Subs criticism rises as production line breaks surface

As Australia takes its first steps to establish to a nuclear-powered submarine production line, the Labor announcement was torpedoed by one of its own.

Former prime minister Paul Keating fired a withering salvo at his former party when he labelled AUKUS as the worst international decision by a Labor government in more than a century. 

"(It is) the worst decision by an Australian Labor government since the former Labor leader, Billy Hughes, sought to introduce conscription to augment Australian forces in World War I," Mr Keating told the National Press Club on Wednesday.

As the former PM unloaded over the deal, more questions were raised about its $368 billion price tag and how nuclear waste would be disposed.

But the government shrugged off the criticism as it announced the Commonwealth would hand over defence land to South Australia to enable the Osborne shipyard to build the nuclear boats, alongside production lines in the US and UK. 

The government will also back an additional 800 university places in South Australia for engineers and scientists. The first 200 students will start in 2024, with an academy be set up at Osborne for apprentices and trade training.

Australia, the UK and US have outlined the path to acquiring eight nuclear-powered submarines over the next three decades. 

"Developing this capability for our nation will make our nation more safe. Developing this capacity for Australia will have us be taken more seriously around the world," Defence Minister Richard Marles said. 

"We have to take the step of developing the capability to operate a nuclear-powered submarine so that we can hand over a much more self-reliant nation to our children and to our grandchildren." 

South Australian Premier Peter Malinauskas said his state was ready to do whatever it takes.

"The Commonwealth sees in South Australia the ability to build the most complex machines that have ever been produced in the history of humanity," he said.

China warned the nuclear submarines were setting AUKUS on a "path of error and danger" that disregarded international concerns.

Opposition defence spokesman Andrew Hastie hit back at the comments, describing them as hypocritical.

"They are undergoing the biggest peacetime military expansion since the Second World War, which includes nuclear weapons. So to lecture us is rather ironic," he said.

Mr Hastie said it was important to maintain a relationship with China, but the strategic environment was deteriorating. 

Mr Keating said it was nonsense to suggest China was strategically interested in anything other than to "keep their front door clean".

He said China would relish a better relationship with Australia.

"They would fall over themselves having a proper relationship with us," he told the National Press Club.

"We've manufactured a problem. Don't let the sleeping dogs lie, we're giving the old dog a kicking."

The plan to dispose of nuclear waste from the submarines is also becoming a point of contention.

The Australian Conservation Foundation said the government had been silent about how the nuclear material powering the submarines would be disposed.

Mr Marles said the submarine waste would be stored on defence land and Australia had time to make sure the process was done properly.

A plan outlining how the waste will be handled is due to be released this year. 

The massive price tag of up to $368 billion for the agreement has also been questioned, with independent senator David Pocock saying the government had continually pointed out how tight the budget was. 

"We've heard we can't spend money on things that are really important to our communities and to our country. This is a massive spending commitment for decades to come," he said.

"Clearly that money has to come from somewhere."