During his 20-year career in the army, he was often the victim of dodgy kit.

''When I was deployed to Somalia for instance, I had to spend a lot of my own money to get enough appropriate equipment,'' he said.

''Now the equipment is light years from where it used to be.''

The former army officer said he was thrilled to be offered the chance to enter the ministry.

''Obviously defence and security policy is the great passion of my life and to be able to contribute at a higher level in the security policy area is really something that thrills me and I am very excited about,'' he said.

Dr Kelly reluctantly hung up his full colonel's uniform at the urging of Kevin Rudd, and won the bellwether seat of Eden-Monaro from Liberal Gary Nairn in the 2007 landslide to Labor.

Labor inherited the Seasprite debacle, which cost $1.4 billion for an airframe that delivered not one minute of flying time before the fleet was abandoned.

Dr Kelly is aware his new portfolio is the focus of intense scrutiny over waste, particularly white-elephant projects.

''Having been a user and consumer of defence materiel I'm keenly aware of the importance of getting it right,'' he said.

''My big focus will always be to remember that at the end of that material chance are the men and women of the Australian Defence Force.

''The Australian Defence Force has always got to focus on quality above quantity, that means we're always going to be exploring the technological edge of new capabilities and, of course, that's where all the risk is.

''We went through that with the F-111 and ultimately we had an asset that dominated the region for decades to come.

''We're always going to be in that difficult space where we're looking for the technological edge.

''I think a great deal of progress has been made in the past five years on cost effectiveness, efficiencies, savings - the organisation has been rigorously examining itself and refining and finding those savings.''