Defence will be given an extra $50 billion over the next decade as part of a shake-up of the Australian military.
Launching the first national defence strategy in a major speech on Wednesday, Defence Minister Richard Marles unveiled a boost to spending in the sector, citing the most challenging strategic environment since World War Two.
An extra $5.7 billion will be spent over the next four years, taking defence funding to 2.4 per cent of GDP by 2033/34.
The funding will include an $11.1 billion boost to speed up the delivery of the Navy's surface combatant fleet and to expand the shipbuilding industry.
Annual funding for defence will surpass $100 billion in a decade's time.
"The inaugural national defence strategy sets out a clear and priority-driven approach to protecting against threats to Australia and our interests," Marles said.
"The Albanese government is making an historic investment in defence and has taken tough decisions to reshape the ADF to meet our strategic circumstances and to keep Australians safe."
The strategy has also called for a widening of the eligibility for the defence force to bolster recruitment.
It also recommended the potential recruitment of non-Australian citizens, as well as encouraging defence personnel to serve longer through retention initiatives.
The government released a defence strategic review in April last year, which found the Australian Defence Force was no longer fit for purpose.
Last year, the government announced it would cut plans to build 450 infantry fighting vehicles down to 129.
Hundreds of defence force personnel will also be moved from southern bases to northern ones as the nation prepares for a possible conflict in the Indo-Pacific.
Opposition defence spokesperson Andrew Hastie said for the defence minister to pass the test of leadership, the new plans "must be more than just vague language, vague promises and vague time frames".
"There must be real money, real commitment and real leadership," he said.
"Richard Marles must be honest with the Australian people about the threats and challenges we face.
"This must be matched with a meaningful increase in Defence spending and a clear strategy — real money, and a real direction. These are the metrics that count."
