The quiet axing of a controversial Defence associate secretary position on the eve of the budget is being hailed as a victory for uniformed and civilian elements within the Defence leadership group over the minister, Stephen Smith.
A senior analyst with the Australian Strategic Policy Institute, Andrew Davies, said: ''[The decision] would appear to be a triumph for a rearguard action fought on Russell Hill.''
The Canberra Times has been told senior Defence and Defence Materiel Organisation leaders were vigorously opposed to the creation of the ''associate secretary - capability'' position, which had been linked to high-level departures, including that of highly respected capability development chief, Air Marshal John Harvey.
Sources said there had also been strong internal opposition to one of the favoured candidates, a former defence executive now working in a senior role in another department.
Former Defence secretary Ian Watt recommended the establishment of two associate secretary positions, the other for a chief operating officer, in the wake of the Rufus Black review into Defence accountability, which was released last August.
Under the proposed leadership restructure the chief of capability development would have been reporting to the new appointee, rather than directly to the secretary, the Chief of the Defence Force and the chief of the DMO as had been the case. The then deputy secretary - defence support, Simon Lewis, was appointed to the associate secretary - chief operating officer position on February 13. At the time, Mr Smith said: ''The process for finalising the associate secretary - capability position is continuing.
''The [Defence] secretary has advised me he anticipates making an announcement regarding this position in due course.''
That was not to be. Two lines tacked on to the end of a two-page ministerial press release announcing the next stage of the future submarine said: ''As a result of [David] Gould's appointment [as the general manager of submarines] and on advice from the secretary, the previously announced position of associate secretary-capability will not be progressed.''
A spokesman for the minister denied the decision was played down. ''That the position would not be progressed was advised in a major joint press statement by the Prime Minister and the minister,'' he said.
A manager in the DMO has equivalent status to a deputy secretary in Defence, sources said.
Mr Davies, who recommended the substitution of a submarine capability manager for the unpopular - and much more costly - associate secretary position in a paper on the future submarine last November, welcomed the change. ''If I had to choose between the two I would have a manager-submarines any time.''
Australia Defence Association executive director, Neil James, agreed.
He said the creation of yet another level of bureaucracy defied both commonsense and the diarchic principle that underpinned the running of Defence.