Support for local manufacturing critical for delivery of home building targets

In a bold move to bolster Australia’s domestic manufacturing sector, the Housing Industry Association (HIA) has thrown its weight behind calls for a comprehensive energy security and supply strategy. This initiative aims to support the nation’s building product manufacturing sector, which is deemed essential for both economic stability and the provision of crucial materials for home construction.

Simon Croft, HIA’s Chief Executive for Industry and Policy, emphasised the urgency of addressing the challenges faced by local manufacturers. “HIA shares the concerns raised by a number of Australian manufacturers about the escalating cost of energy and the impact it is having on Australia’s manufacturing base,” Croft stated. He highlighted that energy affordability and reliability are among the most pressing issues confronting Australian building product manufacturers and suppliers.

The residential building industry in Australia relies heavily on a robust and competitive local manufacturing sector to supply essential materials such as steel, bricks, cement, timber, and glass. Croft warned that rising energy costs ripple through the housing supply chain, affecting everyone from manufacturers and builders to homebuyers. “When energy costs rise, those impacts are felt right across the housing supply chain,” he noted.

In a recent submission to the Federal Treasury’s Economic Reform Roundtable, the HIA called for swift action to ensure energy security, reliability, and affordability. The association also advocated for reducing the growing regulatory burden on local industry. Croft stressed the need for manufacturers to have certainty and competitiveness to foster investment and growth. “Current policy settings too often pull in conflicting directions that undermine affordability and reliability,” he said.

The HIA is advocating for a fuel-source neutral approach that supports all forms of energy supply while maintaining a stable and affordable supply. Croft warned of the potential consequences if these issues are not addressed: “Without this, Australia risks losing its manufacturing capability at a time when sovereign supply chains have never been more important.”

A strong domestic manufacturing base is seen as crucial not only for Australia’s economic resilience but also for achieving the government’s ambitious housing targets. “If we are serious about meeting the 1.2 million new homes target, we must ensure that the key materials needed to build those homes can be made here in Australia competitively, sustainably and reliably,” Croft asserted.

To support manufacturers during the energy transition, the HIA has called for the establishment of a Building Product Sector Transition Strategy. This would be complemented by a coordinated federal approach to energy and regulatory reform. “A ‘Future Made in Australia’ depends on keeping our factories running and our costs competitive. The time for coordinated, practical reform is now,” Croft declared.

The call for reform comes at a time when the Australian government is under pressure to meet its housing targets while maintaining economic stability. The HIA’s stance underscores the interconnectedness of energy policy, manufacturing, and housing supply, highlighting the need for a holistic approach to industry challenges.

As the nation grapples with these complex issues, the HIA’s advocacy for a strategic energy plan signals a critical step towards ensuring that Australia’s manufacturing sector can thrive in a competitive global market. By addressing energy costs and regulatory burdens, the HIA hopes to safeguard the future of local manufacturing and, by extension, the nation’s housing industry.

Industry stakeholders and policymakers will be closely watching the government’s response to these calls for reform, as the outcomes will have far-reaching implications for Australia’s economic landscape and its ability to meet future housing demands.