An indispensable part of ecosystem

Denham Sadler
National Affairs Editor

Advanced manufacturing has turned a corner in Australia and is an “indispensable part” of the innovation ecosystem, federal industry, innovation and science minister Arthur Sinodinos said.

Speaking at the 2017 National Manufacturing Summit at Parliament House on Wednesday, Mr Sinodinos said the manufacturing industry has bounced back following its decline during the Global Financial Crisis and now has a lucrative future in Australia.

He said the sector will be a key focus in his innovation portfolio.

Arthur Sinodinos: We need ‘an innovative mindset and a global outlook’

“We see manufacturing as an indispensable part of the innovation ecosystem that we are trying to build in this country,” Mr Sinodinos told the conference.

“The future is very much in innovative and smart manufacturing. Which means that we have both an innovation mindset and a global outlook, to help to give us scale,” he said.

The defence industry holds many big opportunities for advanced manufacturing in Australia, Mr Sinodinos said.

“We have to capitalise on the $195 billion Defence Industry Plan that is coming at us. There will be great spin-off benefits across the rest of the country and my involvement with defence industry on this is to maximise those spin-offs and make sure we get the most benefits out of that,” he said.

“It is a huge opportunity. We have got a Centre for Defence Industry Capability whose job is to help local companies assess themselves in relation to their capacity to supply defence needs, and how we can help them to become fit for purpose, that is going to be very important.”

The Centre for Future Work at the Australia Institute produced a report on manufacturing to coincide with the summit, finding that the industry is “poised for a recovery” and has enormous innovation potential.

“No sector of the economy invests more, relative to its output, in new research and experimental development than manufacturing. Manufacturing is inherently more reliant on innovation activity, in both product and processes,” the report said.

“A strong, healthy manufacturing sector is a prerequisite for successful, economy-wide innovation. The Internet of Things and so-called ‘Industry 4.0’ technologies will also open new opportunities for innovation-intensive manufacturing, by reducing the relative importance of production costs and further expanding scope for customised, niche production.”

Mr Sinodinos said the report highlights the potential of advanced manufacturing in the future.

“Manufacturing is turning the corner – it’s turning the corner in a smart, advanced way. There’s a future for this. It’s an indispensible part of the innovation ecosystem as we go forward and I am very keen to see all of that,” he said.

The government’s movements in the advanced manufacturing space will focus on helping companies and employees transition to new technologies.

This year’s budget saw $47.5 million invested in the Advanced Manufacturing Growth Fund, which will provide matched grants to South Australian and Victorian manufacturers for “innovative processes and equipment.

It has also committed $10 million to create innovation labs in the two states that will act as test and business capability development centres for advanced manufacturing.

“We can’t hold back the tide of change – we have to adopt, we all know that. That’s why the government has put in place programs to help the adjustment of firms in the sector and importantly employees in the sector. Increasingly government programs are being reoriented to promote the transition and to promote in particular us getting smarter in how we do things.” Mr Sinodinos said.

He also hinted at the government’s plans to foster collaboration in the space to help solve the country’s traditional problems in commercialising research.

“One of the things about this country is we really punch above our weight when it comes to knowledge creation. One of the challenges we face is how we translate that into more commercial outcomes,” Mr Sinodinos said.

“That doesn’t mean we have to commercialise every idea in Australia, but my point is we have a great opportunity for greater collaboration and one of the sectors in which collaboration is really important going forward is manufacturing.”

The government is currently investigating the establishment of a “universities precinct strategy”, which he said would be a way of “turbocharging collaboration” in the sector.

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