Defence projects suffer $6.5bn cost blowout as Marles promises more scrutiny in future

Defence projects have blown out by at least $6.5bn placing even greater pressure on the federal budget, the government will reveal on Monday.

Officials said a large share of the budget variations was due to factors such as exchange rates and price indexation, but these still had a real impact on the defence budget.

These new steps include creating an independent projects and portfolio management office within Defence, and regular ministerial summits to discuss remediation plans.

Plans for at least eight nuclear-powered submarines under the Aukus agreement with the US and the UK are yet to be factored into the budget, because key details are part of a review due to be completed by March next year.

Flattening the tax scales is estimated to cost the budget $243bn over 10 years, with the benefits flowing predominantly to higher-income earners.

Chalmers is due to fly to Washington DC this week for a series of talks, including the G20 meeting of finance ministers and central bank governors, before he hands down his first budget on 25 October.