Australia faces ''clear and present dangers'', including instability in Asia, that justify boosts to military spending even while the rest of the budget suffers deep cuts, Defence Minister David Johnston says.
Senator Johnston said defence had borne the brunt of cuts in recent years and the government was ''steadying the ship'' by shielding the portfolio from the slash-and-burn savings measures.
Defence bucked the budget trend this week with a 6 percent real increase in funding for next year, lifting spending by $2.3 billion to $29.3 billion.
Senator Johnston, in a wide-ranging interview, also backed Air Force Chief Geoff Brown's recent call for Australia to get deadly Reaper drones.
While stressing Australia was some way off developing rules of engagement for armed drones, he indicated the government would have more to say on the matter in next year's defence white paper.
''It is a very important issue and if it provides the levels of force protection that we have observed and seen it capable of, I think it's very worthy of close consideration into the future,'' he said.
On the broad issue of global security, Senator Johnston said there were several flashpoints around the world that meant Australia needed to ''continue with an elevated level of readiness''.
He said Ukraine was one example, Syria another, particularly with Australians, Indonesians and Malaysians all fighting in the civil war-torn country.
He added that the government was ''concerned about the stability of the [Asia] region'' and emphasised that disasters and conflicts could flare without warning.
''We need to be ready,'' he said. ''Weather events, tsunamis, earthquakes, cyclones, are all the sorts of things that the public of Australia expect the ADF (Australian Defence Force) to be able to step up and deal with in a crisis.
“Military threats can be very similar. They can come from nowhere … Friends in the neighbourhood may need assistance for any number of reasons – insurgency, piracy, whatever, so there are clear and present dangers that we need to be ready for.''
Asian countries have been increasing their defence spending, leading some commentators to warn of a regional arms race. Senator Johnston brushed off concerns Australia might be contributing to such a race through the planned steep climb in defence spending to 2 per cent of gross domestic product – which the government has vowed to reach within a decade.
''I think the neighbourhood accepts and understands everything we do because we tell them and explain it to them in clear terms,'' he said. ''I don't believe we contribute to an arms race because I think probably we are the most transparent member of our neighbourhood in terms of what we are doing, and why we’re doing it.''
Senator Johnston also rejected suggestions – fashionable among some foreign policy analysts – that Washington is losing the stomach for intervening in conflicts, even on behalf of allies and partners.
''Not for one moment am I in any doubt that the ANZUS treaty would be a very important part of any consideration … if we were under threat,'' he said.
''The [US] rebalance [towards Asia] would suggest that we don't have anything to be concerned about there because the focus is on our region.''