For and against
The federal government recently called for written submissions in response to the recommendations set out by Professor Roy Green in his Textile Clothing and Footwear (TCF) Review Report. Tracey Porter reviews the highlights.
COMPANY: Target
AUTHOR: Quality assurance manager Michael O'Connor
COMMENTS: The review recommends the formation of a TCF Innovation Capability Program with funds of $200 million. Target strongly believes most of the funds allocated to the TCFICP should be pooled and allocated so that a meaningful difference can be achieved in one category such as 'textile innovation'. For example, as Australian is relatively rich in natural resources, such as cotton and wool, we should aim to have a global competitive advantage in textile innovation. Target commends the priority given to research and development in Australian TCF firms. The development of innovative partnerships and networks with research and development facilities is critical to the development of new innovative products including technical textiles. Target also recommends the adoption of recommendations relating to the development of a new ethical quality mark. This includes labour conditions, animal welfare and environmental issues. Target strongly recommends that the introduction of such a mark would be globally aligned and not specific to Australian standards. If this was not the case, given the globalisation of the manufacturing industry, it would be meaningless.
COMPANY: VICTOR FOOTWEAR
AUTHOR: Managing director Bill Cloros
COMMENTS: Every effort should be made to ensure the administration of the [recommendations] achieve their aims in the most efficient way and that maximum benefits go to the participants who value add to the local manufacture of TCF products. On the issue pertaining to government procurement, we believe every effort should be made to buy Australian where possible. Here is a way for the government to back Australian-made and thus protect Australian jobs. Government is in the best position to appreciate the value of manufacturing to Australia as a whole. If they decide in favour of Buy Australian Made then they should legislate. We support the recommendation regarding assistance to retrenched TCF workers. Our experience with the present scheme is that the result is not accomplishing the intention. The local Centrelink office does not understand the intention of the scheme. We had one applicant knocked back because she was married.
COMPANY: Pacific Brands
AUTHOR: Spokesman Geoff Burfurd
COMMENTS: With respect to the details of Green's approach our submission to his review committee in May 2008 stressed a number of practical issues in both policy direction and implementation. His final deliberations rate poorly in terms of these practical considerations and indicate to us that confidence in the Australian clothing industry will be seriously impacted by this approach.
Whilst much of the Green report has strong application to the textile and footwear sectors of the TCF industry, it is inappropriate for clothing manufacturing and the adjustments still faced by this activity over the 2010 to 2015 period. A preferable approach is to review the adequacy of the scheduled budgetary assistance package already legislated for the clothing sector 2010 to 2015 and to utilise this framework to complete this last lap in adjustment assistance for the clothing industry.
COMPANY: L&B Williams
AUTHOR: Managing director Lloyd Williams
COMMENTS: L&B Williams welcomed the positive future outlook for the industry highlighted by the Green report. More specifically, the company fully agrees and supports the overall recommendation that a new package of assistance measures should be introduced to apply from 2009 to 2015, that covers the broader TCF manufacturing industry.
However the total funding package ($250 million) recommended falls well short of what would be needed to ensure that the full gamut of objectives embodied in the various recommendations is achieved. The industry currently receives more than double this amount under the Post-2005 SIP Scheme and even that is insufficient as clearly reflected in the high degree of modulation that has been applied to the industry grants in recent years. Moreover, Green's recommendations suggest that the proposed funding is expected to apply to a broader coverage than the existing schemes - so it is proposing less money for a greater range of activities. This clearly is not feasible if the programs are expected to be effective.
COMPANY: The Just Group
AUTHOR: Operations director Wai Tang
COMMENTS: Our view is that the current SIP arrangements and the package of complimentary proposals - in particular the Product Diversification Scheme, the OAP Scheme and the clothing supply chain proposals post-2010 - provide the certainty and confidence required to chart the difficult course facing clothing over the 2010 to 2015 period. We do not think either the approach of the Green report (ie by annual application and competitive assessment against other applications that may apply for that year), or the amount likely to apply to locally sourced clothing under the Green proposals, provides the certainty and confidence of the continued SIP and allied schemes currently legislated for clothing 2010 to 2015. In addition the removal of worthwhile clothing schemes like the priority upon product diversification in the local supply base (rather than tying local supply to known standard but diminishing basic product base) and the removal of supply chain improvement incentives for clothing firms, are all retrograde steps.
COMPANY: Draggin Jeans
AUTHOR: Owner Grant Mackintosh
COMMENTS: From our business viewpoint the uncertainty of the grants being "competitive" is a major negative and will skew the funding to the big players. Draggin Jeans does not have the spare capacity to have someone working out the intricacies and politics of another grant application and we doubt our consultant will want to punt his time on it either. So we face high consultancy fees with a possible zero funding outcome because of matters beyond our control. To business this is anathema. The Export Market Development Grant fiasco where we only received a fraction of our entitlement has highlighted the problem in our minds. A mere $50 million extra gross - maybe $34 million after tax and everyone would have been paid in full and more importantly given us confidence to continue to expand our export efforts knowing we would be supported appropriately.
Review recommendations (TO BE WRITTEN ON NOTEBOOK)
1. A new TCF Innovation Assistance Package be introduced with a budget of $250 million.
2. A new TCF Innovation System aimed at driving collaborative approaches to design, research, technology, branding and supply chain management.
3. Scheduled tariff reductions to 2015 be retained and emphasis placed on industry assistance measures.
4. The establishment of a TCF Innovation Council with funding of $12 million.
5. A new $200 million TCF innovation Capability Program (TCFICP) to supersede current assistance measures.
6. Eligibility criteria for TCFICP to include value-adding to the economy, ethical production, employee involvement and accountability.
7. Operational criteria for TCFICP to be developed by the Australian government on advice from the TCF Innovation Council.
8. More opening up of professional support and utilisation of the advisory services of Enterprise Connect.
9. The development of a new Australian ethical quality mark with a budget allocation of $8 million.
10. A new Australian national sizing standard for clothing and footwear with funding of $5 million.
11. Australian government procurement policy to encompass capability building for Australian TCF firms.
12. The TCFICP to prioritise the improvement of R&D performance, also providing an opportunity for TCF firms to access National Innovation System programs.
13. The TCFICP to prioritise targeted support to TCF firms and organisations in meeting needs for training and skills development.
14. Part 1 of TCF SAP, which provides assistance to retrenched workers in the TCF industries to continue to 2015 with a budget of $25 million. Feasibility study to be done on potential contribution of a TCF group training company.
15. Better protection for homeworkers through legislation and industrial awards.