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buglerbilly
25-06-10, 02:57 PM
Building Defence Capability: A Policy for a Smarter and More Agile Defence Industry Base

(Source: Australian Department of Defence; issued June 25, 2010)

(All monetary amounts are in Australian dollars – AUD)

Greg Combet, Minister for Defence Materiel and Science today launched the Government’s new Defence Industry Policy Statement – “Building Defence Capability: A Policy For a Smarter and More Agile Defence Industry Base.”

“The Government needs a strong, successful and skilled defence industry if it is to deliver the ADF that Australia needs for the future, which is why we have outlined this comprehensive suite of programs for the Australian defence industry,” said Mr Combet.

“The Government is committed to increasing the opportunities for Australian defence industry to identify and make the most of business opportunities within Australia and overseas.”

Building Defence Capability is closely aligned to the Government’s White paper and Strategic Reform Program.

“The policy outlines over $445 million of Government programs that industry can access to improve their competitiveness, their capacity for innovation, their ability to enter export markets, their opportunity to win work locally and the skills of their workforce.”

The policy is based on four key principles:

-- Setting clear investment priorities: Defence industry investment priorities must be driven by clear guidance on the Government’s endorsed strategic tasks for Defence and the military capability needs that derive from these tasks. The Statement provides a much clearer outline for the first time of information that will help local firms plan their investment priorities.

-- Establishing a stronger Defence – industry relationship: The Statement advances a considerably more flexible approach to defence procurement and contracting, where varying kinds and levels of risk are managed through the appropriate procurement and contractual vehicles.

-- Seeking opportunities for growth: The Government will seek to encourage a competitive industry base that has opportunities to grow and is supported by forward-looking and flexible Government policies. This will increase the opportunities for Australian defence industry to identify and make the most of business opportunities within Australia and overseas.

-- Building skills, innovation and productivity: The Government will ensure that Australian defence firms have every opportunity to enhance their capacity for innovation, skilling and productivity. This is important for Australia’s defence and will help to sustain viable defence industry enterprises into the future.

“These principles have dictated the Government’s strong and comprehensive suite of policies designed to build and improve the Australian defence industry.”

“These policies have increased innovation and skills formation within the industry, improved productivity and supported local small to medium sized enterprises (SMEs).”

Building Defence Capability In addition to explaining and improving these policies also outlines a number of new policies and programs.

“The new $44.9 million Priority Industry Capability (PIC) Innovation Program will provide funding to companies to encourage innovation in the area of PICs. Under this Program companies will be encouraged to submit innovation proposals relating to PICs to attract funding.”

“The Defence Industry Innovation Board will better coordinate the innovation programs that are available to industry. This board will feature representatives from both Defence and Industry and will oversee the PIC Innovation Program.”

“The $59.9 million Global Supply Chain (GSC) Program will facilitate opportunities for Australia defence industry to compete in the defence primes global supply chains. The Government is strongly committed to helping Australian companies win work around the world.”

“The Australian Industry Capability (AIC) Implementation Unit will improve implementation of AIC policy within Defence and audit System Project Offices to ensure AIC plans in contracts are delivered.”

“The Government will continue to work closely with defence industry to provide the support they need to deliver the equipment and capabilities that our ADF need to get the job done.”

“The Government needs a strong, successful and skilled defence industry if it is to deliver the ADF that Australia needs for the future.”

“Building Defence Capability provides the framework to ensure that Australia has the defence industry it needs to deliver and support the future ADF.”

Click here for the full report (112 pages in PDF format) on the Australian DMO website. (ends)

http://www.defence.gov.au/dmo/id/dips/DIPS_2010.pdf

Skills, Innovation and Productivity Critical to Defence

(Source: Australian Department of Defence; issued June 25, 2010)

Investment in skills, innovation and productivity is critical to the Federal Government’s plan for building a more competitive defence industry in Australia, the Minister for Defence Materiel and Science Greg Combet told industry leaders in Canberra today.

Under the Federal Government’s comprehensive Defence Industry Statement, Building Defence Capability: A Policy for a Smarter and More Agile Defence Industry Base, released today, the Government will, over the next five years:

-- Invest $292.8 million towards innovation, boosting productivity and skills development in the Australian defence industry.

-- Create more than 7,500 training opportunities under programs such the Skilling Australian Defence Industry, Defence Technical Scholarships, Master of Systems Integration, Masters of Systems Support Engineering and other programs.

-- Provide up to $188.8 million in funding towards the Defence innovation.

Mr Combet said that the investment in skills, innovation and productivity underscored the Government’s commitment to the future of Australia’s Defence industry.

“The Federal Government is committed to helping to build a more competitive and more productive defence industry in Australia,” Mr Combet said.

“That’s why we have outlined a plan for investment in skills, innovation and productivity to help the industry develop its workforce and gain a competitive edge.”

Mr Combet said that skills and innovation was a key driver of productivity and the Government’s investment would better position Australia’s defence industry in the global market.

“Australia’s defence industry cannot maximise its productivity and its competitiveness without increasing its capacity for invention and discovery,” Mr Combet said.

“The Government investment in skills, innovation and productivity will ensure the sector has the best chance of competing against others around the world.”

Click here for the transcript of Combet’s speech introducing the new policy, on the Australian DoD website. (ends)

http://www.minister.defence.gov.au/gregCombetTranscripttpl.cfm?CurrentId=10505

Helping Australian Defence Businesses Win Work from the World

(Source: Australian Department of Defence; issued June 25, 2010)

Greg Combet, the Minister for Defence Materiel and Science, announced today significant programs worth over $100 million to help Australian defence businesses win work in the global defence market.

Mr Combet said that three key policies will assist local businesses to access and win work from the global defence market. They are the:

-- Global Supply Chains Program
-- Defence Export Unit
-- New Air Combat Capability Industry Support Program

“The Global Supply Chains (GSC) Program will create opportunities for Australian industry in the global supply chains of overseas defence prime contractors and their major subcontractors,” said Mr Combet.

“Under the GSC program, primes develop company-specific programs to evaluate Australian suppliers for participation in their global supply chain.

“Given the lucrative opportunities available in these global supply chains, encouraging exports is a crucial element of the Government’s defence industry policy.

“As outlined in the Industry Policy Statement, the Government has committed almost $60 million over ten years to the GSC Program.

“The Government, shortly after it came to power, also launched the Defence Export Unit in order to boost defence industry exports and advance important industry capabilities required for the ADF.

“The DEU has been a great success and has helped Australian companies so far win contracts in excess of $550 million. That is why in this Statement the Government is provided funding of $34 million out to 2019 for this Unit.

“The Government has also established the New Air Combat Capability Industry Support Program, which will provide funding to Australian companies and research organisations to support the development of new or improved capabilities that may enhance winning work in the production, sustainment and follow-on development phases of the Joint Strike Fighter Program.

“These programs are necessary given the changing structure of the defence industry.

“There has been significant consolidation and globalisation of the defence industry. This consolidation has resulted in a domestic defence industry dominated by a small number of very large defence companies, mostly headquartered in Europe and North America.

“Australia’s defence industry policy needs to evolve to take account of this contemporary industry structure.

“Australian-owned defence firms are generally small to medium sized enterprises (SMEs). In turn, this presents both challenges and opportunities for Australia’s defence industry. It is a challenge for small to medium enterprises (SMEs) that need to accommodate major investment decisions made in Europe and North America. Yet it is also an opportunity for Australian SMEs to make profits through integrating into the global supply chains of international primes and their major subcontractors.

“Exports can develop and enhance industry capabilities by sharing development and non-recurring engineering and overhead costs with other customers.

“In addition to the benefits for exporters, finding overseas customers for Australian products and services used by the ADF helps to create economies of scale for Defence,” Mr Combet said.

These programs form part of the Government’s Defence Industry Policy – titled “Building Defence Capability: A policy for a smarter and more agile defence industry base.” (ends)

Priority Industry Capability Innovation Program

(Source: Australian Department of Defence; issued June 25, 2010)

Greg Combet, Minister for Defence Materiel and Science, today announced the establishment of the Priority Industry Capability Innovation Program.

“The new $45 million Priority Industry Capability (PIC) Innovation Program will provide more direct and practical programs to Australian defence industry, particularly SMEs, for PIC related activities,” Mr Combet said.

“This is a fantastic program that will build strong Australian industry capabilities in our most important strategic areas.

“This new program will also benefit the Australian Defence Force which relies on a strong and innovative defence industry sector.

“Under the PIC Innovation Program, companies will be encouraged to submit to Defence innovative proposals, relating to one or more PICs, to Defence for direct funding.

“To attract funding, proposals must clearly support one or more PICs and must have good prospects for driving additional work in Australian industry or provide cost savings for future Defence contracts.

“Funding provided under the PIC Innovation Program will be in the form of a contractual arrangement with the company, and will be limited to $3 million to $4 million in any one instance.”

Defence will develop a set of guidelines for the operation of this program in time for the first annual funding round in late 2010.

The new Defence Industry Innovation Board will oversee the PIC Innovation Program and advise Defence and the Government on appropriate resource allocation under the program.

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buglerbilly
30-06-10, 03:52 PM
Setting Clear Investment Priorities

(Source: Australian Department of Defence; issued June 30, 2010)

Greg Combet, Minister for Defence Materiel and Science, today said that the Government’s new Defence Industry Policy had established new and clear investment priorities for the Australian Defence Industry.

“The Government’s new Defence Industry Policy Statement – Building Defence Capability – A Policy For a Smarter and More Agile Defence Industry Base - gives new and unprecedented investment guidance to local firms who wish to succeed in the defence industry,” said Mr Combet.

“The industry has made clear to me that one of their primary concerns is to obtain information from Government that will lead to greater investment certainty.

“For this reason the Government has outlined in great detail the Priority and Strategic Industry Capabilities and also explains the Government’s approach to these capabilities.

“The first principle of the Government’s defence industry policy is that defence strategy and the capability needs of the ADF will determine Defence’s investment priorities.

“The Public Defence Capability Plan is the principal means through which the Australian Government signals to industry its defence capability needs and intentions for future major capital equipment acquisitions.

“However, the Government has also outlined a series of Priority Industry Capabilities (PICs) that are strategically important to the ADF.”

“PICs are those industry capabilities which would confer an essential strategic advantage by being resident within Australia, and which, if not available, would significantly undermine defence self-reliance and ADF operational capability.”

There are currently 12 PICs which are outlined in the Building Defence Capability.

“In order to provide greater investment certainty for the industry the Government has also outlined principles the Government may consider in acquisition and sourcing decisions related to PICs,” said Mr. Combet

“When making procurement and sourcing decisions related to PICs, the Government will always emphasise the need to obtain value for money for the Australian taxpayer through competition. This calculation will take into account factors such as Australian industry impacts, the national interest, broader strategic factors, and other whole-of-government considerations.

“Defence is currently assessing whether there is adequate investment in the PICs, based on known acquisition and sustainment demand, to maintain them at an appropriate level of capability to meet the ADF’s needs.

“It is important that local defence industry understands that the listing of a capability as a PIC will not in itself lead to Government financial assistance.”

Actions to sustain a PIC may include:

-- demand management: managing the timing of new projects through the Public DCP to maintain regular work where possible;

-- access to export promotion, skills development and company activities through programs such as Skilling Australia’s Defence Industry (SADI) and the Defence Industry Innovation Centre (DIC);

-- developing longer term contracting arrangements;

-- accessing the PIC Innovation Program; and

-- in some cases, ensuring that requests for tender seek separate costings for work that must be undertaken in Australia.

“Due to their potential to become PICs, the Government also monitors a broader range of capabilities, known as the Strategic Industry Capabilities (SICs),” said Mr. Combet.

“The SICs are capabilities which provide Australia with enhanced defence self-reliance, ADF operational capability, or longer term procurement certainty. They are outlined in detail in Building Defence Capability.

“The SICs are important, but will merit less oversight than PICs. For example, if the Government believes sufficient domestic demand can sustain that capability – for example ship maintenance, or that the industry capability is closely linked to demand in the wider economy and hence is more sustainable.

“To gauge the overall condition of the SICs, Defence will consider factors such as the proposed level of utilisation of these industries offered through tender responses, the performance of these industries under contract, Company ScoreCard information, and information obtained through engagement with industry associations and the network of Business Access Offices.

“Where they occur, both types of industry capabilities will be identified in projects appearing in the Public Defence Capability Plan. If a PIC element is listed this will require industry to specify a costed locally based option for that part of the tender. However, this requirement will always be subject to value for money considerations and other whole of Government considerations.”

-ends-