A message from Jens Goennemann

The strategic importance of manufacturing is always more appreciated in times of crises, and the federal budget shows that the COVID lesson is remembered, and I’d like to highlight a few new investments of relevance.

Over a billion dollars in new spending was announced for manufacturing, in a budget framed around resilience. A reported seven-tenths of this will be in the form of regional grants through the Modern Manufacturing Strategy and Supply Chain Resilience Initiative.

Included in the budget was support for a mRNA vaccine manufacturing plant in Victoria, enabling the entire country to better respond to future pandemics. This is good news. We can’t and we shouldn’t try to do everything ourselves. Therefore, we need to focus on the few right things and critical health capability is certainly one of them.

We were also pleased to see $53.9 million for a third round of the Manufacturing Modernisation Fund since the last two rounds of the program were heavily oversubscribed – and why wouldn’t they be popular when you get dollars on top of gear you would have gotten anyway?

Now is a good opportunity to move away from purely spending on capital equipment with one dollar on top of every three dollars for a new machine. We advocate to tailor the Manufacturing Modernisation Fund to rather encourage investment along the entire manufacturing ‘smiley curve’ rather than focussing on its middle, lowest value adding element only.

A smaller and interesting item was $4.7 million over five years to encourage women into manufacturing. This is a subject we take very seriously at AMGC and continue to research how we can do better. Our industry would be stronger if everybody understood it offers rewarding, well-paid, satisfying careers for both male and female workers.

Though not specifically manufacturing programs yet well within the scope of our six National Manufacturing Priorities, there were many other items with very real implications for our manufacturers, including patent box schemes for low-emissions and agricultural technologies, an extra $60.4 million for the Recycling Modernisation Fund, and $1.2 billion over 15 years for a National Space Mission for Earth Observation.

Last Tuesday’s budget provided no new funds for the Industry Growth Centres, including ours, and this was always going to be the way. When we started in 2015, the direction was made obvious: a few years of Commonwealth funding, then an imperative to become self-sufficient and industry lead.

To AMGC, this is great news. We have clarity, we have purpose, we have a healthy runway, and we have some incredibly exciting stuff under development as we shift into the next part of our life cycle.

You expect and deserve an update, but for this moment we have to bite our tongues.

AMGC has changed the conversation around manufacturing, and our formula of direction-setting research and demonstrations of this in action through co-investment in projects have helped show why manufacturing matters. We have co-invested $50 million in funds in projects, which have led to additional revenues north of $2 billion, and over 4,000 jobs. We have demonstrated how the AMGC formula works and which is a no-brainer.

Our success in co-investing and then nurturing pathways to economic success has been noticed by governments other than the Commonwealth. Seeing the value of our work, and of advanced manufacturing to diversify and strengthen the economy, the Northern Territory government recently partnered with us on the $7.5 million Advanced Manufacturing Ecosystem Fund (AMEF).

Other states, territories and local governments are very interested in our formula, how we can help them transform and advance manufacturing for all the wealth, highly skilled jobs, and capability it can deliver.

Further than that, we have an abundance of prospects through both public and private entities with one thing in common: they all understand that manufacturing is key for Australia to move from a lucky country to a smart one.

We will be in a better position to share our plans at Australian Manufacturing Week in June. Come visit our room and we can make ourselves clearer on what exciting news we can share.