes from within the existing Aukus funding envelope.
Australian government sources argued the funding was “an appropriate and proportionate contribution to expand production and accommodate Australia’s requirements”.
They argued the government would spend “far more” in Australia, including $8bn over 10 years for infrastructure upgrades at the HMAS Stirling naval base in Western Australia.
The base is set to host increased rotational visits by UK and US submarines from 2027.
The UK’s foreign secretary, David Cameron, has sought to reassure Australian politicians about delays in Britain.
“We know where we’re going to build them,” Cameron told the ABC on Thursday night. “We know what we’re going to build. We know how much it’s going to cost. We are absolutely committed to doing it.”
Cameron and the UK defence secretary, Grant Shapps, arrived in Canberra on Thursday for talks with their Australian counterparts, Penny Wong and Richard Marles.
They will hold an annual 2+2 meeting in Adelaide on Friday, with Aukus expected to be a major focus along with the war in Ukraine, the conflict in the Middle East and China’s position in the Indo-Pacific.
Shapps acknowledged on Thursday it was “fair” to raise concerns about past delays, but argued the UK was “recapitalising on submarine production in a very big way”.
“I think in the future, we have this as a national endeavour that is important for us to deliver,” Shapps told reporters in Canberra.
“Working with partners is a great way to also help you get the pressure from all sides to get it done.”
Marles, the deputy prime minister and defence minister, said at the same media conference that the Australian government was “really aware of the stretched industrial base in the UK and in the US”.
Australia’s commitment to help clear backlogs in the US and the UK “was not without controversy” but was necessary for Aukus to succeed, Marles said.
Under the staged plans announced last March, Australia will buy at least three Virginia-class submarines from the US in the 2030s, prior to the domestically built SSN-Aukus entering into service from the 2040s.
But revelations that the US Navy plans to build only one Virginia-class nuclear-powered submarine next year have prompted renewed concerns about lagging performance on US production lines.
Marles, Shapps and the US defence secretary, Lloyd Austin, issued a joint statement on Thursday declaring the three countries remained “fully committed to this shared endeavour” and were “investing significantly” to ensure its success.
Australia plans to set up a joint venture between ASC and BAE Systems to build the SSN-Aukus submarines. This structure will allow the Australian government to be heavily involved in delivering the strategically important project.
But the finer details have yet to be locked in, and ASC and BAE will work cooperatively in the meantime to develop the new submarine construction yard at South Australia’s Osborne shipbuilding precinct.
ASC built Australia’s conventionally powered Collins-class submarines, but has not previously worked with nuclear-powered boats.
In 2014 the then defence minister, David Johnston, was censured by the Senate for saying he “wouldn’t trust them [ASC] to build a canoe”.
The Australian government argues ASC has “an unrivalled knowledge of Australian submarine operating conditions, and an existing, highly skilled workforce and sovereign supply chain”.
It says the joint venture will enable BAE to contribute “critical knowhow, intellectual property and over 60 years of nuclear-powered submarine building experience”.
Meanwhile, the government will give ASC responsibility for sustaining Australia’s nuclear-powered submarines.
About 100 ASC workers are expected to travel to the US navy’s maintenance facility in Pearl Harbor next year as part of the training process.
The US ambassador to Australia, Caroline Kennedy, said Aukus was “a gamechanger for regional security” and would see “unprecedented information-sharing” on advanced defence technologies.
Australia and the UK on Thursday also signed a new defence and security cooperation agreement that formalises a commitment to consult each other on threats to sovereignty and regional security.
It includes a status of forces agreement, clearing regulatory hurdles for their forces to operate in each other’s countries.
