Chief of Army Major General Rhys Jones; Massey University Vice-Chancellor Hon Steve Maharey; Service Chiefs; fellow speakers; members of the ABCA Delegation; members of the Defence Attaché Corps; senior members of Ministries of Defence, Foreign Affairs and Trade, New Zealand Customs Service and Police; ladies and gentlemen.

The concept of "Enduring Conflict" is the background to the Defence Review. The past 15 years has seen the continuous deployment of the New Zealand Defence Force. These have included combat operations, as with the SAS in Afghanistan and elements of the early deployment to Timor-Leste. They have also involved stabilisation operations, shipping interdiction and patrol and intelligence gathering. All three services have been actively involved.

The effect is that contemporary service people can expect to be deployed on overseas operations. It has become the expectation of our Defence Force. This is no surprise given New Zealand's geographic place in the world. For over 100 years, New Zealand servicemen and women have fought far from home. Whilst ships were sunk near New Zealand, the country was not threatened with direct invasion even during the two World Wars.

A Defence Force for which overseas operations become the norm has significantly different demands on it, than a Defence Force that is unlikely to be deployed. More care has to be given to the nature of training, the type of equipment acquired, and strategic assessments that are made.

I will therefore deal with the broader strategic picture that underpins the Defence Review. These include the relationships that New Zealand has with its closest partner Australia, especially in the Asia-Pacific region.  However, New Zealand is not just confined to the Asia-Pacific region. We also have wider interests.

I will also deal with the effect that the conflicts of the past decade have had on the operational capabilities of the New Zealand Defence Force.

The ANZAC partnership is our most fundamental defence and security commitment. It is not just history that brings us together. Our politics are similar. Our people are similar. This means that our view of the world is similar. We are both trading nations that rely on export income as the basis of our economies. When our two nations look around the region, it is apparent to each of us that there is a very strong commonality of interest between Australia and New Zealand.

This common interest extends to our desire for the maintenance of stability in the Asia-Pacific region. The likelihood is that the 21st century will be the Asian century, at least in terms of economic prowess.

As part of that wider region, both our countries are well placed to benefit from the trade and development that will flow. As you would expect, both countries are actively involved in regional issues and recognise that we have a responsibility to be engaged in defence and other relationships.

That does not mean that our interests are identical. For example, Australia and New Zealand have somewhat different defence contexts. Australia's size, location and status as a "middle power" in the region have led it to develop and maintain capabilities that are beyond the scope of New Zealand.

This disparity in our size also means that New Zealand has to think carefully how to make the best and most useful contribution to the ANZAC partnership. Although in personnel terms New Zealand's defence force is one-fifth the size of Australia's, there are many areas where we add a much greater value to the ANZAC partnership than the size differential suggests.

For example, during a recent visit to the Royal Australian Navy base at Garden Island in Sydney, the importance of our naval logistic capability was emphasised. The Endeavour represents one-third of the naval replenishment capability across the two navies. As you all know, across the range of regional deployments, the New Zealand Army frequently contributes rather more than one-fifth of the frontline personnel.

The Australian White Paper released earlier this year also recognised this. It noted that " . . . we must also plan together on the basis that our combined operations in pursuit of our common security interests, as have occurred over recent years, are the new norm". It went on to suggest that the two countries should look for opportunities to further work together and integrate force elements "in the ANZAC tradition". Defence relations between the two countries are in excellent shape.

The two Prime Ministers are committed to further building the ANZAC partnership. Last month they announced that the two countries would investigate an ANZAC defence contingent which could be deployed at short notice.

This provides a real impetus to our own Defence Review. We will need to carefully examine how we can step up the ANZAC defence relationship.  There are many forms that a joint contingent could take that do not prejudice our ultimate national autonomy. Alongside this could go the deepening of specialist capabilities that each of us has so as to avoid duplication, and further efforts in defence industry co-operation.

This close relationship has particular relevance in the Pacific region. This is a region where Australia and New Zealand will be taking the lead - a concept for which Professor Hugh White has coined the phrase "together alone". If we do not have the will and the means to act, then we cannot expect that anyone else will do it for us.

The situation a decade ago in Timor-Leste brought this home with great clarity. We could not wait for wider global forums to take the lead. The situation demanded that we act swiftly and in concert.

This has been played out on several occasions in the Pacific since then. In an operational sense, we have demonstrated effective integration of our defence forces.  New Zealand has been a significant partner and sometimes the leader in these operations. The result has been a far deeper appreciation between both our countries of what each of us can do and the benefits of working closely together.

Beyond the Pacific, the Asian region has become a far greater focus of attention. As the Asian economies have grown, they have become more outward-looking. There is a desire from Asian countries and an expectation from other nations that they will play a bigger role in contributing to the wider global responsibilities that nations share. This in turn influences relationships within the region and the development of defence policy. 

New Zealand is vitally interested in this changing dynamic. We are optimistic that relationships across the region will continue to develop in a positive way. There is no reason to think otherwise.  We also realise that we have to play a real role in ongoing confidence and security-building.

This requires that we participate not just with words, but with deeds. We have to make a contribution in defence terms that has value and is noticed.

This is something that we have been able to do through capabilities that we already have. New Zealand is a frequent participant in FPDA exercises and in defence-related activities throughout the region. Our "blue water" naval capabilities and the value of surveillance assets such as the Orions are noted and appreciated. New Zealand is one of the smallest countries with capabilities of this sophistication and reach. Our challenge is to maintain and build on these capabilities.

New Zealand's defence responsibilities do not end with our region.  Our history and our values drive us to a level of international engagement that is unusual for a country of our population size.

We do not really have a choice in this. Terrorism is not something that happens to other people. The fact is that seven New Zealanders' lives have been lost in terrorist attacks since September 11. Historically New Zealanders have not stood by while their countrymen's lives and well-being have been threatened and attacked, and we should not do so now.

This takes considerable effort. Yet we also go to great effort and expense to protect New Zealanders from other infrequent, but potentially high cost, risks such as earthquakes, tsunamis, landslides and pandemics.

In the end we have to ask ourselves: should we leave others to respond to international risks that affect New Zealand?

New Zealanders are not free-riders. That is why we are in Afghanistan. That is why we have taken on responsibilities beyond our size when it comes to peacekeeping. We are prepared to work with like-minded countries to improve security where we can.

New Zealand has just reviewed its commitment to Afghanistan. We are deploying the SAS. The work of our Provincial Reconstruction Team in Bamiyan Province will be more focused on developing and building the local governance and security capability. We will continue to monitor progress.

The events of the past decade will inevitably shape the capability requirements of the NZDF. Of course it would be imprudent to just use specific conflicts as the only guide to capability. Rather, they inform the requirements. The NZDF does have to have enough flexibility to cover a wide range of contingencies, whether they involve combat operations, peacekeeping operations or humanitarian operations such as was recently required in Tonga.

What capabilities do we need? The basic test for a Defence Force as small as New Zealand's is that it should essentially consist of those capabilities that are likely to be used, whether for peacekeeping or for combat, rather than capabilities that are unlikely to be used except in the most extreme cases.

It follows then, that New Zealand's ability to contribute to global coalition operations comes as a "spin-off" from the essential capabilities we need to maintain closer to home.

We will be ensuring that whatever demands are made on our forces they will be well-trained and interoperable with our likely partners - particularly our ANZAC partner, Australia.

The essence of the capabilities can be seen this way. In our region, that is, out to Timor-Leste, we have to have the full range of capabilities for any reasonably foreseeable defence task. We don't envisage shooting down enemy aircraft or sinking submarines, but pretty much everything less than that has to be dealt with.

It is clear already that there are limitations in the ANZAC capability. Tonga was an example of this. Both Australia and New Zealand deployed dive teams of a similar size and capability. Neither of us could operate effectively deeper than about 55 metres. It raises the issue of what complementary capabilities we should focus on.

Diving is an occasional requirement. By contrast, fisheries and maritime surveillance is a role that is vital to the small Pacific states, but generally beyond their own capabilities. There is considerable potential for New Zealand and Australia to work together to raise the standard and presence of surveillance in the region. Both countries could focus on developing specific capabilities that when combined provide a utility greater than the individual components. This approach could also extend to other areas, such as logistic and medical support.

Most military operations require soldiers on the ground. That is why the Army has twice as many people as the other two services. The professionalism of our soldiers has been tested continuously over the past decade with ongoing deployments throughout the region.

While the capital costs of Army procurements are not as high as those of the Navy or Air Force, continuous deployment brings its own challenges. These include training both for specific deployments while keeping other combat skills current, and having equipment available which is effective and compatible with partner countries.

We have also learnt that we cannot base our doctrine and equipment on the last operation that we have done. Each new commitment is different from the one before. The "one size fits all" model is no longer sufficiently flexible to meet the requirements of a contemporary defence force. 

The range of deployments has meant that the Army has moved away from deploying fixed units. Task forces built around the specific requirements of the operation have become the norm. The Army Transformation Plan is a response to this reality. Through this and other projects, Army has demonstrated how it is adapting to the flexibility required of it. The Review will further develop this process. It will build on the organisational and operational developments that are under way.

It is this flexibility and professionalism in all three services that makes us a welcome partner both in the region and further afield. Our geography and small size has led to the development of forces with a versatile outlook and lighter logistic footprint.

We have developed considerable skills in intelligence, surveillance and reconnaissance, whether on land, sea or in the air. These are skills that are in considerable demand for real world operations. A priority for the Review is how to sustain and build these skills.

New Zealand's defence capabilities must be matched to our strategic interests. Those capabilities will be judged by how well they allow us to respond to a range of military deployments. The success of the Review will depend on how well we can meet the challenge.

In 1950, Governor General Sir Bernard Freyberg farewelled the Army contingent to Korea with these words: "The reputation of New Zealand is in your hands. I wish you God speed and a safe and quick return."

In many countries around the world, you continue to be the standard bearers of New Zealand's reputation.

It is likely that in the decade ahead there will continue to be a high level of operational deployments. The missions you have and the countries where you will be needed will change over time. What will not change are the values, skills and professionalism that the NZDF contribute. Our reputation is in good hands.

Thank-you.