10/02/2011 - 00:00

State wrong-footed on Quickstep

10/02/2011 - 00:00


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Recent controversy over a successful technology company highlights the need for a coherent industry policy in WA.

MOST people in Western Australia have never heard of Quickstep Holdings, but it suddenly made the news earlier this month when it announced plans to shift its operations from Perth to Sydney.

With NSW Premier Kristina Kenneally and Defence Materiel Minister Jason Clare in tow, the company said it had agreed to establish a large-scale manufacturing operation at Bankstown, which could create up to 400 jobs.

The trigger for the move was the signing of a long-term agreement to manufacture parts for the international F-35 Joint Strike Fighter program.

Chief executive Philippe Odouard said Sydney held several attractions.

It has secured a lease over Boeing’s former manufacturing site, which the company said offers the scale, resources and utilities necessary to undertake large scale aerospace and defence manufacturing.

Another factor was the ability to access an existing workforce with the specialist skill sets required to deliver such a large scale defence program, together with access to a large network of suppliers located on the east coast.

Quickstep said it anticipated becoming the largest independent aerospace composites manufacturer in Australia, and was actively seeking further manufacturing contracts.

In addition, the company said the move would include the transfer of R&D programs relating to its proprietary composites manufacturing technology, which it anticipated would form a key component of its future licensing and export capabilities.

For the company and for Australia, it was a rare good news story from the shrinking manufacturing sector.

But for WA, it was a deeply disappointing loss that seemed once again to highlight our status as a mining and petroleum state, and not much more.

The most controversial aspect of its move was the financial support offered by the Australian and NSW governments.

Quickstep said the NSW government had provided “substantial incentives” and “invaluable assistance” but did not provide details.

The Australian government was more explicit, with the defence materiel minister seemingly boasting that $10 million in assistance from Canberra “had helped lure Quickstep to Bankstown”.

Mr Clare said the move was likely to inject more than half a billion dollars and lead to the creation of up to 400 jobs.

When WA Business News sought a response from the WA government, we approached newly appointed Science and Innovation Minister John Day.

His office told us the relevant person was newly appointed Commerce Minister Simon O’Brien, who responded two days later with comments that focused on the politics but failed to address any of the policy issues.

“Questions need to be asked of WA-based Defence Minister Stephen Smith as to whether he supported this poaching of WA jobs to NSW by his own government,” Mr O’Brien thundered in his media statement.

“This is nothing more than a NSW state election pork-barrelling exercise using federal taxpayers’ money to try and buy votes in NSW on the eve of its state election.”

Mr O’Brien noted that the state government had been engaged in ongoing discussions with Quickstep about its WA operations and there was no record of threats to move to a different state.

There was also no mention of any policy initiatives or plans that the WA government might be considering.

The body that has been charged with advising the government in this area is the Technology and Industry Advisory Council.

However, the history of TIAC says a lot about how little focus there is on industry policy.

Historically the state government had both TIAC and the Science Council, but for the past few years there have been multiple proposals to abolish one, merge both or create something new.

Last December, then science and innovation minister Bill Marmion announced new members for TIAC, which has taken over the functions of the Science Council, giving it the capacity to advise on policies across the spectrum of science, technology, academia and industry.

In other words, all the factors that sway a company like Quickstep.

Joining a bidding war with other states is not the way to compete in this field, but what the state does need is some strategic thinking about where we want to be positioned and how we can maximise opportunities.


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