The next step for industry growth centres – by Paul Hodgson

A secret report into the future of industry growth centres has pointed to design weaknesses in the growth centre model and inadequate funding to affect outcomes at a sectoral level. With the federal government believed to favour abolishing the centres, Paul Hodgson points the way ahead.

I recently finished up a busy and impactful three and a half years with NERA, one of the Australian government’s industry growth centres. It has been disappointing but unsurprising to hear of their expected demise in recent weeks.

Australia has had a difficult history with answering the question of ‘what do we want to be famous for?’.

In the past two decades alone, we have had Industry Action Agendas, Industry Innovation Councils, Enterprise Connect Innovation Centres, Industry Innovation Precincts, Innovation Partnerships and more recently Industry Growth Centres.

Why do we bother? I think we bother because we are still in transition from a manufacturing and service economy that focused on products and services for our own middle-sized domestic economy to one in which globalisation simultaneously opened up global markets but demanded a higher level of competitive advantage. We have lost businesses and industries that weren’t up to the task.

For a country of 25 million people out of a global population of 7.5 billion and rising, we can afford to focus and specialise on our strengths for a world market.

While we have amazing research, technologies and businesses winning and impressing in global markets, we rarely turn these individual efforts into successful Australian clusters, supply chains and industries.

It is hard to pinpoint why we can’t stick with a goal for the long-term in industry policy.

Is it because, as the world’s 12th largest economy, we seem to be able to generate sufficient employment and revenue for our local market?

From the Asian Financial Crisis to the GFC to the Covid-19 pandemic, our economy has shown remarkable resilience, perhaps due to our commodity exports and astute and timely fiscal stimulus. In the words of Jim Collins, perhaps ‘good is the enemy of great’.

The good news is that Australia has a combination of remarkable natural advantages, research strengths, infrastructure, talent and enterprise capability in a number of global industries and growing market opportunities.

However, as a wise friend once told me ‘if you don’t know where you’re going, any bus will get you there’.

So what next for industry growth centres?

My advice would be to re-affirm what Australia wants to be famous for by bringing together the priority industry sectors, priority manufacturing sectors, Austrade’s Sector Centres of Excellence and CSIRO’s missions into a ten year national ‘whole of nine Australian Governments’ agenda with ten years of funding and the alignment of key supporting agencies, programs and initiatives.

If we want to be the world’s best at anything, we will need significant investment, market intelligence and access, skills and capability, research, technology transfer, innovation and commercialisation, regulatory reform, regional clusters and any number of other supporting efforts.

The myriad initiatives we have now need to be better focussed and coordinated around enterprise-level and industry-level growth plans.

Paul Hodgson has over 20 years’ experience as an executive leader in the public, private and not-for-profit sectors. He has worked as a consultant for PWC, for the Ipswich council in an economic development role, advised federal and Queensland industry ministers, and was a general manager at the energy industry growth centre, National Energy Resources Australia, where he led the development of NERA’s National Hydrogen Technology Cluster Network.

Picture: Paul Hodgson

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