The program, which has been operating for more than 20 years and is regarded as Defence's most successful international co-operation project, supplies 22 patrol boats and stations navy personnel across Pacific island states to prevent illegal fishing and smuggling and to secure the islands' waters, which usually cover a greater area than their land mass.

But a Defence submission to a Senate inquiry into the South Pacific says rising fuel costs and a lack of assistance from partner states have made the program too expensive to sustain. It says the Government should consider cancelling the program or phasing it out from 2017 as the boats expire.

"The entire Pacific patrol boat [PPB] program remains under pressure …" the submission says. "Although the PPB program is a major Defence contribution to the region's maritime and economic security … Defence does not intend to recommend a Defence-led follow-on PPB program in the options taken forward to Government."

The program has been credited with protecting economies in the Pacific, boosting closer defence and diplomatic ties and promoting self-reliance. It was renewed in 2000 by the Howard government, which described it as "a powerful symbol of Australia's strategic partnership with the South Pacific region".

The Defence submission says patrolling the Pacific waters is vital to protecting economies and security in the region because most states are unable to enforce their own borders.

"Regional instability, civil unrest, humanitarian emergencies and natural disasters are potential challenges for Australia," says the submission, which was cleared by the Minister for Defence, Joel Fitzgibbon.

Anthony Bergin, the director of research programs at the Australian Strategic Policy Institute, said the patrol boats had bolstered maritime security and the Government should try to set up a broader program involving the co-operation of the islands and other countries with an interest in the Pacific, including the US, China, Japan and France.

"Maritime security threats in the South Pacific have direct follow-on effects for Australia," Dr Bergin said. "It is not just about fish. It is about a whole gamut of security issues such as arms-smuggling, drug smuggling, illegal fishing and human trafficking."

France's Defence Minister, Herve Morin, signalled a move to enable greater co-operation with Australia in the Pacific, saying France was setting up a major naval base in New Caledonia and would provide access to Australia.

The submission says the Pacific states have struggled to crew and maintain the boats and have achieved only 36 sea days a year per boat, down from an expected 50 days. Rising fuel and maintenance costs have forced the Government to spend $51.5 million on the program in the past two years despite an expected annual cost of $12 million.