AUSTRALIA: 'Battlefield Business'

 MARK COLVIN: War today isn't just about privates; it's also about privatisation.

The use of private contractors on the battlefield has been a distinctive element of the invasion and occupation of Iraq.

And today the Australian Government's defence think-tank weighed in with a study that says it's time to create a legal regime covering the use of "business on the battlefield".

Graeme Dobell reports from Canberra.

GRAEME DOBELL: Call it the "Coalition of the Billing". There's bucks to be made on the battlefield.

When the United States fought the first Gulf War in 1991, it deployed one contractor for every 100 uniformed personnel. By the time of the Iraq War, the ratio was one contractor for every 10 troops.

The Australian Strategic Policy Institute says that's the way of the future and Australia needs to create a legal regime to cover the use of the private sector to support overseas operations, similar to the export control regime for the sale of military technology.

The report got a cool response from the Defence Minister, Robert Hill, who says Australia has been more conservative than Britain or the United States in putting business on the battlefield.

ROBERT HILL: Two tests we apply are operational effectiveness and cost effectiveness and we've been applying those tests for a long time and it has led to the outsourcing of many services, but not... but not on the battlefield.

GRAEME DOBELL: The Strategic Policy Institute though, says it's merely describing a clear trend in the Australian Defence Force over the past 15 years, as the number in uniform has fallen from 70,000 to 52,000.

The numbers have been cut by permanently outsourcing much of the rear echelon support tasks, and the ADF has used contractors in East Timor, Bougainville and Solomon Islands, as well as in Afghanistan and Iraq.

The report author, Mark Thomson.

MARK THOMSON: The ADF needs to retain some organic capability for high intensity operations when contractors would be inappropriate, but in other circumstances they should be making as much use of contractors as they can to not only deliver capability more cost effectively, but to stretch their capability to meet the demands of current operational tempo.

GRAEME DOBELL: So perhaps not the dogs of war but the lawyers of war or the cooks of war.

MARK THOMSON: Yes. There's a range of different capabilities. If we look at the Solomon Islands for example at the moment, the contract there which is supporting the AFP in their operation, replaced the ADF.

What we have on the ground there is contractors providing fixed-wing aircraft, three helicopters that do search and rescue, rapid response, aero-medical evacuation. They have two boats. They have 250 personnel, and a rather well equipped hospital.

GRAEME DOBELL: What lessons should Australia take from the way the United States has been using contractors like Halliburton in the Middle East?

MARK THOMSON: I think there's really two main lessons.

One is: they need to make sure they've got the capability to manage contractors. These are not something that you just set in train and forget about. You've got to have well written contracts and constant vigilant oversight to make sure that you're getting what you want from the contractors.

Second, I think we need to look at the regulation of some of these firms. In particular, where you're looking at firms who provide security services in operational environments, we need to, just as the US already has and the UK is investigating, we need to begin looking at how we're going to regulate these firms.

GRAEME DOBELL: Where do you draw the line though? How do you actually define what is the traditional role of the armed forces and where do you say, "No, I can put that out to tender".

MARK THOMSON: I think the way to answer that is to look at where the boundary is, where the difficulty is. And the difficulty is when you're getting the private sector to provide security services for you, as for example in Iraq at the moment. There's, depending on estimates, anywhere between 10 to 20,000 private contractors providing security services there on the ground.

The way to draw the boundary there is simply to look at international law. If you've got a circumstance where the use of private contractors may mean that those individuals are seen as non-privileged combatants under international law, well, once you've reached that point you've crossed the line, made the mistake.

MARK COLVIN: Mark Thomson of the Australian Strategic Policy Institute with Graeme Dobell.

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