What role should the state have in the development of business hubs?
ONE of my favourite WA Business News features was a 2006 story highlighting the incredible array of corporate activity in the once-genteel suburb of West Perth, a mining hub we dubbed the ‘New Golden Mile’.
The statistics we compiled for that story are seriously out of date and yet still appear quite impressive.
At the time it had close to 200 listed companies, registering a combined market capitalisation of close to $19 billion. The resources sector dominated that list with 160 listed companies packing a market value of about $16 billion. All those numbers would now be much bigger, I’m sure.
The West Perth article and associated commentary reflected on the fact that this incredible hub had formed quite organically, in contrast to so many concerted efforts by governments to create such clusters artificially, often based on the natural success of technology centre Silicon Valley.
An artificial version in WA is Technology Park in Bentley, an admirable concept brought to life by Mal Bryce, one of the few lauded leaders of the 1980s Labor government.
Tech Park, as it is known, is a great idea but, in 20 years, has spawned very few success stories when compared to West Perth. Disgraced fuel technology company Firepower is actually one of the most successful companies to come from there – if success is measured by funds raised and headlines garnered.
Despite that dubious track record, the last Labor government unveiled big plans to give the park new life, including the creation of a new retail-focused precinct along the road shared with Curtin University of Technology.
As so often happens, the incoming conservative government has ditched those plans, which Treasurer Troy Buswell claimed were expensive and an unnecessary duplication of efforts by Curtin.
Perhaps the state is right to just let things happen naturally, driven by the local university.
In saying that, I was drawn to a recent study of the nickel industry by University of WA geographer Dr Felicity Wray, which was released by the Committee for Perth this month.
Dr Wray examined the nickel industry in WA, noting that far from just being a mining community, the sector was also contributing to the much sought after knowledge economy – where information is the key to value-adding non-physical activity.
The study notes the innovation and development driven by these firms, which are located in close proximity to each other. As it happens, the majority of these companies are based in West Perth.
“Unlike other places across the globe where state, national and regional governments have invested considerable resources and time into trying to emulate such world-class nodes in a fit of ‘silicon envy’, the paradox of Perth is that this competitive advantage has developed and grown relatively organically and autonomously,” Dr Wray concluded.
I HAD a hearty laugh during my research for this column when I found Firepower Operations still listed on the Technology Park website.
This little blurb is something that should be put in the park’s museum if they ever set one up: “Firepower Group is an international company providing effective solutions for users of liquid hydrocarbons from private motorist’s [sic] to large industrial organisations, transport companies and large-scale power generators,” it reads.
“Firepower’s technology increases performance and economy while reducing the harmful emissions that pollute the planet.”
That is gold.
Also, the website provided in the tenant listing, www.firepowergroup.com, is up for sale. And for good measure, the nominated Firepower contact is John Finnin, the former Austrade official who was jailed in August by a Victorian court for eight years (without parole) after being found guilty of sex offences against a 15-year-old boy.
I still recall the first time I encountered Firepower in early 2007 when a colleague broke the story that the company was the key Western Force sponsor behind the acquisition of Matt Giteau’s services.
All our efforts at the time to find out about the company hit dead ends, including numerous calls to this Technology Park address. The whole thing was very mysterious and the strange smell got stronger when The Sydney Morning Herald started publishing some dubious accounts due to Firepower’s links to the Sydney Kings basketball team.
We wrote a few questioning pieces that year, often wondering why our rivals, particularly The West Australian, weren’t publishing the stuff the SMH had (they have reciprocal publishing rights) or doing its own investigation.
Eventually The West got onto the story, just as Firepower collapsed, leaving lots of ripped-off creditors.
There are lots of unsubstantiated rumours about why our local daily failed to publish such a major story that has impacted on the lives, and wealth, of many Western Australians. Of course, Firepower founder Tim Johnston is big headlines these days.
In fact, some reporters from The West recently won a WA media award for their coverage of the Firepower collapse. Both of these journalists are very good at what they do, so I’d love to see them write an investigative piece on how their newspaper was so late to the Firepower party.