Almost four years on from the launch of the trilateral AUKUS pact, the partners’ Pillar II advanced capabilities effort remains a solution in search of a problem.
Led by lofty shared ambitions in a host of technological areas, rather than by clearly specified and carefully selected strategic needs, the AUKUS countries have put the cart before the horse, with little to show for it. But, in words usually attributed to Winston Churchill: “Success is not final, failure is not fatal: it is the courage to continue that counts.”
In 2021, Australia, the United Kingdom, and the United States announced an unprecedented trilateral partnership on a generational nuclear-powered submarine capability. This first AUKUS announcement was followed up in 2023 by the release of a Pillar I Optimal Pathway — a detailed strategic plan to 2053 to deliver a fleet of nuclear-powered, conventionally armed submarines to Australia and the United Kingdom.
The addendum to this undertaking was the far less headline-grabbing but seemingly more immediate Pillar II — a trilateral advanced technologies program. From the outset, Pillar II seemed the “ugly stepsister” to the submarine program. In the intervening years, this still rings true.
With a clear capability end-state in mind, progress on AUKUS Pillar I has been steady. It has sparked a reconfiguration of bureaucracies, regulations, and defense funding to varying degrees by the three countries. By contrast, Pillar II has lacked clarity of purpose and has consequently been exceptionally slow to command official focus, resources, and the relative attention of commentators.
Pillar II’s early promise was quick wins — distinct from the long horizon of the submarine project — but it seems the goal posts have been moved. Now, the 2027 rotational deployments of U.K. and U.S. submarines to Australia may be the earliest major deliverable of the AUKUS pact, six years into its life. Why? Because Pillar II is, at present, failing in its mission.
Over the last four years, commentators have described Pillar II as “revolutionary” with the potential to produce capabilities “more consequential” than Pillar I submarines for the AUKUS partners. The Australian Strategic Policy Institute’s Critical Tech Tracker highlights China’s growing advantages in innovation. China now leads in 57 of 64 global technology priority areas, including advanced undersea wireless communication and adversarial AI. Accordingly, each of the AUKUS countries is seeking to expand their strengths and close gaps in areas where they are falling behind. Under the auspices of Pillar II, AUKUS countries have made incremental achievements: hosting an AI and autonomy trial; fielding a trilateral algorithm for improved anti-submarine warfare information sharing among P-8 Poseidon maritime patrol and reconnaissance aircraft; and conducting joint testing of autonomous robotic vehicles and sensors.
Still, experts have rightly observed that Pillar II has a public relations problem. The project lacks marquee deliverables with a so-called AUKUS sticker that would provide urgently needed proof of concept. The matter at hand — sophisticated, trilaterally supported innovation — seems to be unfurling lethargically. Instead, the unglamorous work of dusting the cobwebs off of decades-old U.S. regulatory regimes and upgrading legislation in Australia and the United Kingdom to ease technology and industrial partnership is being touted as major progress. While this policy reform is essential, the fact remains that it does not itself deliver capability into the hands of warfighters.
It may be that serious work is proceeding behind closed doors. Due to the classification of the technologies involved, progress now and the future will, by necessity, be obscured from public view. But few, within or outside of government, would argue that Pillar II has delivered on its early promises.
How did we get here? And, more importantly, where to next for Pillar II? Following elections in all three countries, no national leader remains in the halls of Washington, Canberra, or London who conceived of AUKUS in the first instance. With all three governments focused on defense-industrial uplift and optimizing defense spending, there is a clear window of opportunity to resuscitate Pillar II.
How Did We Get Here?
Realities of bureaucracy, resourcing, ambition, and scale have coalesced to make the implementation of Pillar II daunting. From the outset, Pillar II suffered from vagary. The four priority areas — advanced cyber, AI and autonomy, quantum technologies, and additional undersea capabilities — then expanded to eight in 2022 (with the addition of hypersonic and counter-hypersonic capabilities, electronic warfare, innovation, and information sharing), representing an immense agenda. The selection of these areas may have been approaching the project backwards — starting with technologies in mind rather than from the challenges that collaborative innovation could solve. The competing overriding foci of each AUKUS country seems to have made prioritization within the current framework challenging. With manifold objectives and little dedicated funding, senior officials have been unable to effectively drive Pillar II to delivery.
Where Pillar I has prompted the reorganization of bureaucracies — most noticeably in Australia’s formation of a new Australian Submarine Agency with more than 550 employees — Pillar II lacks organizational heft. As one example, in the United Kingdom, the Ministry of Defence’s Pillar II team has been entirely restaffed. The institutional knowledge of the program and of industry that could sustain Pillar II is slow to develop and time-intensive to restore as government officials rotate. Trilateral coordination of new project leads and structures remains an evolving challenge.
Similarly, Pillar II lacks dedicated funding lines at any phase along the pathway of technology development. Initial optimism from defense-industrial prime manufacturers, subject matter experts, and universities that AUKUS Pillar II would open new funding lines was slowly stymied. AUKUS funding is now buried within existing programs of record, but it took three years to reach this decision. Planning for an ecosystem to support pillar funding and future translation of basic research into capability is nascent and uncoordinated. Nor is AUKUS-specific funding available from any of the three national defense departments for near-term Pillar II capabilities outside of the recent innovation challenge. As a result, there is little clarity as to where lines of investment will flow.
Against this backdrop, the three AUKUS countries’ decision to invite other partners into Pillar II projects rings premature. The inclusion of Japan, Korea, Canada, and New Zealand may prove beneficial in the long term. Integrating industrial bases for key capabilities with trusted partners is a worthy ambition. However, recognizing the challenges of even trilateral collaborative innovation and ongoing concerns about security classification, the expansion of Pillar II seems more a legacy-defining effort in the dying minutes of the Biden administration than a demonstration of success.
On the whole, the impression is that AUKUS Pillar II is getting overshadowed, if not crowded out, by the national research and development agendas of AUKUS countries. AUKUS has not proven to be an organizing principle for the Department of Defense or Whitehall’s research and innovation system.
Has Pillar II’s Moment Arrived?
Though Pillar II may have languished to date, its logic remains. Several factors are coalescing in each AUKUS country to make Pillar II both more attractive and more feasible than ever before. All three AUKUS countries have national priorities for reindustrialization and the development of modern manufacturing capabilities. Advanced technology and national strategic advantages in research and innovation lie at the center of all these policies. Far from abandoning the initiative, it is essential for the three governments to reconsolidate their efforts behind those Pillar II lines of effort holding the most promise.
In the United States, hard-won reforms to export controls are now being tested. The Trump administration and Congress are voicing unprecedented willingness to preside over transformative changes to U.S. acquisition and procurement policy. In an otherwise unpredictable Trump administration, perceptions of allies and partners as force multipliers and the criticality of greater U.S. defense-industrial resilience have endured as throughlines from the Biden administration. Though the impression is not unmitigatedly positive, with cuts foreshadowed to the larger defense innovation budget, in many respects AUKUS Pillar II seems on a positive footing in Washington.
With 30 reviews of foreign or national security policies initiated by the Starmer government, the United Kingdom is also at an inflection point to reinforce its commitment to AUKUS Pillar II. In 2025, new ambitious spending commitments have been announced, including an increase in topline defense spending to 2.5 percent of gross domestic product by 2027. AUKUS was ringfenced in the terms of reference for the imminent Strategic Defence Review as one of very few protected initiatives. The Lovegrove Review and a forthcoming parliamentary inquiry will keep AUKUS front of mind for both parliamentarians and bureaucrats, socializing a new cohort of Members of Parliament into the initiative and providing ample opportunity to correct course.
At a recent event in London for AUKUS, British Prime Minister Sir Keir Starmer affirmed his personal commitment to AUKUS cooperation. At the same event, new U.S. ambassador to the United Kingdom Warren Stephens — the billionaire private banker, major Republican donor, and friend of President Donald Trump — called AUKUS “vital” to global peace, security, and prosperity. For the United Kingdom, AUKUS is considered a model for future technology collaboration with other partners. To that end, priming Pillar II for success is only growing more urgent.
AUKUS Pillar II fits squarely within the signature national uplift policy of the Australian Albanese government: Future Made in Australia. Technology and industrialization are focal points of its agenda. Within the Department of Defence, the 2023 Defence Strategic Review and 2024 National Defence Strategy honed both focus and investment on AUKUS. Pillar II is linked to the asymmetric capability objectives for Australia’s Integrated Force. The Advanced Strategic Capabilities Accelerator has struggled to make progress over the past two years. However, its shift to oversight under the Vice Chief of Defence Force Group and the replacement of its civilian scientist lead with a two-star military officer signal a much-needed recalibration. With the continuity of focus guaranteed after the Albanese government’s landslide election victory and reappointment of relevant ministers, the Australian government is perfectly positioned to reform and revitalize Pillar II.
What Is the “Optimal Pathway” for Pillar II?
AUKUS Pillar II requires political intervention built around focused political will, governance, resourcing, and prioritization.
Only coordinated action from all three national governments will deliver the political capital needed to energize the flagging Pillar II initiative. Such a move requires not only direction but focused attention and oversight. The “eye of Sauron” emanating out of defense ministerial offices in all three countries should remain firmly affixed on AUKUS Pillar II. In Australia and the United Kingdom structures for national cabinet-level coordination should be put in place, not only for defense funding but, most significantly, for the coordination and prioritization of AUKUS related basic research funding across government for universities and industry. In these countries, key staff should be put in place with dedicated roles for ministerial and whole-of-government level oversight to assure focused attention and coordination.
AUKUS demands a governance structure commensurate to its significance to the three countries’ strategies. The appointment of Stephen Lovegrove as the prime minister’s Special Representative for AUKUS in the United Kingdom is the latest effort to provide greater central direction to the project. It is critical that there are requisite direct counterparts in each AUKUS country, noting Australia presently has no analogue official and the U.S. AUKUS Senior Advisor post in the Department of Defense remains vacant. This should be rectified immediately.
After a halting start, it’s now clear that a shared pot of money for AUKUS Pillar II financing is necessary to underwrite future projects. As former Australian Secretary of Defence Sir Arthur Tange noted, “strategy without funding is not strategy.” In the absence of dedicated funding, AUKUS Pillar II will be nothing more than a good idea. To demonstrate intention and communicate certainty to prospective industry and university participants, an AUKUS fund should be established. Contributing countries should share in the resulting intellectual property and work collectively to attract private capital interest.
Beyond this fund, AUKUS priority areas should be embedded across the research support landscape. Basic research is an essential piece of the Pillar II puzzle that should not be neglected, even as focus is trained on research at a higher technological readiness level. For the basic research funding programs across government, preferential consideration should be given to projects with AUKUS collaborators, to better render such configurations business as usual for academics and industry across domains. Funding arrangements for early-phase research would also provide an achievable on-ramp for aspiring AUKUS countries Japan, South Korea, Canada, and New Zealand, provided that these projects evade overclassification in their preliminary stages.
One implicit priority that should be elevated is the collaborative funding of basic and applied research by all participating countries, including Japan, Korea, New Zealand, and Canada. This commitment should be distinct from the nearer-to-service capability programs being pursued at a higher level of technological readiness for the United States, United Kingdom, and Australia.
Equally, it’s evident that AUKUS countries cannot advance all eight Pillar II priority areas in one breath. To streamline political energy, funding, and academic activities, the AUKUS partners should reduce their priority areas. Enduring lines of effort should be centrally directed by around shared defense capability challenges. Though these may emerge from the current eight priority areas, this should not be essential. The tail should not be wagging the dog.
The three original AUKUS countries should be focused on the delivery of near-term capability programs built around equitable attention to funding and speed. Delivering one to three marquee programs oriented around shared force structure concerns should be the overriding goal. Rather than starting from the ground up, technologies on the cusp of becoming programs of record should be prioritized to accelerate their delivery into service, with a complementary focus on their spiral development once deployed. This will require the three countries to reconcile different visions of the best near-term viable products to reconsolidate behind a smaller set of near-term priorities.
Conclusion
The strategic imperatives that drove the United States, United Kingdom, and Australia to form AUKUS have only intensified in the intervening years since its announcement. Pillar I submarine cooperation remains more or less on track, thanks to generous funding, exacting political oversight, and prioritization of the submarine industrial bases in all three countries.
Pillar II needs the same treatment. The enabling factors, from political will to defense trade legislation, are now in place for Pillar II to deliver upon long-anticipated promises.
However, if this moment is not seized, this trilateral effort will remain the ugly stepsister of the program. It will wither politically, and it will thus fade into irrelevance. If this opportunity continues to be squandered, each country will be giving away its greatest prospective asymmetric advantage in an intensifying global defense technology race. The time to invigorate AUKUS Pillar II is now.
Peter J. Dean is a professor and the director of foreign policy and defense at the United States Studies Centre at the University of Sydney. He was co-lead of Australia’s 2023 Defence Strategic Review Secretariate where he served as senior advisor and principal author for the Independent Leads.
Alice Nason is a Fulbright Scholar and non-resident fellow of the United States Studies Centre at the University of Sydney.
Image: Petty Officer 1st Class Justin Yarborough via DVIDS.
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