Defence CEO resigns; industry feels pressure

The CEO of the Defence Materiel Organisation (DMO) Dr Stephen Gumley has resigned, amid one of the toughest times for the defence manufacturing industry in Australia’s history.

The outgoing CEO pioneered “great change” in the industry, and made an important contribution to its success, according to Ai Group chief executive, Heather Ridout.

"The Australian Industry Group Defence Council National Executive has enjoyed a constructive and productive relationship with Dr Gumley. He worked hard to develop the relationship between Defence and industry at a time when Australia has been engaged in a series of high intensity overseas conflicts,” she said.

"He delivered a number of important improvements to defence procurement and has demonstrated a deep awareness of the need for the industry to be properly skilled for the challenges before it and the broader economy.

"Dr Gumley oversaw the implementation of the Kinnaird and Mortimer Reviews, both of which focused on structural and policy changes aimed at improving procurement outcomes. He worked assiduously to upskill and improve the culture within the DMO, leading to many improvements in the engagement between defence and industry including on tendering and contracting issues.

"The Defence Council thanks Dr Gumley for his consultation and constructive engagement during his tenure.”

Last month, Shadow Innovation Minister Sophie Mirabella accused Innovation Minister Senator Kim Carr for ignoring Australia’s clothing industry, after a local defence apparel contract was won by a US competitor.

“Shock evidence at this week’s Senate Estimates hearings from Defence Materiel Organisation (DMO) officials has revealed that innovative Australian TCF businesses lost $7.8 million to US competitors in potential contracts to supply a new camouflage combat uniform. Worse still, the work could have been completed at a fraction of the price if undertaken locally,” she said in June.

“This is a breach of procurement guidelines and a stunning repeat of earlier disasters in the administration of defence industry contracts. These have included the Government allowing contracts to purchase camouflage fabric from China and its refusal to reinvest in the critical DMTC Soldier Survivability program.”

A future CEO hasn’t been appointed for DMO just yet, and the Ai Group has spoken out about the pressures that sector is under from globalisation and offshoring.

"Given the pressures on the Australian defence industry, and the need for ongoing improvements to defence procurement, we look forward to an early announcement about the future leadership of defence procurement," said Ai Group’s Ridout.

 

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