Prime Minister Tony Abbott insists he trusts Defence Minister David Johnston and thinks he is doing an "absolutely outstanding" job.
Labor leader Bill Shorten has called for Senator Johnston to be sacked for saying he wouldn't trust Australian submarine makers to build a canoe.
"I trust this minister for defence to deliver us a competent, professional and effective armed force," Mr Abbott told the parliament during question time on Wednesday.
"The minister for defence is doing an outstanding job, absolutely outstanding job following six years of neglect by members opposite."
The prime minister said Mr Johnston had engaged in a "rhetorical flourish" in his comments to the Senate yesterday.
"He said something in the Senate which he shouldn't have said, which he didn't mean, which he's withdrawn and which he's apologised for," Mr Abbott said.
"He does not deserve to be undermined by members opposite because of a slip of the tongue in the Senate yesterday."
Labor also hounded the defence minister in the Senate, asking how he could continue his role given the denigration of ASC workers.
"This morning, I took my medicine for an hour. And I don't think I'm the first one," he said in question time.
"I did say something that I regret. I believe the prime minister has full confidence in me."
Senator Johnston was then asked to respond to comments made by South Australian Liberal leader Steven Marshall, who said his position as minister was untenable.
He said he admired Mr Marshall, considered him a friend, and accepted his criticism.
"Steven Marshall is a very fine man and should be the premier of South Australia," he said.
