On 27 December 2013, the Australian Jobs Act 2013 commenced, requiring major projects in Australia with a capital expenditure of $500 million or more to prepare and implement an Australian Industry Participation (AIP) Plan. It also Requires ongoing compliance reporting on the AIP plan during the project’s construction phase and two years into the operations phase.
In recent years there has been increased interest in local industry participation and local content in gas resources projects.
SEVEN STEPS TO LOCAL ENGAGEMENT
Through engagement on many major projects across a wide range of industry sectors, it is clear there are seven critical areas that a project must address in order to maximise local industry participation.
They include having:
1. The correct procurement processes in place;
2. Having knowledge of the local industry;
3. Proper communications;
4. Having correctly structured packages;
5. Making sure you select the best for the job;
6. Creating opportunities for lower-tier suppliers; and,
7. Providing access to supply chains.
For procurement processes, it is important to have a local presence, utilise local expertise and empower local decision making in order for industry to be able to engage with the procurement team.
The procurement process itself must be clearly defined and documented, agile enough to adapt to the local market’s capabilities and needs when required, and must be monitored and managed by dedicated personnel on an ongoing basis. Local industry has been assessed before the procurement processes are designed and finalised.