The ‘missing link’ of the economy wants support

The “missing link” in the economy deserves a boost in the next federal budget, according to a leading body.

Particularly in the manufacturing and finance sectors, seed funding to develop medium and large enterprises could generate economic and social gains, the Cooperative and Mutual Business Council said on Monday.

“People and businesses have moved to the regions as a result of the pandemic,” BCCM chief executive Melina Morrison said.

“It will be important to lock in this value for the benefit of regions where growth is taking place.”

Community-owned businesses could also be the answer to supply chain challenges posed by the pandemic, she said.

The co-operative model is an alternative economic development strategy that is underutilized in Australia, according to budget discourse from a well-funded ‘Thriving Regions’ program.

Australia could aspire to Germany’s medium-sized business sector, the “Mittelstand”, or an Australian version of the thriving cooperative business clusters in Emilia-Romagna in Italy or the Basque region in Spain.

The HunterNet Co-op, a small and medium-sized industry group, has played an important role in Newcastle’s manufacturing base and could be a model for regional Australia, the peak body said.

The co-op structure is the “secret sauce” with members enjoying access to group training, networking, advocacy support and joint bidding on contracts that are too big for any one company.

“Bridging the missing link in Australian manufacturing can be achieved through co-operatives,” Ms Morrison said.

Since its formation at the time of BHP’s departure from Newcastle and significant economic upheaval, HunterNet now represents 200 member companies with a total of 70,000 workers in the manufacturing, engineering and defense sectors.

The network has a combined revenue of over A$80 billion.

Another example in the budget presentation is a cooperative formed on the Fleurieu Peninsula in South Australia to reopen a mothballed local slaughterhouse.

Unlike traditional agricultural cooperatives, the cooperative will be jointly owned by workers, wholesale and retail customers and primary producers.

The cooperative is seeking to raise $1.2 million from its members by using the so-called cooperative capital units to reopen the slaughterhouse and create a “paddock to plate” brand.

More regional cooperatives can generate private investment with access to the right technical support and business advice, according to the peak body.

The government’s goal of a $100 billion agricultural sector by 2030 would also be more achievable with a thriving cooperative sector and its “multiplier effect” in the regions, according to the brief.

The industry-leading body represents more than 11 million individual members, including 60,000 companies.

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