Advanced Manufacturing

Visual: Introduction appears with text: Advanced Manufacturing Industry Transformation Plan. Launch – 13 March 2023. www.advancedmanufacturing.nz

Visual: Paul Stocks walks up to microphone in front of audience at the Advanced Manufacturing Industry Transformation Plan launch event.

Paul Stocks

Tena katou tena katou tena katou katoa, kia ora.

Thank you Les Kendall, Chief executive of Temperzone, and thank you so much for hosting us here.

My name is Paul Stocks. I am the deputy secretary of the Ministry of Business, Innovation, and Employment, and I have the honour of being one of the co-chairs of the Advanced Manufacturing Industry Transformation Plan. Along with Rachel MacKintosh from the CTU and Brett O'Riley from EMA.

It's really good to see you here at the culmination of a 18-month journey on trying to design a path forward for the advancement of the manufacturing sector, a sector that is extraordinarily important, for New Zealand and one which has a very bright future.

It's my great pleasure to introduce the Honorable Stuart Nash the Minister for Economic Development, Minister for Forestry, and Minister for Oceans and Fisheries and Minister for Police. And MP for Hawkes Bay and as we all know Hawkes Bay along with much for our country has been struggling with the aftermath of Cyclone Gabrielle. So I'm really grateful that you can take the time to here Minister I know how busy you are.

I also just need to the flag I've worked for Min Nash for some years in my portfolio of Economic Development. He is a strong advocate for the industry transformation plans, the role that they play in New Zealand's future and economic strategy, and he's been a driving force for making sure that the government is focused on supporting industry and workers in this space.

Stuart Nash

Paul doesn't work for me. He works with me, just wanted to clarify that. As Minister of Economic Development and Regional Development it is my absolute pleasure to be here to support the launch of the advancement of the industry transformation plan.

Les, thank you very much for hosting. Amazing factory, awesome story and I'm looking forward to going for a tour of the factory. Well done, thank you very much for hosting us at the launch today.

It's great to be at one of New Zealand's leading manufacturers to see up close the potential advanced technologies in processing has for the economy, for jobs and communities.

Advanced manufacturing is vitally important. It makes up 10% of our economy and workforce, it's the second largest employer of Māori and Pasifika peoples, it is critical for both our regions and in our major cities. It's because of the sheer scale that advanced manufacturing was selected to be one of our industry transformation plans.

As the plan describes it has the untapped potential to significantly increase productivity, increase high-wage jobs in our transition to a globally competitive, low-emissions economy.

I know right now many businesses and workers are responding to the devastating impacts of the recent extreme weather events in the Government has and will continue to provide immediate relief assistance and support.

But even as we respond to these immediate challenges, we cannot lose sight of our long-term aspirations. The industry transformation plan sets out an ambitious long-term vision for the sector and proposes a near term action plan to get there. Implementing recommendations will enable us to work together through current pressures to a high wage, low emissions economy that provides economic security in both good times and bad, which is the Government's vision for our economy.

As the ITP sets out, 2 trends provide an opportunity to accelerate growth and transformation of our advanced manufacturing sector over the next 20 years. First, the sector is undergoing a fundamental shift to the application of advanced technologies and processes. Second, more focus is being placed on economic activity that is sustainable, circular and low emissions.

New Zealand's advanced manufacturing sector can adapt and thrive in this changing landscape but only if we act now to seize the opportunities. I congratulate the sector on the plan so it can prioritise recommendations for immediate action and the action plan is specific with implementation actions over 1 to 3 years that will achieve high, significant transformation and growth. The hallmark of the industry transformation plan has been partnership.

This plan has been co-developed and is co-owned by business, unions, workers, government, Maori and Pasifika peoples, and wider stakeholders. I really have been impressed with the high level of sector engagement in the development of this ITP with over 700 sector representatives engaging during the consultations. I would like to thank all those who have contributed with a through sector steering and working groups making submission or engaging in work shops.

In particular, I'd like to extend my appreciation to the tripartite steering group co-chairs, Brett O'Riley Chief Executive of the Employers and Manufacturers Association, thank you Brett during trying times and I know you are you incredibly busy. Rachel MacIntosh, Vice President of the National Council of Trade Unions and assistant National Secretary of E tu, Rachel. Thank you.

Rachel thank you as well. Huge effort and we can't do this without the input of workers. Gone are the days where we sit in the Beehive and say this is how things are going to be done and impose it. Well and truly.

And Paul Stocks, the Deputy Sec of MBIE. As you see from his title, Paul is an incredibly, incredibly busy person and vital to the economic drivers of our economy.

So Paul thank you for your time, effort and energy in turning this into an amazing plan. It's also amazing because it's something that we can implement as well.

You and the sector, steering and working, partnership groups have put in a huge amount of effort for the last 18 months. Bring to get together a large sector and demonstrating ambition and partnership principals central to the ITP program.

So once again, thank you. That partnership and the high level of sector engagement provides a strong foundation as we move towards implementing the ITP.  

Delivering on the actions of the ITP will require ongoing collaboration and commitment from all partners, and to support that just initially, I'm pleased to confirm the $30 million of government funding set aside in last year's budget that is now available for the first steps in the first stages of implementation, of certain immediate actions.

This includes $3.6 million for company advice on adopting advanced technologies and processes, $4 million to train workers to use these advanced technologies and processes and $2.9 million to support circular and low emission manufacturing. But there is a lot more to come believe me.

I'm excited and confident about the future of New Zealand's advanced manufacturing sector. Our focus as a government is on creating high-wage, low-emissions jobs through lifting productivity, growing skills, and investing in advanced technologies and innovation.  The priorities in this plan for a high-performing, advanced manufacturing, sector to align with that focus.

I congratulate the sector for creating this plan and I look forward to continuing to work together in the next critical phase of delivery.

Kia ora, Kia kaha. Thank you.

Paul Stocks

Thanks very much Minister.

There are 3 co-chairs of this advanced manufacturing ITP. It is deliberately a tripartite approach led by business, led by workers supported by Government.

So, I'd like, to what we will be doing now is having each of the co-chairs briefly talk through the 6 priority areas that are in the ITP.

I'd first like to welcome Rachel MacIntosh, the vice president of the CTU and of Et tu.

Rachel Mackintosh

Kia ora Paul

Kia ora Minister and thank you Les for your mihi, your welcome.

I also would like to acknowledge that we have our 2 Union site delegates here, kia ora  and good to see you. And we also have another Union person who's been involved in this plan, Matewai Roberts, from Sistema Plastics greetings to you.

Today is an exciting day for the possibility of transformation in advanced manufacturing.

That's moment has been more than 2 years in the making and I acknowledge the work of many people from unions, from government and the employer community in making it happen.

And I thank my co-chairs Brett and Paul as well. I also acknowledge the support and commitment of Minister Nash to this process and its future.

I also acknowledge the whole steering group and worker representatives Lavina Rickard, Ces Herring, and Edwin Ikani. It was Edwin who made the statement early on that we need to harness the creativity of workers and that statement was part of developing a vision for the future of the industry to give the plan something to aim for in the vision is this:

A thriving Aotearoa New Zealand advanced manufacturing sector of world-class creators, innovators, and makers delivering quality products, sustainable solutions and inter-generational well-being.

This vision put to focus on people and on Aotearoa as our place. The plan includes actions that will attract people to manufacturing and will enhance the skills that people will apply in the sector. When we work together, we can have a high skill, high wage sector that people are proud to work in and proud for their tamariki and mokopuna to work in as well.

The plan includes actions to ensure the environmental sustainability of the sector. To honour Papatuanuku, and transform manufacturing into a sector that provides for intergenerational well-being. For generations to come can proudly stand and proudly participate.

We will continue to collaborate, we have several stakeholder groups, including a union group, and including a Maori group, a group for Pasifika, a group for business, that will ensure that all the stakeholders voices continue to be heard as we implement the plan.

And so that we can ensure that we realize that vision of the future of the sector.

Now we just have to do it. Kia ora.

Paul Stocks

Kia ora Rachel and it's appropriate you use the word vision several times because actually the thing that Rachel really brought strongly to the table in the steering group was that vision and sense of purpose for the future and a real commitment to making it happen.

So kia ora. Thank you Rachel.

Now I'd like to welcome Brett O'Riley, CE of the EMA. Brett's been driving this since before the ITP part of the vision, part of the vision was from Brett.

Brett O’Riley

Welcome everybody, I'd like to acknowledge a few other people. The MBIE team led by Hunter Nottage, who's worked tirelessly over the last 18 months in getting us to get to this point. Thank you for your contribution.

It's actually been a lot of fun being a co-chair of an industry transformation plan. I can't always say that about projects we get involved with but I think the spirit that everyone has had having seen manufacturing recognized through the COVID-19 response is being such an important part of the sector. I think that really galvanized us all to look forward and look at what the future could look like.

I would also like to acknowledge a number of other industry groups and business leaders who have been involved on this journey for a long time.

The ITP is really part of a continuum that's been going on for many decades as we try to evolve manufacturing in New Zealand to be globally competitive, and to be able to contribute to the economy.

I'd also like to thank Minister Nash who has been a great support and not just for the ITP process but for the aspiration that we all share that this industry, this capability both horizontally and vertically across the economy can really fulfil what we all hope for New Zealand’s future.

That is to be a much higher wage economy, with much higher productivity, and globally competitive.

Priority 1 is one of the key areas of the industry transformation plan. It's about increasing investment in advanced technologies and processes which we know is that path to lift productivity and wages. We know that we need fit for purpose incentives at all levels from accelerated depreciation and investment in skills,  development and retraining, local economic development initiatives, and foreign direct investment. All of those sorts of initiatives have been implemented in other economies and we know that there that there are lots of lessons we can learn from in New Zealand.

Priority 4 is another key area that's about improving the understanding of perceptions of advanced manufacturing. I remember being interviewed during the COVID-19 response and people saying to me, does New Zealand still have a manufacturing sector? Well absolutely we do, you're not going to see many better examples of that sector than here at Temperzone, but there are also lots of other companies large and small that contribute to the industry and to New Zealand's economic prosperity in advanced manufacturing.

So we need to build on that perception. We need to get the message out to our schools, into tertiary institutions that there are really meaningful careers in the sector. And we need to have more of our ringatahi with the digital skills and understanding of these industries that they can take forward.

The partnership that we've forged through the ITP has been something quite special. And I think that's been touched on by the other speakers. But now it needs to endure and ensure that there is an ongoing commitment from all of the parties, including business, to realizing the vision of the industry transformation plan.

Because a plan without implementation, will just sit on the shelf. And we're all very committed to wanting to see this develop. The $30 million dollars of funding committed from the Government is a fantastic start but we know that it has to be a partnership from all of the parties in the ITP to make it successful.

As part of that we will be forming a new group, the Aotearoa Advanced Manufacturing Group to continue to bring together the key parties and leaders to drive the ITP, along with regional groups to ensure there is localized commitment and action, and that local contribution that has been made to the ITP through the working groups, through the regional consultation has been really important. So thank you to those of you who are involved in that.

The power of the collective is so important, across the diversity in collaboration that this industry transformation represents with our Maori and Pacific communities and with regions right throughout our country. Importantly, because this represents a horizontal capability in the economy, it's the way the advanced manufacturing ITP plan will work alongside many of the other industry transformation plans and already those discussions have taken place.

With your food basket.

And my food basket.

The people will thrive and so will advanced manufacturing.

Thank you.

Paul Stocks

Kia ora

Thanks for that Brett. I'd like to touch on the priorities in the ITP, which is about innovation and global connectiveness.

The ITP is not about today's manufacturing. It's about tomorrow's. It is about the shape of the future of the New Zealand economy and to quote Taylor Swift, if you fail to plan, you plan to fail, and this is actually about planning for the future. But one of the key things about the advanced manufacturing space is the level of R&D undertaken by firms in that sector. When we look at R&D across the broader New Zealand economy and a lot of its done and paid for by the Government, that’s not the case advanced manufacturing.

So at the moment 75% of R&D spend in the manufacturing space is done by firms for firms lifting their own capability. That innovation is going to be critical for the future of this industry and for the future of New Zealand and that’s why the fifth priority for this ITP is really boosting R&D there.

I know that Rnd that takes place in a place like Temperzone is not about research in a university. It's not about white-coated scientists, it's actual innovation that takes place on the floor. Changes processes, changes the way we do things for the better, and actually in the last year the Government announced some changes to how we fund that type of R&D.

So there is $90 million dollars over 4 years for a new R&D grant to help people move into R&D and importantly I think for advanced manufacturing there is $155 million dollars over 4 years for the Arahira Innovation Trailblazer Grant which recognizes that Innovation takes place on the floor in the work place. And not just in universities and CRIs.

Secondly, global opportunities, we are a trading nation and will always be and over our history a lot of that has been in the primary sectors. But manufacturing is a huge export industry although at the moment about 80% of that is in the primary sector, so the trick is to expand that out to have firms like Temperzone in the air-con space and the really high-end space to actually get out there and attract into markets. 

So, it's about diversifying the products that we sell, and the markets that we sell into, and manufacturing has a really diverse set of markets that it goes into - into Europe, North America and into Asia, really broadly spaced.

That's going to be really important. The commitment from Government in the space is that when we do trade missions and delegations and these are important to build connectivity to new markets when we have ministers, traveling and selling the products of New Zealand and selling the advantages that we have advanced manufacturing will be front and centre in those trade missions and in those trade delegations. We really want to push that connectivity and that market access and that market success.

I just want to finish by really celebrating the team, the broader team in advanced manufacturing. Not just the Steering Group but the hundreds of people and gave their ideas, their contributions to how we can make this a really successful industry.

There are 20 actions in the ITP, 20 specific concrete things that we collectively will move forward to do and so we're really looking forward to making that successful and thank you.

Thank you Brett.

Thank you Rachel, thank you MBIE team.

Well done.

Kia ora.