So we're starting in the '70s but before the Whitlam Government came to power (1972), so we might as well say at the beginning of the '72-'73 financial year. Ironically, defence spending for that year was in the range specified at 2.6% of GDP, but fell to 2.4% the following year and hovered between that and 2.3% until a brief spike in the early '80s (hitting 2.6% in '82-'83). If we said that defence spending was retained at even just 2.6%, through the '70s, then the difference is at least 8.3% or so every year. That's a significant increase. But you have to weigh this against the fact that the inflation rate was very high through these years, which affected wages and other costs. Still, it should lead to some major changes.
If we look at what the Whitlam Government did when it came to power, it not only immediately ended conscription (which I don't think there is any driver to change necessarily), it also paid off the HMAS Sydney, disbanded one of the four operational squadrons of Mirages, and halved the Sea King order from 20 aircraft to 10. So, if the funding is not cut, we could at least see the latter two decisions butterflied away. The last of these is particularly important.
If the RAN ends up with 20 Sea Kings, and you have a bipartisan commitment to maintaining defence funding above 2.5% of GDP, then you are much more likely to see a replacement of the HMAS Melbourne. Assuming much of the planning and studies (and internal politics) goes as historical, then what you have is a decision being made in 1980 to acquire a purpose-designed ship equipped with helicopters for anti-submarine warfare, with the capability to operate STOVL aircraft. At the time, the preferred option was - I believe - a modified Iwo Jima Class to be built in the US with gas turbines. Historically, the decision wasn't made and there was much dithering until the carrier wasn't replaced directly, but rather with the building of two more Adelaide-Class FFGs (Oliver Hazard Perry-Class). Here, funds would not be so tight and you'd have twice the Sea Kings already in service, so I think it likely that we will see a new ASW carrier built in the US and entering service in the mid '80s.
With a continuing increase in funding compared to the historical, I think we would also likely see a buy of Sea Harriers - maybe as many as 16 single-seaters and four two-seaters - to restore a fighter capability to the Fleet Air Arm. (I'm expecting a gap between the Melbourne leaving service and the replacement commissioning.) While talking about the Fleet Air Arm, I think we're also less likely to see such a gap between the commissioning of the Adelaide-Class FFGs and the introduction of the SH-60s.
The above - together with the additional defence investment - would see further changes. I've mentioned that the two additional Adelaide-Class FFGs wouldn't have been built in the mid-80s as replacements - in effect - for the Melbourne. But I think it likely that frigates would still have been built, just as replacements for the River-Class. The first of these paid off in the mid '80s. That means that, in effect, you have the Anzac program brought forward, and this would have looked very different. The Adelaide-Class might have been chosen, but perhaps four instead of six or eight ships. Then in the '90s you might see work begin on a class of four new destroyers to replace the three Perths. If not Burkes ordered from the US, then maybe a domestic built, upgraded version of the Spruance / Kidd design.
In terms of support, interestingly enough another order cancelled by the Whitman Government was for a replenishment ship to replace HMAS Supply. This would have been known as HMAS Protector. Not only would this order likely not have been cancelled, but a follow-on ship may have been ordered. This butterflies away the historical HMAS Supply. You might also see a second Tobruk ordered.
Another interesting fact is that there was originally an order for four additional Oberon Class submarines - on top of the four already then in service - that was cut to two in the early '70s. Now if that decision doesn't happen then you have eight boats in service from the early '80s, and we could also expect an earlier and larger Collins program.
This is all just considering the Navy, but I think this is where the changes would be most evident.
