John Button and I were keynote speakers at Kevin Rudd’s Manufacturing Industry Roundtable on Monday. Though it was closed to journalists, Crikey have asked me to edit some notes I posted at Club Troppo – to air my clean linen in public before the event:

Here’s half of those notes – the second half tomorrow:

  • Why manufacturing? Why indeed. We’ll get no-where without a broad definition of manufacturing which comprehends the paths up the value chain that developed country manufactures should take – into design, brand management, software and systems integration.
  • We should focus on things that are worth doing in their own right but which also have strongly positive effects on innovation and for manufacturing – broadly considered.
  • As Lateral Economics argued in its discussion paper for the Victorian Government Regulation and Innovation, our current system of regulation review is mired in the limitations of central planning. We need a system of regulation review that drives change from the bottom up – giving firms rights to alternative compliance.
  • We should seek to become a regulatory pacesetter with the primary aim of good government, but with the secondary effect of generating opportunities for our manufacturers.
  • Our report provided an example of setting up ‘penumbral’ markets alongside Kyoto compliant carbon markets where experimental technologies could be developed. This would lower the cost of carbon abatement and place innovative Australian producers in the box seat to develop new technologies.
  • We could do something similar in other areas like pharmaceuticals.
  • Excessively strong intellectual property protection is becoming a major impediment to innovation in software. We’ve been heading in the wrong direction here owing to our kowtowing to the Americans. But we can still address the issue and comply with our FTA obligations.
  • We should also do whatever possible to protect open source software from the fear uncertainty and doubt that software patents are having. We should aim to make Australia a safe haven for the creation and distribution of software, particularly, but not exclusively open source software.
  • The Commonwealth government should insist that State Governments not seek to poach existing business off each other, and going further should prevent them competing with each other with incentives to attract foreign investment except as part of some process co-ordinated with a national approach to investment attraction.
  • Well that last point went up on Club Troppo, but didn’t make it into my time limited presentation. Of course many other points were raised in a successful and interesting day.

Of the points raised, the greatest interest was shown in a new approach to regulation. And Kevin Rudd impressed me. Genuine interest in policy is surprisingly rare amongst politicians, and lies at the heart of John Howard’s present woes. By contrast Rudd seemed as interested in good policy as any politician I’ve met.

Tomorrow: how we can manage our macro-economy to advantage manufacturers.

Peter Fray

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Peter Fray
Editor-in-chief of Crikey