FEDERAL BUDGET 2011: Buy Australian scheme to give SME suppliers access to resource projects

The Government will spend $34.4 million over the next four years to promote a new Buy Australian program that will see large resources companies linked with smaller, local supply firms.

The program, launched by innovation minister Kim Carr, will see business advisers work with smaller businesses to help them become more integrated with the resource sector in order to reverse what the Government sees as the favourtism established industry players.

Part of the program will be run through the existing Enterprise Connect system, which many SMEs already take part in – the program provides support and assistance to SMEs, including advice on grants and business reviews.

“Major resources projects provide significant opportunities for Australian suppliers,” Carr said in a statement.

“Unfortunately, some suppliers are missing out because of established global vendor lists and the trend towards pre-assembled modules.”

Initial funding of $5.1 million will be provided during 2011-12, followed by $9.5 million in 2012-13, $10.1 million in 2013-14 and $9.8 million in 2014-15.

The new Enterprise Connect Business Advisors will work with staff the Government calls “Supplier Advocates” to connect companies with buyers.

The Government says it will educate these suppliers about “the strength of the local manufacturing and service sectors”.

The initiative comes as the manufacturing industry continues to struggle. The sector has contracted for the past several months, according to data from the Australian Industry Group, and many companies are struggling with the high Australian dollar.

Managed by the Industry Capability Network, the advisers will work alongside projects including the Woodside Browse development, the INPEX Icthys project and various gas projects underway in Queensland.

The department says $12.1 million of the total funding will be used to fund the Supplier Advocates Program – an additional four supplier advocates will target sectors where “opportunities are identified”.

Meanwhile, a further $15.5 million will be awarded to the Enterprise Connect program over the next four years to recruit 11 more advisers, and increase the number of grants and development projects. These advisers will work directly with SMEs.

A further $4.4 million will be used over the next four years to expand the Supplier Access program, with an industry specialist to be added to major resource projects procurement teams to ensure local suppliers are given a voice. Another $2.5 million will be used for a Resources Sector forum.

Along with this forum a Supplier Envoy will be appointed, whose role will be to “champion Australian industry participation in the resources sector”.

The forum will contain representatives from resources companies, unions, manufacturing and technology firms and will be designed to maximise the participation of small business.

“The Government’s new initiative will help support and sustain the resources boom – and lock in the benefits for Australian workers for decades to come,” Carr says.