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Steel plea rejected

THE Australian steel fabrication industry’s plea for industry participation plans to reduce the impact of cheap imports has been rejected by Federal Industry Science and Resources Minister Nick Minchin.

Senator Minchin said inter-national trade obligations with the World Trade Organisation pre-vented governments at Common-wealth, State and Territory level from compelling developers to employ minium levels of Australian participation.

However, the issue of maximising local content in major projects was a priority for the Federal Government and a February meeting of Common-wealth, State and Territory Ministers agreed to adopt a nationally consistent approach to the issue.

Senator Minchin was com-menting on last week’s report in Business News about the Australian Institute of Steel Construction (AISC) and the Steel Institute of Australia’s campaign to preserve local content in major construction projects.

He stressed that Federal Gov-ernment action was directed toward identifying and rectifying impediments to local content.

Endeavours to increase local participation were made through the State/Territory Industrial Supplies Offices (ISOs) which collected and disseminated information on industry cap-abilities and the Supplier Access to Major Projects (SAMP) Program which assisted project developers to identify suitable suppliers of goods and services.

A major problem in WA, where thousands of industry jobs have been lost and many fabrication shops have either closed or drastically down-sized, has been a lack of resource projects.

Billions of dollars worth of projects are in the pipeline, but there are doubts whether they will result in work for local business.

Major projects include the $1 billion West Angelas iron ore mine, the $600 million Syntroleum Burrup Peninsula gas to liquid project, the $1.7 billion Kingstream iron and steel project and Alcoa’s $860 million Wagerup refinery expansion.

According to AISC and the state’s major employer group, the Chamber of Commerce and Industry, industry participation plans will ensure WA businesses benefit from the resource boom.

AISC’s local content policy reform proposal sent to government and shadow ministers this week says current policy is reactive rather than pro-active in that it reports on why good and services have been sourced overseas after the event.

“Some $81 million worth of modular fabrication work each year would be transported by over-dimension road movements.”

– Bill Sashegyi

It demands that project developers prepare an industry development plan showing how they will create a fair opportunity for industry to compete, how contractors should interact with local suppliers and the level of support sought from Australian industry during a project’s life.

CCI has also spearheaded a campaign for high wide load road corridors to accommodate the global trend towards the more cost-efficient use of large pre-assembled modular fabrication technology.

It had a breakthrough on Monday when Transport Minister Murray Criddle announced that $14.5 million had been allocated towards the road upgrades.

Mr Criddle said pending consultation with industry and local government, the route between Kewdale and Jervoise Bay was likely to be the first high wide load corridor established.

CCI manager of industry and policy services Bill Sashegyi said a network of the road upgrades would link metropolitan fabrication centres with regional resource centres in the Goldfields, the South West and North West.

This infrastructure would cost around $40 million, but it would help protect 2,000 jobs in the steel fabrication industry.

“If acceptable routes are not available to allow local fabricators to compete for this work, these modules will most likely be fabricated overseas, off-loaded at regional ports and transported to the project site, bypassing the transport impediments facing local fabricators,” he said.

“It has conservatively been predicted that if suitable corridors are available, some $81 million worth of modular fabrication work each year would be transported by over-dimension road movements, with consequent savings to resource projects estimated to be $27 million per annum.”

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