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The federal opposition has outlined a new plan aimed at bolstering regional participation in the local defence supply chain.
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Shadow minister for defence industry Matt Keogh has announced the 'Regional Defence Procurement Policy' — a new standard designed to bolster defence opportunities for SMEs based in the regions by “decoding and simplifying” procurement processes.
If elected to government, Labor has pledged to:
- ensure the maximum local spend, while ensuring value for money;
- generate job opportunities;
- build local management capacity;
- facilitate training via apprenticeships; and
- increase diverse employment through greater employment of women and Indigenous.
To support the achievement of these objectives, Labor has committed to:
- ensuring defence tenders for work in regional areas with a value of more than $10 million include a ‘Local Industry Capability Plan’;
- ensuring defence tenders for work in regional areas with a value of more than $75 million develop a ‘Regional Procurement Plan’ ahead of key project decisions; and
- referring proposed contracting models to the minister for defence tenders valued at over $100 million.
Labor’s proposal also involves establishing a local procurement presence in key regions across the country, led by a local procurement officer.
The procurement officer would be tasked with proactively identifying local companies capable of supporting Defence projects while also assisting them in pre-qualifying as Defence contractors.
Townsville and Darwin have already been identified as key locations for the initiative, which would reportedly be supported by "existing Defence resources".
“One of the barriers to SMEs to getting a ‘look in’ on Defence procurement is less familiarity with the procurement process, and less familiarity for Defence with the businesses in regions,” Keogh noted in a statement provided to Defence Connect.
“A local procurement policy ensures that when tenders are being developed, larger companies will be required to evaluate who in the local supply chain can contribute to the project.”
This proposal is expected to build on the current government’s establishment of the Office of Defence Industry Support (ODIS).
ODIS — which replaces the Centre for Defence Industry Capability — aims to serve as a ‘one-stop shop’, facilitating stakeholder access to local SMEs with the capability to support defence projects.
This involves setting up dedicated regional support teams to identify regional SMEs with the capability to enter the Defence market.
However, according to Keogh, ODIS only involves sending travelling teams to offer “pop-up” services in the regions, rather than establishing a permanent presence.
He also claimed that unlike Labor's new proposal, ODIS initiatives “are not linked directly to procurement”.
[Related: Defence launches ‘one-stop shop’ for local industry]
