Page 37 - Australian Defence Magazine - July 2018

For the primes who are part of the GSC program, there are a number of benefits. They’re only obliged to give Australian firms the opportunity to compete for work and they must win it on merit. Unlike traditional offsets programs, this doesn’t drive up prices.
The primes can also gain access to new technology which gives them a commercial advantage in their home market as well as Australia. And by participating in GSC, they signal their commitment to Australia and its industry, not a trivial matter con- sidering how much Australia is planning to spend on new equipment.
Over its eight years of life, GSC has evolved and will certainly evolve further.
Following a review in 2014, prime-to- prime GSC contracts (for example, from overseas parent to the Australian subsid- iary) were barred. Though they still pro- duced an economic benefit for Australia,
they were deemed not in the spirit of the program which was intended to benefit Australian based SMEs.
At the same time, return on investment – for each dollar spent, how much is re- turned – was dropped as the sole metric of GSC achievement. That was on grounds that it’s an imperfect measure when it could take a SME five years to go from proof of concept to substantial contracts with a defence prime.
As well, the benefit goes far wider than just the company winning the GSC contract. That flows on to their sup- pliers of everything from packaging to IT services.
Garth says of the 165 SMEs and institu- tions with GSC contracts, there could be hundreds more receiving a benefit.
“We need to be careful that we drive be- haviours that actually are in the best inter- est of Australian industry,” he said.
International engagement
GSC certainly isn’t on its own in promot- ing Australian defence industry on the international stage. There’s Team Defence Australia, which facilitates representatives of Australian firms attending internation- al defence trade shows, organised by the Australian Defence Export Office, CDIC and Austrade.
For example, 48 Australian firms were to attend Eurosatory in Paris in June. That included SMEs and Thales, displaying one if its Australian-made Bushmaster infantry transport vehicles. The visit to Eurosatory included trade missions to BAE, Thales and Rheinmetall.
“It comes back to leveraging the prime’s involvement in their strategic markets over- seas and assisting those companies in team defence Australia, opening doors and maxi- mising support and advocacy overseas,” Peel said.
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