US Defense Secretary Peter Hegseth urged Australia to increase military spending to 3.5% of GDP, prompting Prime Minister Anthony Albanese to assert that spending decisions will be based on defense capability needs. Albanese confirmed an ongoing increase in defense spending by approximately 10 billion AUD, aiming for 2.3% of GDP by 2033, despite competing budget demands from natural disasters. The Australian government is also committed to significant investments in US-manufactured nuclear submarines under the AUKUS agreement, which could cost up to 368 billion AUD.
