News Review: AIDN reveals industry survey results, calls for SME Ombudsman | ADM Dec 2010/Jan 2011
Federal President of the Australian Industry Defence Network Graham Priestnall has released the results of the 2010 Defence Industry Survey of 800 AIDN members throughout Australia, conducted with Logie-Smith Lanyon Lawyers.
The respondents represented a cross section of the diverse AIDN membership.
The five most time-consuming matters for the respondents in negotiating contracts with Defence were (in descending order): schedule and delay, price, variations and change control, intellectual property, (equally) acceptance testing and financial capacity and guarantees.
The five most time-consuming matters for the respondents in negotiating contracts with prime contractors were (in descending order): price, schedule and delay, variations and change control, warranties and defects, and limitation of liability.
The five most time-consuming matters for the respondents in negotiating contracts with subcontractors were (in descending order): price, schedule and delay, warranties and defects, variations and change control, and acceptance testing.
47.6 per cent of respondents felt that the time and money spent tendering and negotiating contracts with Defence represented value for money to their organisation.
41 per cent of respondents felt the ASDEFCON suite of documents were not user friendly, and were difficult to understand.
Once again, the findings revealed that nearly 30 per cent of the respondents admitted to having no knowledge of the ASDEFCON suite of documents at all.
And nearly 30 per cent of respondents admitted to having no knowledge of the Defence Procurement Policy Manual.
“Despite the Australian Government forecasting a higher level of defence spending in the Defence White Paper 2009 and Defence Capability Plan, Australian SMEs are experiencing a significant reduction in defence work,” stated Priestnall.
“This reduction is caused by various factors including: the delay in defence project schedules, the impact of the Strategic Reform Program on sustainment and direct purchasing of Military Off The Shelf solutions from overseas.
“Defence risks losing access to a defence-ready industry capability that may not return when the forecast spending becomes reality, he warned.
“We need strategic resourcing programs that bring industrial regional benefits including investment in local industry, continuity of strategic skills and Australian sovereignty of capability.
“Government needs to strengthen its Australian Industry Capability (AIC) program by mandating SME participation with measurable KPIs.”
In October, then acting Federal president Mark Smith warned that SMEs are finding it very hard to remain in the industry and said AIDN believes that current Commonwealth procurement procedures discriminate against the success of vibrant SME, in the defence and national security industries.
Pointing to the support that other countries offer their SMEs, AIDN called for a strengthened SME participation plan for defence projects and the appointment of an SME Ombudsman within the Commonwealth government to represent the industries of SMEs.