Australia’s largest circulating manufacturing magazine – cab member
Industry Update Issue 71 April 2013 $12.00
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Manufacturing Magazine
SPEAKING OUT
It’s not only the strong dollar that is hurting us, say industry leaders In the previous edition of Industry Update Innovation and Industry Minister Greg Combet warned industry that it must adapt to survive these tough times. The strong Australian dollar is not going to fall anytime soon, he said. And Prime Minister Julia Gillard has echoed those sentiments. She also believes the Australian dollar will stay high for some time, but says this shouldn’t stop the nation from having a viable manufacturing sector. “We can still be a country that manufactures things. But we’re going to have to do it differently,” Ms Gillard said in a recent radio interview.
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But what does industry think? Industry Update spoke to a broad cross section of industry leaders to gauge their views. Steve Durden, Sales Manager Hercus Pty Ltd, an engineering and transmission specialist established almost a century ago, agrees the high dollar has put many manufacturers under extreme pressure. But it’s a broader range of issues – mostly Government inflicted – that is hurting most, Mr Durden says. “The cost of doing business in Australia is extremely high, he says. “Our energy prices have doubled in the past six years.” And according to Mr Durden the high
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cost of wages in Australia is also adding to industry woes. In addition, most manufacturers are now paying more in taxes. “For example there is now a flat 20 percent FBT (Fringe Benefits Tax) on the purchase price of company vehicles, Mr Durden says. “That means if you buy a $50,000 vehicle, you have to pay $10,000 a year in tax. All these things add up.” And fierce competition from “cheap labour” countries remains a huge challenge, Mr Durden says. Continued page 5
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