Defence snubs SA-made Rossi boots in favour of imports for Defence workers

20 hours ago July 14, 2014 4:13PM

ADELAIDE footwear company Rossi Boots has been rejected for a lucrative Defence Department contract — and instead, Australian soldiers will wear boots made in Indonesia.

The contract to manufacture about 100,000 pairs of non-combat boots, worth up to $15 million over five years, would have secured the company’s future, Rossi Boots chief executive Neville Hayward said.

“What we are looking for, for a start is a fair go,” he said.

“We manufacture here, we base our business here, we pay our taxes and comply with all the requirements of employing staff and conducting a business.”

The rejected bid has led Independent Senator Nick Xenophon to urge the Defence Materiel Organisation to reopen the tender process.

My Hayward, who has travelled to Canberra and will today make a last-ditch plea to the Federal Government to reconsider their decision, said the knock-back was another blow to manufacturing in Australia.

“It is such a big concern because manufacturing in Australia is challenging and we are finding all sorts of pressures on our business and our sales from products coming from all over the world.”

“When we look at the current situation, many companies closing across Australia, that is now another missed opportunity for adding jobs to a company like ours.”

Rossi Boots supplied boots to soldiers in World War I and World War II. It is still owned by the Rossiter family, who established the business in South Australia in 1910.

It is one of the last remaining Australian-based boot makers where the entire boot — sole and upper — is manufactured in Australia.

Mr Hayward said Defence had told the company that their tender met compliance, but there was a technical issue which meant they “were technically noncompliant at this point in time”.

“They said they had considered that we would cover that off as we had said in the tender,” said Mr Hayward.

“So that didn’t impact on the awarding of the contract. At the end of the day they largely said it was a value-for-money situation.”

A spokesman for Defence Minister David Johnston confirmed the fawn safety boot will be manufactured overseas.

The fawn boot is being supplied by Blue Steel Boots, which will manufacture them in Indonesia, the spokesman said.

“Rossiter’s was not successful for the fawn safety boot as their price was more expensive than the successful bidder,” he said.

The tender was for three types of non-combat safety boots — a fireman’s safety boot, a fawn safety boot and black safety boot — and would be worn by Australian Defence Force personnel.

Mr Johnston’s spokesman said the contract for the black boot, which will be awarded along with a third part of the contract for fire safety boots, was still being finalised.

He said the previous supplier of the black boot was Lymington Pacific, which manufactured the boots in China.

“On 9 July Rossiter was briefed that they were also not successful for the offer on the black safety boots because of value for money considerations,” he said.

“Contract negotiations for the fireman’s safety boot requirement is still ongoing. It is currently Defence’s intention to satisfy both the fireman’s boot and black boot requirement under one contract.”

The spokesman said the Government is examining the procurement issue as part of a White Paper process.

“Government seeks to maximise local manufacturing where it represents value for money, and the awarding in 2013 of the ADF dress boot contract to iconic Australian footwear manufacturer RM Williams is a good example,” he said.

Senator Xenophon, along with Victorian DLP Senator John Madigan, is also calling for an overhaul of federal government procurement rules involving Australian manufacturers.

In Canberra today, DLP Senator John Madigan said purchases of foreign goods don’t contribute to the economy.

“The Government needs to understand our job is to enhance Australian lives first and foremost. Not to make it tougher,” he said.

“The so-called level playing field is an enigma.”

Senator Xenophon said the issue of manufacturing in Australia is “bigger than the carbon tax”.

“The Government keeps going on about how the carbon tax affects Aussie jobs,” he said.

“When we spend Australian taxpayer money, in the billions on exporting jobs overseas while overseas companies expand, (and) Australian companies shrink, that is a huge issue.”

A spokesman for the Defence Minister said: “Defence is committed to supporting Australian local manufacturing, but not at any price.”

Senator Xenophon said the Federal Government was shafting local manufacturers and Australian jobs.

“Incredibly, the DMO (Defence Materiel Organisation) under current Government rules is precluded from considering the massive multiplier effect to the local economy of having these boots made in Australia,” he said.

Senator Xenophon is expected to ask Mr Johnston in the Senate why procurement processes won’t take into account a “world-class locally made product”.

“What we are doing is using taxpayers’ money to export jobs overseas,” he said.

Mr Hayward said the extra work would have created 10 jobs at the manufacturing centre on Sir Donald Bradman Drive. The company employs 75 people.

“It would have underpinned the manufactured business for the next five years,” he said.

In relation to government processes, Mr Hayward he would like to bid for contracts on an even playing field.

He said the State Government should also examine its procurement processes to give SA companies a good chance of securing potential manufacturing work.

State Defence Industries Minister Martin Hamilton-Smith said the SA Government works hard to ensure local companies get a fair go.

“Last year the Government did create an industry advocate, “ he said. “His charter is to optimise the opportunities for SA companies to seize the $3.5 billion in state government contracts available each year.”

Some Rossi staff are third or fourth generation workers and many have worked for the company for more than 20 years.

Machinist Sandy Couzner, who repairs boots, including hand-stitching, has worked at the business for 34 years.

“It is important the Government support businesses like Rossi because it’s the only Australian-made boot factory and it’s been going for over 100 years,” she said.

Mark Wallace, 51, is the third generation of his family to work at Rossi and has been with the business for 30 years.

“If you buy an imported boot, you can’t get it fixed. Here you can get it fixed in a week or so,” he said.

“If I lose my job, who is going to employ me? It’s a dying industry the way it’s going. it would be hard to find new work,” he said.

Senators Madigan and Xenophon established a senate inquiry into government procurement, which is due to report its findings later this week.