28 March 2012
Four ‘pillars’ policy to revive manufacturing
The Sydney Morning Herald
Australia's biggest manufacturing companies will push a four-prong policy to safeguard the sector, which is being squeezed by the high dollar and low-cost competitors.
Dick Warburton, the executive chairman of Manufacturing Australia, which represents the country's seven biggest manufacturers, will outline the four policy "pillars" to ensure a viable manufacturing sector at an industry forum in Sydney today.
The first "pillar" is better resourcing and implementation of "anti-dumping" trade rules. This would include better training of customs officials and government officers responsible for policing anti-dumping practices at Australian docks and airports.
Manufacturing Australia's second pillar is the reduction and streamlining of government regulation of manufacturers. Some manufacturers have to deal with scores of authorities in the operation of their businesses and the group will argue the cost of compliance is unsustainable given the tough international operating environment now faced by manufacturers.
Rather than being asked "to do more for manufacturers", governments will be asked what "they can they can do less of" by way of regulation in order to reduce manufacturing costs, an industry source said.
The third policy pillar is targeted changes to industrial relations provisions to reduce compliance costs, especially for big employers. The fourth pillar is to find ways for manufacturers to benefit more from Australia's energy and resources, including access to competitively-priced energy.
The Herald understands the group will argue the sector thrives in countries that effectively exploit their competitive advantages and, in Australia, that means making the most of abundant natural resources.
The chairman and chief executive of Dow Chemicals, Andrew Liveris, will address today's "Future of Manufacturing in Australia" forum along with CEOs from some of Australia's biggest manufacturing firms.
Manufacturing's share of economic output has fallen from above 14 per cent to 8.6 per cent in the past 20 years. But it still accounts for 8.3 per cent of all employment - about 950,000 jobs.
But the strength of the Australian dollar - which has been above parity with the US dollar for an extended period - has coincided with a spate of high-profile job losses in the sector. There are warnings, including from Mr Warburton, that manufacturing is under severe threat unless its global competitiveness can be improved.
Goran Roos, an international expert who is advising the Prime Minister's manufacturing task force, says that the exchange rate's rise has made Australia the world's sixth most expensive place for manufacturing. Up until about 2008, Australia was cheaper than the US but now costs are about 20 per cent higher.