EARLIER this year, Feb 24 to be precise, Barack Obama told US citizens, “I do not accept a future where the jobs and industries of tomorrow take root beyond our borders”.
This simple, but powerful statement should be etched on every Australian government official’s mind, whether they represent us at local, state or federal level.
Governments at all levels have a major role to play in ensuring we have a vibrant, viable manufacturing industry and how they direct their purchasing decisions is one sure way they can get involved. Manufacturing is too important to Australia’s economic future to let it slip away. For once it’s gone, it’s gone.
Industry minister, Senator Kim Carr, has made it clear the Federal Government, and in turn all governments, are able to buy locally produced goods to support Australian jobs without breaking world trade rules.
He supports the idea of government procurement to help the Nation’s manufacturing industry; however all we have heard to date is rhetoric, and what schemes we do have aren’t working too well.
There was an interesting article in the Fin Review a few weeks ago where several state bodies with multi-million budgets in Victoria were questioned on how they apply the State’s Victorian Industry Participation Policy (VIPP).
Incredibly, procurement staff at Victoria Police, who had just spent several million dollars buying new uniforms, the Dept of Human Services, and regional rail operator V/Line all failed to take into account the VIPP scheme when placing orders.
Since the scheme was introduced in 2001, all bidders for government contracts in Victoria over $3m in metropolitan areas and $0.5m in regional areas must complete a statement as part of their tender outlining local content and job creation. These statements are supposed to be considered by officials.
But Freedom of Information documents obtained by the Fin Review reveals big-spending agencies are yet to use the scheme in practice.
Most governments have some form of local purchasing policy. For example, the Commonwealth expressly forbids departments to discriminate against foreign suppliers but also sets a 10% target of contracts to be let to SMEs.
The States each have their own versions, which while on paper all sound great, in practice many are being ignored, or even worse specifications are written for a specific imported product.
It is obvious, a little more policing of the schemes, plus a little more transparency would not go amiss.
Green Action Plan
Like Australia, US manufacturing has been hit hard by the world’s economic slowdown, losing a total of 4.4 million jobs since 1999.
In an attempt to reverse this trend, a national coalition of union, business, community, and environmental leaders, called the Apollo Alliance, has developed a green manufacturing action plan (GreenMap), as part of the US’s “Make it in America” program (www.apolloalliance.org/GreenMAP).
Clean energy is said to be one of the most promising new ventures around the world, with the US domestic market for solar panels, wind turbines, fuel cells, and biomass engines, for example, projected to reach US$226bn by 2016.
Demand for solar and wind power is expected to expand substantially over the next 20 years, with 70 to 80% of the new jobs in the manufacturing sector.
To this end, the Alliance has created a clean energy roadmap for revitalising America’s manufacturing sector, with five key recommendations: Provide direct federal funding for clean energy manufacturers to retool their facilities and retrain their workers; condition government support to manufacturers on their ability to meet labour and domestic content standards; increase funding for the Manufacturing Extension Partnership (www.mep.nist.gov); increase funding for the Green Jobs Act (http://solis.house.gov/list/press/ca32_solis/wida6/greenjobscomm.shtml xi); and create a Presidential Task Force on clean energy manufacturing.
The Alliance calculates that US$50bn of federal and private investment in industrial retooling and retraining programs would create 250,000 direct manufacturing jobs in the US, support an additional 725,000 indirect jobs, and generate as much as US$120bn in revenue.
If the figures can add up in the US, why not here?
Congratulations
First I would like to thank all readers for completing our reader survey earlier this year.
The information we gathered will ensure the magazine continues to contain the information you need to drive your manufacturing operations. For those readers who interested to see the results please email me at alan.johnson@reedbusiness.com.au.
Congratulations go to Shane Wall, production manager with Haigh’s Chocolates in South Australia, who is the lucky winner of the 16GB iPod Touch.