First Principles Review Recommendation 2 called for Defence to ‘Establish a single end-to-end capability development function within the Department to maximise the efficient, effective and professional delivery of military capability’. The Capability Life Cycle is Defence’s response to this recommendation.

The Capability Life Cycle delivers the Government’s capability aspirations outlined in the 2016 Defence White Paper and the accompanying Integrated Investment Program. It has been operating since April 2016.

The Capability Life Cycle provides Defence with an end-to-end process for capability development and delivery of capital projects, and associated through-life support, related to major capital equipment, infrastructure, enterprise enablers and ICT.

The Capability Life Cycle has clarified roles, strengthened accountabilities, improved central agencies engagement and established strong Force Design and Contestability functions that are central to improved decision-making. The Capability Life Cycle introduced tailored investment approval pathways guided by the Smart Buyer decision-making framework, along with an ongoing Force Design process which is being further improved by incorporating process lessons from the 2020 Force Structure Plan. Together these enable the Integrated Investment Program to be agile and responsive to Defence and Government priorities.

As part of Defence’s commitment to ongoing reform, in 2019–20 we conducted a review of the capability program architecture established in the 2016 Defence White Paper and Integrated Investment Program. This resulted in a new capability program architecture, based on five domains, 35 programs and a number of multi-domain programs, which was agreed by Government in January 2020. The new capability program architecture has clearer responsibilities and accountabilities and provides Capability Managers with greater ability to manage risk and drive improvements in effectiveness and efficiency.

Overall, the implementation of the Capability Life Cycle is enabling Defence to deliver on the recapitalisation of Australia’s defence capability outlined originally in the 2016 Defence White Paper and now in the 2020 Defence Strategic Update and associated 2020 Force Structure Plan. This is evidenced by the significant number of capability investment approvals achieved since its introduction in 2016.