THERE is strong support to strengthen the powers of an independent government body charged with maximising local involvement in public projects.
The State Government claims the proportion of contracts awarded to local companies has increased from 65 per cent to almost 80 per cent since former PIRSA boss Ian Nightingale was appointed as SA’s inaugural Industry Participation Advocate in February 2013.
It now plans to introduce an Industry Advocate Bill in Parliament midyear following a consultation phase that closed on March 31. If passed, it will strengthen powers to hold contractors to account over the utilisation of SA workers or materials.
Assistant Minister to the Treasurer Chris Picton said “extremely positive” feedback received during consultation proved that industry was “united in its support” for the legislation.
“Our Bill will enshrine the position into law and give the Advocate new powers to make sure we get the best economic benefit from our state’s record public infrastructure program,” he said.
More than 90 per cent of the total spend on major infrastructure initiatives is going to SA contractors, the government claims.
To this point of the $896 million Torrens to Torrens project — jointly funded by the state and federal governments — 89 per cent of labour costs have gone to SA residents, with 96 per cent of subcontracts awarded to SA businesses.
Mr Nightingale said government expenditure can provide a big boost for businesses and the community through the flow-on benefits of jobs and additional economic activity.
Since his role was created, the government claims the annual economic benefit to SA has exceeded $230 million.
Industry organisations to have thrown their support behind the proposed Bill include the Steel Institute, Civil Contractors Federation, and Subcontractors Association.
CCF chief executive Phil Sutherland said the establishment of a statutory authority to ensure compliance, will provide the “teeth necessary for the Industry Participation Policy to achieve true social and economic benefits for SA”.
For expenditure above $33,000, the IPP specifies that government must determine if a SA business can deliver the product or service. It also places a 15 per cent weighting on the utilisation of SA labour and materials and ensures at least one SA business quotes for work.
Mr Picton has previously said that the Bill will be accompanied by an updated IPP, lowering the threshold at which tenderers must demonstrate how they will contribute to local investment and jobs.
Soon after Mr Nightingale was appointed, the Opposition expressed scepticism about his role.
But yesterday, Opposition treasury spokesman Rob Lucas said a number of stakeholders have since expressed support of the role.
“We will take those views into consideration when we consider the legislation. We have issued no policy at this stage on the role of the Advocate,” he said.
“Our decision on the legislation will then be part of our procurement policy for the 2018 election.”
The Australian Subcontractors Association’s Paul Williams said his organisation’s member are now seeing greater opportunities.
“The proposed legislation would give the Industry Advocate greater powers to go into bat for these businesses,” he said.
Originally published as Local benefits set to be boosted