Industry Minister Ian Macfarlane has plunged Australias Future Submarine Project into chaos.

Minister Macfarlane has finally admitted that, under the Abbott Government, South Australia may not build the first few submarines.

The Coalition made an election promise to build 12 submarines in South Australia.

Since the election Tony Abbott has broken this promise and crab-walked away from his commitment to South Australians.

In February, the Prime Minister announced a sham process to save his own job and deliver his Captains Pick on Japanese submarines.

The Government has also confessed that its farcical Competitive Evaluation Process is not designed to deliver any construction jobs in Australia.

In answer to Question on Notice 40 from Defence Estimates in February, the Government admitted that of the 500 jobs they claim will be delivered, none of these will be in submarine construction.

Now it is only offering South Australia the consolation prize of sustainment and maintenance.

In recent days we have seen the Government hide behind a phantom audit designed to denigrate Australias shipbuilding industry.

The Governments chaos and dishonesty on submarines and shipbuilding is hurting jobs, hurting the economy, and creating uncertainty for our defence force.

Instead of delivering 12 submarines in Adelaide, this Government has delivered the loss of 450 jobs at Forgacs in Newcastle, 120 jobs at ASC in Adelaide, and hundreds of jobs at BAE in Williamstown.

Thousands more are at risk.

Labor is committed to building, maintaining and sustaining Australias future submarines in Australia.

Only Labor has a credible plan to build the submarines Australia needs to protect our national strategic interests.