DEFENCE
COVID-19, Sovereign capability and a trans-Tasman single market The Defence Industry Advisory Council’s Greg Lowe presented at the July NZDIA Member Meeting on supply chain resilience and linking NZ and Australian defence industries via the Australia New Zealand Leadership Forum.
Greg Lowe ONZM is Group Chief Executive of Beca and New Zealand co-chair of the Australia New Zealand Leadership Forum, having spent his early career in the Royal New Zealand Navy as a Commander and director of marine engineering.
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COVID-19 and Sovereign capability The Defence Industry Advisory Council (DIAC) has been focused on working with the Ministry of Defence post the review Optimising New Zealand Industry involvement in the New Zealand Defence Sector. A key conclusion of that report, says Mr Lowe “ was that maximising support that’s available in the country is likely to be a more cost-effective outcome provided that the value and the quality of services and products meets the standard.” Changes to procurement policy flowing from the report’s recommendations include the requirement on overseas bidders to submit a New Zealand Industry Engagement Plan. “Recently, the Ministry has strengthened that requirement for international bidders to demonstrate how they are providing value to the New Zealand economy through their engagement with New Zealand industry,” he added. During the COVID-19 crisis, the minister reached out to the DIAC to initiate a discussion on the impact of COVID on the New Zealand defence industry. According to Mr Lowe, understanding the impact of the COVID crisis on the defence industry is a multifaceted discussion. “So to assist that, the Ministry recently commissioned a survey of a number of industries, which was conducted by Martin Jenkins,” he said. “They’ve put their initial report back to the Ministry of Defence, resulting in recommendations to the Minister.”
“The salient point that comes through all of that is a discussion that’s happening in New Zealand and in Australia around what’s termed ‘sovereign capability’. Both countries are using the same language, and they’re essentially asking that as a result of this crisis, what has been the impact of the disruption of supply chains and how has that impacted the ability of defence to do its business. “Given that defence is expected to operate in times of crisis, the disruption of supply chains to defense activity is not a new subject, of course. So the question that’s being asked is, is there enough sovereign capability in New Zealand and in Australia.” “The question that the minister, the government, the ministry and the Defence Force is asking is what is the nature of the relationship between the local supply chain and the international supply chain, and is that strong enough? I think the answer to that is going to be it needs to be stronger and so the recommendations that are going to go back to the minister are about how we might strengthen that supply chain.” According to Mr Lowe, the Secretary of Defence is holding a workshop with DIAC in September to begin this conversation around a potential program of work that strengthens the relationships New Zealand organisations have with international suppliers. “What we would expect is that in that procurement activity, as we go Line of Defence
