Prime Minister Scott Morrison is urging government agencies to get behind a 10-year manufacturing strategy that will support co-investment between the public and private sectors across a number of key industries.
Under a $1.5 billion industry/government collaboration plan that will be detailed in Morrison’s speech to the National Press Club later today, manufacturers will be supported to upscale their businesses and integrate with global supply chains.
The package, which is the latest government funding pledge in the lead up to the federal budget next week, has invariably picked a number of winners, namely six priority industries:
- Resources technology and critical minerals;
- Food and beverages;
- Medical products;
- Recylcing and clean energy;
- Defence; and
A total $1.3 billion will be spent in these industries over the next four years, starting in 2021, and government is being asked to pull in the one direction with businesses, capital investors and the scientific research community to turbocharge Australia’s manufacturing base.
Morrison believes past industry policies have erred in the past by focusing on subsidies that don’t tackle foundational deficiencies in economic settings, something this latest strategy will look to address.
“The overarching objective of our modern manufacturing strategy is to build scale and capture income in high-value areas of manufacturing where Australia has either established competitive strength or emerging priorities,” Morrison will tell the press club.
This latest policy announcement comes amid significant learnings in the wake of the COVID-19 pandemic, when, amid disruption to global supply chains, countries around the world, including Australia, rushed to purchase tonnes of personal protective equipment and other products after realising their own manufacturing bases were lacking.
In the months since, many local companies have re-tooled to produce many in-demand goods locally, and in that sense, the government’s new manufacturing strategy will look to formalise a lot of this work, with an intention to support broad-based industry development in priority areas.
Morrison will commit government agencies to partnerships with industry in the hope a plan can be drawn up by next April for each sector.
This will include benchmarks for job creation, R&D levels and investment over two, five and ten year windows.
Further, these industries are expected to benefit from investment incentives, low energy costs, flexible industrial relations provisions and an environment of low taxes, Morrison will explain.