Capability Acquisition and Sustainment Group

The Capability Acquisition and Sustainment Group (CASG) is an organisation within the Australian Department of Defence, responsible for acquisition and supply chain management of military equipment and materiel including aircraft, ships, vehicles, electronic systems, uniforms and rations for the Australian Defence Force. CASG employs more than 7000 military, civilian and contracted staff in more than 70 locations around Australia and internationally.

CASG was established in June 2015 after the Defence Materiel Organisation was disbanded after recommendations from the First Principles Review.

History
The Defence Materiel Organisation was formed in 2000 when the then Defence Acquisition Organisation merged with Support Command Australia, bringing together the Department of Defence's capital acquisition and logistics organisations into a single entity. The DMO was given responsibility for purchasing, through-life support and disposal of military equipment assets, other than facilities and administrative assets.

In July 2005, DMO became a Prescribed Agency under Australian Financial Management and Accountability legislation, meaning that although it remains a part of the Department of Defence, it was separately accountable to the Minister of Defence for its budget and performance.

DMO's stated vision was to become the leading program management and engineering services organisation in Australia. Its goal was to deliver projects and sustainment on time, on budget and to the required capability, safety and quality.

The DMO budget in 2012–13 was A$9 billion, shared between purchasing new equipment and sustainment and through-life support (maintenance, upgrades, fuels, explosive ordnance and spares).

Mortimer review
In May 2008, the Australian Government commissioned a review of Defence procurement, which included in its terms of reference a report on the progress of implementing reforms from the last such review – the 2003 Kinnaird Review.

The review was conducted by David Mortimer, who presented his findings in September 2008. Mortimer identified five principal areas of concern. There was/were:
 * inadequate project management resources in the Capability Development Group,
 * inefficiencies in the processes leading to government approvals for new projects,
 * personnel and skill shortages in the DMO,
 * delays due to industry capacity and capability, and
 * difficulties in the introduction of equipment into full service.

In all, Mortimer made 46 recommendations, with 42 accepted in full by the Government and three accepted in part. One recommendation was not accepted – that the DMO should be separated from the Department of Defence and become an executive agency. This recommendation, which was also made in the 2003 Kinnaird Review, was not implemented by the Howard government. As an executive agency, the DMO would receive its own acquisition funding stream as a government appropriation, and would be headed by a chief executive with "significant private sector and commercial experience". Mortimer also recommended that a general manager Commercial position be created to implement a business-like focus throughout the organisation.

Post-Mortimer reforms
Ministerial statements in 2010 and 2011 suggested that the Government believed new procurement reforms were needed. On 26 November 2010, the Minister for Defence, Stephen Smith, in adding project AIR 5418 Joint Air to Surface Stand-off Missile (JASSM) to the 'Projects of Concern' list, stated that the listing was because of "our poor management, our failure to keep government properly and fully informed about the project and its difficulties." Minister Smith also said that he had asked Defence to review the effectiveness of its management of major projects. On 6 May 2011 Minister Smith announced further Defence procurement reforms aimed at improving project management, minimising risk at project start and identifying problems early and on 29 June 2011, Minister Smith announced reforms to the management of 'Projects of Concern' including the development of formal remediation plans for designated projects.

First Principles Review
On 1 April 2015, the Minister for Defence released the First Principles Review. The review recommended that the Defence Materiel Organisation should be disbanded and the transfer of its core responsibilities in relation to capability delivery to a new Capability Acquisition and Sustainment Group, which took effect from 1 July 2015.

Structure

 * Joint Systems Division
 * Maritime Systems Division
 * Submarines Division
 * Future Submarine Program
 * Ships Division
 * Land Systems Division
 * Helicopter Systems Division
 * Aerospace Systems Division
 * Joint Strike Fighter Program
 * Commercial Division
 * Program Performance Division

Leadership
Dr Stephen Gumley was the DMO's chief executive officer from February 2004 until his retirement was announced by the Minister for Defence, Stephen Smith, on 7 July 2011. Gumley had headed an executive team of around 20 senior managers. According to the DMO website, the executive team has considerable private and public sector experience, as well as extensive military domain knowledge.

In March 2009, the Corporate general manager of the DMO, Jane Wolfe, was dismissed for unsatisfactory performance. The Canberra Times reported that its 'senior public service sources' believe she is the highest-ranking Australian Commonwealth public servant to ever have been dismissed for underperformance. Wolfe was reinstated in April 2010 following a legal challenge against procedural aspects of her dismissal in the Federal Court of Australia. The case is said to have "significant implications" for the Senior Executive Service of the Australian Public Service, where legal challenges to performance decisions have been rare.

On 13 February 2012, Warren King (former Deputy CEO) was appointed CEO.