Prime Minister Scott Morrison has flagged spending on defence will ‘only increase’ in the future. 

Mr Morrison says the world has entered a “new era” of international relations, with “new challenges” for Australia and its partners.

His comments come after a landmark trilateral security pact with the US and UK was announced this morning, along with a new fleet of nuclear-powered submarines.

Australia will also enhance its long-range strike capability to “deter and respond to potential security challenges during the transition to a fleet of nuclear-powered submarines”.

Amid the newly-announced trilateral partnership, Australia has scrapped its $90 billion French submarine program.

“This is about our strategic interest, our strategic capability requirements and a changed strategic environment and we’ve had to make that decision.”

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