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Making Our Money Go the Miles: Using Procurement to Deliver Policy



Alex Cassie


Governments, when they want to use them, have two major levers to implement their agenda. One is legislation – the other is Governments spend their money. And that is what this resolution is about.


Every dollar the government spends can be leveraged to advance an agenda. Every decision government makes about how to spend money – from who gets the contract for submarines, to what type of computers are in the district court – is made with delegated authority by government.


This can be done better, and every dollar spent can go further.


This WA Labor Government already has an ambitious agenda to use its procurement to drive economic diversification through local business and industry development and particularly through green job creation, which we applaud and discuss in other resolutions.


But we all need to change our mindset about how procurement decisions are made.


There are some good and important discussions around procurement setting a minimum standard. Minimum standards of labour practices and environmental standards, and targets for First Nations partners and regional businesses. Licencing regimes and others.


But let’s aim higher than the minimum. With an approach of strategic procurement, we can establish a proactive goal - or a set of goals – we want to achieve with each procurement project.


Imagine, if you will, a world in which governments recognised that a transition away from fossil fuels was inevitable, and that the transition should be managed not only to minimise negative effects but to maximise positive outcomes. Those positive outcomes could be environmental, and regional, yes. But it could also be the development of entirely new industries. If the transition is planned, and we know how many stand-alone power storage units we are going to need over the next forty years, we could develop a strategic procurement approach to ensuring that those stand-alone power storage units provide a baseline order amount that encourages new businesses to establish in WA.


You do not have to imagine this – it’s here. Because we have a Labor government, and largely thanks to the campaigns of the mighty ASU, the power system is in public hands, and it has already developed the plan for our power future. So let’s go the next step further and use it to develop new industries.


There are six steps to making a lithium battery, from mining to installation, and we don’t have the capacity to do them all here yet. And we never will, unless local companies have some security to expand their capacity, or those that can already do it have some incentive to set up shop locally. And that security can be provided through government procurement – if we think beyond the reactive and start planning for the long-term strategic goals.


The door is open to this here in WA. We are a party and a government that still has so many levers at our disposal, because we have not sold off our state.


We can use the government’s spending power – our collective tax spending power – to build new industries.


We do not have to be afraid of this. The US has recently committed to 100% US products in their government procurement. In Germany and South Korea innovation and capacity development is a central part of procurement, creating and commercialising markets for local producers. Meanwhile the Australian governments have stripped away our industry policies and left procurement to be a matter of low cost and minimum standards.


Strategic procurement requires a shift in our thinking away from a reactive, responsive approach to a proactive one. But the door is open to it – we just need to walk through.


And then we will finally be using the second major lever that governments have, and we can bring ourselves ever closer to our most aspirational goals.


Then perhaps one day we can imagine every community in WA powered by green energy from a stand-alone system that was mined, manufactured, made and installed by workers here in Western Australia.


Alex Cassie is the Political and Community Organiser of AMWU WA. She previously worked at DFAT, including in the Office of Trade Negotiations and in US Trade Policy.