Confidential - Thales Protected Mobility Vehicles

The economic impacts of the 

BUSHRANGER Project 

The economic contribution of the BUSHRANGER 

Protected Mobility Vehicle Project to Australia, 

Victoria and Bendigo 

Based on information correct as at 4 August 2009 

Final report prepared for Thales Australia 

October 2009

Reliance and Disclaimer 

The professional analysis and advice in this report has been prepared by ACIL Tasman for the exclusive use of the 

party or parties to whom it is addressed (the addressee) and for the purposes specified in it. This report is supplied 

in good faith and reflects the knowledge, expertise and experience of the consultants involved. The report must not 

be published, quoted or disseminated to any other party without ACIL Tasman‘s prior written consent. ACIL 

Tasman accepts no responsibility whatsoever for any loss occasioned by any person acting or refraining from action 

as a result of reliance on the report, other than the addressee. 

In conducting the analysis in this report ACIL Tasman has endeavoured to use what it considers is the best 

information available at the date of publication, including information supplied by the addressee. Unless stated 

otherwise, ACIL Tasman does not warrant the accuracy of any forecast or prediction in the report. Although ACIL 

Tasman exercises reasonable care when making forecasts or predictions, factors in the process, such as future market 

behaviour, are inherently uncertain and cannot be forecast or predicted reliably. 

ACIL Tasman shall not be liable in respect of any claim arising out of the failure of a client investment to perform to 

the advantage of the client or to the advantage of the client to the degree suggested or assumed in any advice or 

forecast given by ACIL Tasman. 

ACIL Tasman Pty Ltd 

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Darwin 

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GPO Box 908 

Darwin NT 0801 

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Email darwin@aciltasman.com.au 

For information on this report 

Please contact: 

Denise Ironfield 

Telephone (02) 6103 8200 

Mobile 0419 249 621 

Email d.ironfield@aciltasman.com.au 

Brisbane 

Level 15, 127 Creek Street 

Brisbane QLD 4000 

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Brisbane QLD 4001 

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Perth 

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Canberra 

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Email canberra@aciltasman.com.au 

Sydney 

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Telephone (+61 2) 9389 7842 

Facsimile (+61 2) 8080 8142 

Email sydney@aciltasman.com.au 

Contributing team members: 

Guy Jakeman Dr Peter Johnson 

Rowena Hodges Denise Ironfield

The economic impacts of the BUSHRANGER Project 

Executive summary 

Project BUSHRANGER has been a flagship project for Thales Australia for 

two decades. The Bushmaster vehicle, contracted for supply under Project 

BUSHRANGER, has proven its worth around the world in military and 

civilian roles, with different variations of the basic Bushmaster platform being 

used by Australian and international defence forces, as well as Forestry South 

Australia. In total, more than 900 Bushmaster vehicles (and variants) are 

expected to have been produced by the end of 2011. 

In 2008 the Australian Government launched an acquisition programme to 

replace the Army‘s current fleet of light vehicles with a Protected Mobility 

Vehicle – Light (PMV-L) category of mine and blast protected vehicles. In the 

same year the Australian Government joined the United States Joint Light 

Tactical Vehicle (JLTV) Development Program, which could see the PMV-L 

manufactured outside of Australia, albeit with potentially some Australian 

input. In 2009 the Department of Defence (DoD) released a Request for 

Proposal for the manufacture and support of the PMV-L in Australia. While a 

decision has not been made, the impact of not manufacturing the PMV-L in 

Australia could have a significant impact at both the firm level and on the 

economy more broadly. 

The project’s impact on Australian suppliers 

There are 120 Australian suppliers to Bushmaster vehicles, providing both 

goods and services to the Thales Australia production process, as well as 

through life support (TLS). ACIL Tasman conducted a survey of 113 of these 

suppliers to gauge the firm level impact of being involved with Bushmaster 

production and TLS. Of these suppliers, 77 responded to the survey, which 

represents a 68 per cent response rate. Importantly, these respondents 

contributed to nearly 96 per cent of Thales Australia‘s total Bushmaster vehicle 

supplier spend per year, and nearly the same contribution to Thales 

expenditure on suppliers has been maintained in the current production period 

(PP3). 

Bushmaster suppliers are predominantly small or medium businesses with 

lower end revenues, and the survey results indicate that their involvement with 

Bushmaster has often lead to the implementation of new programs, practices 

and technology transfers. Bushmaster involvement has also impacted on 

business indicators, including, productivity, export potential and ability to carry 

out other DoD contracts. Some of the key survey findings are shown in 

Figure ES 1 

Executive summary iii


Figure ES 1 Key survey findings from survey of Bushmaster suppliers 

A: Type of support provided to Bushmaster vehicles (n=77) 

0% 20% 40% 60% 80% 100% 

Proportion of respondents (%) 

Only assists with inputs to production 

Only assists with through life support 

Assists with inputs to production and through life support 

C: Role of Bushmaster vehicle involvement in implementing 

programs and practices (n=36) 

Export market planning 

Process engineering 

Performance benchmarking 

Just-in-time supply 

Business alliances or partnerships 

Formal strategic plan 

Outsourcing/subcontracing 

Formal business plan 

Budget forecasting 

Quality assurance 

Quality managment 

Source: ACIL Tasman survey of suppliers. 

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 

Number of respondents 

Important Crucial 

E: Productivity changes as a result of being involved with 

Bushmaster vehicles (n=77) 

0 5 10 15 20 25 30 35 40 45 50 


Increased slightly Increased moderately Increased substantially 

Other 

Opportunities for new export business 

Participation in global supply chain 

Level of export sales 

Market share 

Production flexibility 

Product/service quality 

Production costs 

Productivity 

Opportunities for new domestic business 

Product range 

Level of defence related sales 

B: Impact of technology transfer of business (n=12) 

0 1 2 3 4 5 6 7 8 9 10 11 


Minor to moderate impact Major positive impact 

D: Impact of involvement with Bushmaster vehicles of 

future ability to export (n=77) 

0 5 10 15 20 25 30 35 40 


Positive Strong positive 

F: Change in Defence capability as a result of Bushmaster involvement (n=51) 

Can supply defence equipment/services at a lower cost than … 

Can provide a better quality defence product or service than … 

Can supply the DoD or its contractors at a faster rate than … 

Can work in/with new areas of defence related technology 

Can now assist in the through life support of Bushmaster … 

Has the capacity to help supply DoD's capability requirements 

Has the resources to help supply DoD's capability requirements 

Has the knowledge to supply DoD's capability requirements 

0 10 20 30 40 50 60 70 80 90 100 


Agree Strongly agree 

Executive summary iv

Both production and TLS are 

important to most suppliers 

A number of suppliers 

obtained a technology 

transfer 

Uptake of programs and 

practices 

Improved export potential 

Sustained productivity 

improvements 

Improved capability to 

supply DoD contracts 

A win for industry and DoD 


Most survey respondents (70.1 per cent) were engaged in the supply of both 

inputs to production and TLS of the Bushmaster vehicles (see Figure ES 1 

Panel A). This suggests that these businesses will provide ongoing support to 

the vehicle long after the final vehicle rolls off the production line. 

A technology transfer is the transfer of intellectual property, between 

developers and the users (in this case the Bushmaster suppliers). A relatively 

small number of respondents (15. 6 per cent or 12 respondents) indicated that 

they had had a technology transfer. However, the impact of the technology 

transfer was somewhat significant for those recipients. Many of these 

businesses reported an impact on the level of defence related sales, product 

range and opportunities for new domestic business, as well as productivity, 

production costs and product or service quality (see Figure ES 1 Panel B). 

For 36 suppliers (46.8 per cent of respondents), being involved with 

Bushmaster played a role in the decision to implement new programs and/or 

practices. Quality management and quality assurance practices were by far the 

leading programs/practices taken up as a result of Bushmaster involvement 

(see Figure ES 1 Panel C). This outcome no doubt reflects the stringent 

standards applied to Defence contracts. 

For 29 respondents (37.7 per cent), being involved in Bushmaster had the 

potential to improve their future ability to export, with four respondents 

believing that their involvement had a very strong, positive impact on 

exportability (see Figure ES 1 Panel D). 

While most respondents reported relatively stable productivity as a result of 

their involvement with Bushmaster, 34 respondents (44.2 per cent) reported a 

productivity increase arising from the business‘s involvement with the project. 

Of these respondents 17 reported a slight increase, 12 a moderate increase and 

five a substantial increase (see Figure ES 1 Panel E). Importantly, for all bar 

one respondent, the change in productivity has been sustained over time. 

In terms of being able to service other DoD contracts, 51 respondents (66.2 

per cent) believed that working on Bushmasters has put their business in a 

better position to supply the DoD or its prime contractors. This improved 

Defence capability was due to factors such as better knowledge, better 

resources and better capacity (see Figure ES 1Panel F). 

Overall, the survey results provided strong indicators that Bushmaster 

involvement had been beneficial to most suppliers – it had improved their 

ability to provide Defence support into the future; it had lead to technology 

transfers and/or implementation of new products and practices; it had 

improved their future ability to export; and lead to a sustainable increase in 

productivity. While it is recognised that all respondents may not have 

Executive summary v


experienced positive outcomes in all areas, most experienced an improvement 

in at least one area of their business, which can be attributed to involvement 

with Bushmaster production and TLS. 

The project’s economy wide impact 

Computable general equilibrium (CGE) modelling undertaken using ACIL 

Tasman‘s Tasman Global model, allowed us to estimate the direct and indirect 

economic impact of manufacturing the Bushmaster vehicles in Australia, rather 

than the hypothetical scenario where the Bushmaster vehicles are 

manufactured overseas and imported by the DoD. In addition to production 

of the Bushmaster vehicles in Australia, the modelling also took into 

consideration the economic impact of providing TLS in Australia. 

The modelling was undertaken using a database which separately identified the 

Bendigo region, the rest of Victoria, and the rest of Australia. As a result, the 

impact of the program has been assessed for the Bendigo region, Victoria as a 

whole and Australia as a whole. 

The results of the CGE modelling demonstrate that the production of 

Bushmaster vehicles (and their through life support) in Australia is having a 

significant positive impact on Bendigo‘s Gross Regional Product (GRP), 

Victoria‘s Gross State Product (GSP) and Australia‘s Gross Domestic Product 

(GDP) and Gross National Product (GNP). Time series results are reported in 

Figure ES 2 and high level summary results are presented in Box ES 1. 

Figure ES 2 Direct and indirect contribution of Bushmaster production and TLS to Australian GDP, 

Victorian GSP and Bendigo GRP ($2008 million) 

140 

120 

100 

80 

60 

40 

20 

$m 

TLS 

Production 

Data source: ACIL Tasman estimates. 

A. Australian GDP B. Victorian GSP and Bendigo Region GRP 

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

120 

100 

80 

60 

40 

20 

$m 

Rest of Victoria 

Bendigo Region 

2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

Executive summary vi


Box ES 1 Summary total impact of manufacturing and supporting Bushmaster vehicles in 

Australia 

Bendigo 

Compared to not having Bushmaster vehicles manufactured and supported in Australia, between 2002 and 2016: 

• The stream of GRP is $572 million higher 

• An annual average of 561 FTE jobs have been created 

– Peaking at 913 FTE jobs in 2010 





– Peaking at 238 FTE jobs in 2010. 

Victoria (i.e. Bendigo plus Rest of Victoria) 


• The stream of GRP is $1,025 million higher 


– Peaking at 1,150 FTE jobs in 2010. 

Australia 


• The stream of GDP is $1,132 million higher 

• The stream of GNP is $1,314 million higher 


– Peaking at 1,023 FTE jobs in 2010. 

Note: All financial values are in 2008 dollars. 

Source: ACIL Tasman, Note: All financial values are in 2008 dollars. 

Bushmaster’s impact on GRP, 

GSP and GDP in the 2011 

peak year 

Bushmaster’s impact on GRP, 

GSP and GDP in 2016 

The highest annual contribution to the economy‘s income (as measured by 

GRP, GSP and GDP) from combined Bushmaster production and TLS occurs 

in 2011, when: 

• Bendigo GRP is $71.9 million ($2008) higher 

• Victorian GSP is $110.5 million ($2008) higher 

• Australian GDP is $120.8 million ($2008) higher. 

After this point in time, Thales Australia‘s current contract to supply 

Bushmasters to the DoD will have been finalised and, as a result, the project‘s 

contribution to the three economies‘ income declines. However, continued 

Executive summary vii

Total impact on Australian 

GDP 

Bendigo and the state of 

Victoria are the major 

beneficiaries of the GDP 

increase 

Total impact on Australian 

GNP 

Employment impact 


Bushmaster production based on forecast export orders, continues to make a 

significant contribution to the economy. For example, in 2016: 

• Bendigo GSP is $39.8 million ($2008) higher 

• Victorian GSP is $82.4 million ($2008) higher 

• Australian GDP is $100.4 million ($2008) higher. 

This on-going contribution to income is derived from Bushmaster TLS activity 

in Australia as well as the production for export. Furthermore, the positive 

outcome is also supported by long term positive productivity gains made by 

many Bushmaster suppliers, which were driven by their involvement in the 

project. 

Thus, for a DoD capital expenditure of $770 million ($2008) to purchase 

Australian made Bushmaster vehicles, the Australian economy will have 

enjoyed an additional $998 million ($2008) of GDP over the period 2002 to 

2016, compared to a situation where similar vehicles were imported by the 

DoD. Once TLS is factored into the analysis, the steam of GDP value created 

from the Bushmasters increases to $1,132 million ($2008) of GDP. 

Victoria, as the major beneficiary of the change in GDP attributable to 

combined Bushmaster production and TLS, enjoys an additional stream of 

$1,025 million ($2008) of GSP over the period 2002 to 2016. Over the same 

period, Bendigo – the home of Bushmaster production – will have produced 

an additional stream of $572 million ($2008) of GRP as a result of the 

Government‘s decision to manufacture the Bushmaster vehicles in regional 

Australia rather than importing a similar vehicle from overseas. 

In terms of GNP, over the period 2002 to 2016 an additional stream of $1,135 

million ($2008) of GNP will be enjoyed by Australians as a result of 

manufacturing the Bushmaster vehicles, with an additional $179 million 

($2008) of GNP raised by TLS services. Thus the net impact of the 

Government‘s decision to produce and support the Bushmaster vehicles in 

Australia, rather than purchase and support the vehicles overseas, is a higher 

stream of GNP over the period 2002 to 2016 of $1,314 million (2008 dollars). 

The highest annual contribution to the economy‘s GNP from combined 

Bushmaster production and TLS occurs in 2011, when Australian GNP is $144 

million ($2008) higher. 

The impact of manufacturing Bushmaster vehicles in Australia and providing 

TLS also has a positive impact on employment - not only directly through 

Thales' employment, but also indirectly by producers supplying goods and 

services into the Bushmaster supply chain or supplying the increased 

consumption generated as a result of the additional wage and salary income in 

the economy. The annual average of direct and indirect jobs created as a result 

Executive summary viii


of Bushmaster production and TLS over the period 2002 to 2016 is estimated 

to be: 

• 560 full time equivalent (FTE) jobs in the Bendigo region 

• 776 FTE jobs across Victoria 

• 709 FTE jobs Australia wide. 

Employment peaks in 2010, which is the penultimate year of Bushmaster 

production for the DoD under the BUSHRANGER contract. Thus, in 2010, 

compared with a hypothetical situation where the DoD had purchased and 

supported similar vehicles through imports: 

• Bendigo employment will be around 913 FTE jobs higher 

• Victorian employment will be 1,207 FTE jobs higher 

• Australian employment will be 1,091 FTE jobs higher (see Figure ES 3). 

Figure ES 3 Direct and indirect contribution of Bushmaster production and TLS to FTE employment 

1,200 

1,000 

800 

600 

400 

200 

$m 

TLS 

Production 


A. Australian employment B. Victorian employment and Bendigo Region employment 

2002 2004 2006 2008 2010 2012 2014 2016 

1,400 

1,200 

1,000 

800 

600 

400 

200 

Jobs 


Bendigo region 

2002 2004 2006 2008 2010 2012 2014 2016 

Potential impact of manufacturing the PMV-L in 

Australia 

CGE modelling has also been undertaken to assess the likely impact of 

constructing the Protected Mobility Vehicle – Light (PMVL) in Australia rather 

than the DoD importing the same 1 vehicle from a foreign supplier. 

The analysis of this scenario essentially involved the development of a likely 

cost structure for the construction of PMVLs in Thales Australia‘s Bendigo 

plant over the period 2012 to 2016. A third model scenario was then run 

through Tasman Global to identify the economic contribution of the PMVL‘s 

1 ‗Same‘ in terms of price per vehicle and assumed impacts on DoD‘s performance. In reality 

the vehicles will be different each with their own strengths and weaknesses which may or 

may not affect DoD‘s ability to (or cost of) performing their tasks. 

Executive summary ix


domestic construction compared to an alternative situation where the DoD 

imports for the same cost a 100 per cent foreign built vehicle. 

The analysis only focused on the likely impact of the production of an initial 

order of 1,300 PMVLs in Australia. The impact of additional vehicle orders by 

the Commonwealth, export orders for the vehicle, TLS or any additional 

supplier productivity improvements which might arise as a result of the 

program were not considered. The results therefore represent the minimum 

potential impacts of a domestic PMV-L production program. Summary results 

can be found in Box ES 2. 

Box ES 2 Summary total impact of manufacturing and supporting 1,300 PMVLs in Australia 

Bendigo 

Compared to not having PMVLs manufactured in Australia, between 2012 and 2016: 


• An annual average of 488 FTE jobs will be created 







Victoria (i.e. Bendigo plus Rest of Victoria 


• The stream of GSP is $232 million higher 



Australia 


• The stream of GDP is $261 million higher 

• The stream of GNP is $327 million higher 




Source: ACIL Tasman, Note: All financial values are in 2008 dollars. 

Executive summary x

PMVL production increases 

GDP, GSP and GRP 


GNP 


The modelling indicates that the construction of the PMVLs in Australia rather 

than purchasing similar vehicles from a supplier located outside of Australia 

will positively impact Australia‘s income (GDP). As was the case for the 

Bushmasters, the bulk of the growth in GDP will be generated in the Victorian 

economy, in particular in the Bendigo region. 

Over the five year production phase: 

• Australian GDP would be a total of $261 million ($2008) higher than in the 

absence of the PMVL project 

• Bendigo would experience an additional $199 million ($2008) of GRP 

• Victorian GSP would increase by an additional $232 million ($2008). 

The peak year of this positive GDP impact will be 2015, in that year: 

• Australia‘s GDP would be $64 million ($2008) higher 

• Victorian GSP would be $56 million ($2008) higher 

• Bendigo GSP would be $48 million ($2008) higher (see Figure ES 4). 

Figure ES 4 Direct and indirect contribution of PMVL Australian production to 

Bendigo GRP, Victorian GSP and Australian GDP ($2008 million) 

70 

60 

50 

40 

30 

20 

10 

$m 

Australia 



Source: ACIL Tasman estimates. 

2012 2013 2014 2015 2016 

Australia will enjoy higher GNP as a result of a decision to produce the 

PMVLs in Australia, rather than importing similar vehicles from a supplier 

located outside of Australia. Over the five year production phase, Australian 

GNP would be a total of $327 million ($2008) higher than in the absence of 

the PMVL project. The peak year of this positive GNP impact will be 2015. In 

that year Australia‘s GNP would be $79 million ($2008) higher (see Figure ES 

5). 

Executive summary xi


employment 


Figure ES 5 Direct and indirect contribution of manufacturing PMV-Ls in 

Australian to Australian GNP ($2008 million) 

90 

80 

70 

60 

50 

40 

30 

20 

10 

$m 

41 


The production of the PMVL vehicles in Australia will also have a positive 

impact on employment (see Table ES 1). For example, nationally in 2012, 

PMVL production could generate an additional 363 FTE jobs, further 

increasing to 614 FTE jobs in 2015. On average, over the five year production 

period the project would create 523 FTE Australian jobs, most of which would 

be generated in Victoria, with the majority of these being created in the 

Bendigo region. 

In all instances, 2014 is the peak year for job creation: 

• 574 jobs created in Bendigo 

• 670 FTE jobs created across Victoria 

• 614 FTE jobs created nationally. 

Table ES 1 Direct and indirect contribution of manufacturing PMV-Ls in 

Australia to Australian FTE jobs 

2012 2013 2014 2015 2016 

Annual 

average 

Bendigo region 336 480 574 572 477 488 

Victoria 394 560 670 668 556 570 

Australia 363 513 614 614 511 523 


60 

2012 2013 2014 2015 2016 

Executive summary xii 

76 

79 

70


Contents 

Executive summary iii 

1 Introduction 1 

1.1 Background on the Bushmaster vehicles 1 

1.1.1 Protected Mobility Vehicle-Light 3 

2 Survey methodology 4 

3 Survey findings 5 

3.1 A snapshot of the respondents‘ characteristics 5 

3.2 Technology transfer 9 

3.3 Use of best practice programs and practices 15 

3.3.1 Importance of Bushmaster in implementing some 

programs/practices 16 

3.3.2 Impact of programs or practices on business indicators 19 

3.4 Exports 22 

3.5 Productivity changes 25 

3.6 Employment impact 27 

3.7 Capability to supply Defence or its contractors 29 

4 Economy wide impacts of BUSHRANGER 31 

4.1 Estimating the economic impact 31 

4.1.1 Computable general equilibrium modelling 32 

4.2 Developing the model‘s database 33 

4.3 The reference case and project scenario 34 

4.3.1 The full employment assumption 35 

4.4 Shocking the reference case – a hypothetical scenario 36 

4.5 Shocking the reference case – actual scenario 37 

4.5.1 Gross Domestic Product 37 

4.5.2 Gross National Product 40 

4.5.3 Employment 41 

5 Potential impact of constructing PMV-L in Australia 45 

5.1.1 Gross Domestic Product 45 

5.1.2 Gross National Product 46 

5.1.3 Employment 47 

Bibliography i 

A Survey questionnaire A-1 

B The Tasman Global model B-1 

xiii


C CGE modelling results for Bushmaster production and TLS C-1 

D CGE modelling results for PMV-L production D-1 

List of boxes 

Box ES 1 Summary total impact of manufacturing and supporting Bushmaster 

vehicles in Australia vii 

Box ES 2 Summary total impact of manufacturing and supporting 1,300 PMVLs in 

Australia x 

Box 1 Working side by side to enhance passenger safety 13 

Box 2 Improving outcomes for even the smallest supplier 21 

Box 3 How a combination of R&D and Defence work leads to new export 

opportunities 24 

Box 4 Improving Defence capabilities 30 

Box 5 GRP, GSP and GDP impact of manufacturing and supporting 

Bushmaster vehicles in Australia 40 

Box 6 GNP impact of manufacturing and supporting Bushmaster vehicles in 

Australia 41 

Box 7 Employment impact of manufacturing Bushmasters in Australia 43 

List of figures 

Figure ES 1 Key survey findings from survey of Bushmaster suppliers iv 

Figure ES 2 Direct and indirect contribution of Bushmaster production and TLS to 

Australian GDP, Victorian GSP and Bendigo GRP ($2008 million) vi 

Figure ES 3 Direct and indirect contribution of Bushmaster production and TLS to 

FTE employment ix 

Figure ES 4 Direct and indirect contribution of PMVL Australian production to 

Bendigo GRP, Victorian GSP and Australian GDP ($2008 million) xi 

Figure ES 5 Direct and indirect contribution of manufacturing PMV-Ls in Australian 

to Australian GNP ($2008 million) xii 

Figure 1 Geographic location of survey respondents versus all suppliers 5 

Figure 2 Provision of goods, services and through life support (n=77) 6 

Figure 3 Extent of importance of TLS to future business growth (n=58) 7 

Figure 4 Size of respondents based on number of employees at 30 June 2008 

(n=75) 8 

Figure 5 Annual revenue, 2007-08 (n=72) 9 

Figure 6 Means through which technology transfer obtained (n=12) 10 

Figure 7 Means of obtaining technology transfer by size of business (n=12) 11 

Figure 8 Impact of the technology transfer on... (n=12) 12 

Figure 9 Impact of technology transfer by size of business (respondents reporting 

minor/moderate and major impact) (n=12) 15 

Figure 10 Use of various business programs and practices 16 

Figure 11 Importance of Bushmasters in implementing programs and practices 

(n=36) 17 

Figure 12 Importance of Bushmaster involvement in implementing individual 

programs and practices (n=36) 18 

xiv


Figure 13 Importance of Bushmaster involvement in implementing individual 

programs and practices by size of business (n=36) 19 

Figure 14 Impact of programs and practices on... (n=77) 20 

Figure 15 Impact of Bushmaster involvement on export ability (n=77) 23 

Figure 16 Changes to annual export sales since involved with Bushmasters (n=15) 23 

Figure 17 Impact of different factors on changes in exports (n=15) 25 

Figure 18 Change in productivity since Bushmaster involvement (n=77) 26 

Figure 19 Extra workers at different stages of involvement in Bushmasters (n=20) 28 

Figure 20 As a result of being involved in Bushmaster vehicles, the business... 

(n=51) 29 

Figure 21 Estimating the economic impact of a project 32 

Figure 22 Loddon statistical division of Victoria 34 

Figure 23 Historical annual average unemployment rate by region 36 

Figure 24 Illustrative Bushmaster scenario analysis using Tasman Global 37 

Figure 25 Direct and indirect contribution of Bushmaster production to GDP, 

GSP and GRP ($2008 million) 38 

Figure 26 Direct and indirect contribution of Bushmaster production and TLS to 

Australian GDP, Victorian GSP and Bendigo GRP ($2008 million) 39 


Australian GNP 41 

Figure 28 Direct and indirect contribution of Bushmaster production to FTE 

employment 42 


FTE employment 44 

Figure 30 Direct and indirect contribution of PMV-L production in Australia to 

Australian GDP, Victorian GSP and Bendigo GRP ($2008 million) 46 

Figure 31 Direct and indirect contribution of PMV-L production in Australia to 

Australian GNP ($2008 million) 47 

Figure 32 Assumed growth in population (per cent, year on year) B-7 

Figure 33 Assumed growth in labour supply, reference case (per cent, year on year) B-8 

Figure 34 Historical and assumed unemployment by region, reference case B-9 

Figure 35 Real economic output growth by region, reference case B-10 

List of tables 

Table ES 1 Direct and indirect contribution of manufacturing PMV-Ls in Australia 

to Australian FTE jobs xii 

Table 1 Bushmaster and variant production (actual and forecast) 3 

Table 2 Size of supplying businesses – Bushmaster vs. Minehunter 8 

Table 3 Sources of technology transfer – Bushmasters vs. Minehunters 11 

Table 4 Impact of technology transfer – Bushmasters vs. Minehunters. 14 

Table 5 Direct and indirect contribution of PMV-L production in Australian to 

Australian FTE jobs 47 

Table 6 Sectors in the Tasman Global database B-3 

Table C1 Bushmaster production GDP $m impacts ($2008) C-1 

Table C2 Bushmaster TLS GDP $m impacts ($2008) C-1 

Table C3 Bushmaster production GNP $m impacts ($2008) C-2 

Table C4 Bushmaster TLS GNP $m impacts ($2008) C-2 

Table C5 Bushmaster production FTE employment impacts C-3 

Table C6 Bushmaster TLS FTE employment impacts C-3 

xv


Table D1 PMV-L production GDP $m impacts ($2008) D-1 

Table D2 PMV-L production GNP $m impacts ($2008) D-1 

Table D3 PMV-L production FTE employment impacts D-1 

xvi


1 Introduction 

ACIL Tasman has been commissioned by Thales Australia to undertake an 

analysis of the economic contribution the construction and support of the 

Bushmaster vehicles makes to the Australian economy and to Australian 

industry more generally. The potential contribution of a future project to 

construct light protected vehicles under Phase 4 of Project OVERLANDER in 

Australia has also been analysed. 

This work follows on from two earlier projects undertaken by two of ACIL 

Tasman‘s predecessors, which examined the economic impact of the: 

• ANZAC Ship Project (Tasman Asia Pacific, 2000) 

• Minehunter Coastal Project (Tasman Economics, 2002). 

Consistent with the earlier two projects, this current analysis of the impact of 

constructing and supporting the Bushmaster vehicles in Australia relies on a 

survey of Australian suppliers to Thales Australia (the Bushmaster‘s prime 

contractor) and general equilibrium modelling. The survey methodology and 

firm level survey findings are reported in Chapters 2 and 3. The economy wide 

impacts of the Australian Government‘s decision to construct and support the 

Bushmaster vehicles in Australia are reported in Chapter 4. The potential 

impact of constructing the light protected vehicles under Phase 4 of Project 

OVERLANDER in Australia rather than overseas is considered in Chapter 5. 

1.1 Background on the Bushmaster vehicles 

The Bushmaster 4x4 protected mobility vehicle (the Bushmaster) is a highly 

mobile, mine protected, armoured patrol and combat support vehicle. While 

the Bushmaster has a long list of benefits, its headline features include its 

exceptional protection and mobility, an ability to travel at a sustained speed up 

to 100 kph, and a carrying capacity of up to 10 soldiers with three days worth 

of equipment, fuel and supplies onboard. 

The history of the Bushmaster vehicle extends back to the 1994 White Paper, 

Defending Australia. The White Paper outlined the acquisition of land force 

vehicles offering both protection and mobility, and that would be used during 

land operations in Northern Australia. Phase 2 of Project BUSHRANGER 

(Land 116) was tendered by the Department of Defence (DoD) to find such a 

vehicle for use by the Australian Army. Two vehicles – the Taipan 4x4 and the 

Bushmaster – were shortlisted for 44 weeks of trials. The Bushmaster was 

found to be the preferred vehicle and in 1999, Thales Australia entered into a 

contract to supply the Australian Army with 370 Bushmaster vehicles. 

Introduction 1


A range of further enhancements to the originally proposed vehicle delayed 

commencement of production and resulted in the original DoD contract being 

renegotiated and amended to supply 299 vehicles. However despite the initial 

contractual delay, the overall success of the vehicle is undisputed as the 

Bushmaster platform has proven its worth in combat in Iraq and Afghanistan. 

For example, an Australian Defence Magazine article in March 2009 discussed 

the qualities of the Bushmaster vehicle: 

Meanwhile Bushmaster continues to demonstrate its capabilities in combat. 

Involved in a number of serious incidents, all have seen the occupants able to walk 

away without serious injuries with only four vehicles known to be irreparable. 

One of these is now being used as a pillbox at Camp Holland in Tarin Kowt. 

Another Dutch Bushmaster flown to Bendigo for repair received the blast of two 9kg 

antitank mines underneath the front wheel stations. 

Although the vehicle was immobilised, its crew received only minor injuries and the 

vehicle was recovered by an accompanying Bushmaster (Kerr, 2009). 

At the time of this report, the success of Bushmaster in the field has resulted in 

a range of further contracts with the DoD, with total ADF orders of 

Bushmaster variants currently stands at 737 vehicles. The value of the 

BUSHRANGER contract (i.e. to supply Bushmasters) is in the order of $770 

million ($2008). 

The DoD has also entered into a through life support (TLS) agreement with 

Thales Australia to support these vehicles. The last of the contracted 

Bushmasters is expected to be delivered to the Army in 2011. 

The success of the Bushmaster variants has seen Thales Australia achieve 

additional sales of 15 Bushmaster variants to Forestry South Australia for fire 

fighting (the Firekings). The Bushmaster‘s demonstrated defence capability 

also attracted interest from foreign governments, resulting in over 80 

Bushmaster variants being exported to the Dutch and British defence forces 

for use in Iraq and Afghanistan. Thales Australia is confident of obtaining 

further export orders for Bushmaster variants in the future. Current 

Bushmaster variants include: 

• Infantry mobility vehicle – the original concept vehicle 

• Command and control vehicles – additional capacity for communications 

equipment 

• Engineering vehicle – additional ‗workshop‘ capacity 

• Mortar carrier, direct-fire weapon, air defence – less people carrying 

capacity but capacity to carry more weaponry 

• Ambulance – capacity to carry casualties with serious injuries, including 

stretcher stations 

• Fire fighting and crew protection vehicle 

Introduction 2


• Logistics (Single Cab) 

All variants can be manufactured off the same production line. Table 1 

presents the production profile for Bushmasters vehicles from Thales‘ Bendigo 

plant. Thales Australia is currently working to win additional export orders for 

Bushmaster variants and these orders are shown as forecasts in the table. 

Table 1 Bushmaster and variant production (actual and forecast) 

F/cast F/cast F/cast 

2003 2004 2005 2006 2007 2008 2009 2010 2011 Total 

Bushranger Project (ADF) 3 12 87 112 128 100 100 100 95 737 

Fireking 1 10 4 15 

Export - Netherlands & UK 25 11 37 31 104 

Export Forecast other 10 40 40 90 

Total Production Units 4 22 91 137 139 137 141 140 135 946 

Note: The ADF contracts total some 736 vehicles. However, 737 vehicles will be delivered to the ADF. 

Data source: Thales Australia 

1.1.1 Protected Mobility Vehicle-Light 

In 2008 the Australian Government launched an acquisition programme to 

replace the Army‘s current fleet of light vehicles with a Protected Mobility 

Vehicle – Light (PMV-L) category of mine and blast protected vehicles. In the 

same year the Australian Government joined the United States Joint Light 

Tactical Vehicle (JLTV) Development Program, which could see the PMV-L 

manufactured outside of Australia, albeit with potentially some Australian 

input. Membership of this program would see Australia funding nine 

prototype vehicles, with the United States funding a further 21 prototypes. 

Each of the prototypes would be manufactured outside of Australia. 

On 12 June 2009, the Minister for Defence Personnel, Materiel and Science, 

the Hon. Greg Combet, released a request for proposals for the supply of 

Australian designed and manufactured prototype vehicles meeting Phase 4 of 

the LAND 121 Program – Protected Mobility Vehicle-Light (PMV-L). Under 

LAND 121 Phase 4, Australia will procure 1,300 PMV-L vehicles and trailers 

(The Hon. Greg Combet AM MP, 2009). These vehicles would be either 

Command, Liaison, Reconnaissance or Utility vehicles. 

Introduction 3


2 Survey methodology 

A survey questionnaire was developed as the primary means to collect firm 

level data from Thales‘s Bushmaster suppliers. This data has been used to 

form qualitative and quantitative assessments of the impact of manufacturing 

and supporting the Bushmaster vehicles in Australia. 

ACIL Tasman developed the survey questionnaire form using an online survey 

tool. The earlier Minehunter Coastal Project survey was the starting point for 

the Bushmaster survey. However, the survey was refined to reflect the current 

project and Thales Australia was consulted on the final set of questions. 

Testing of the survey form was undertaken internally. The survey questionnaire 

is reproduced in Appendix A. 

The survey was sent to 113 Australian businesses that provide inputs to 

Bushmaster production and/or through life support (TLS). There are an 

additional seven international suppliers, however these businesses were not 

required to participate in the survey. The survey process included: 

• A letter from Josip Juric (Purchasing Manager, Protected Mobility Systems, 

Land and Joint Systems Division, Thales) sent on Wednesday 10 June 2009 

introducing the study and the survey 

• Launching the survey on Monday 15 June 2009 and inviting businesses to 

complete the survey online 

• Reminder email sent to all non-respondents on Thursday 18 June 2009 

• Follow-up phone calls to ‗Top 25‘ suppliers on Friday 19 June and Monday 

22 June 2009 

− The decision to restrict the telephone follow up to only 25 of the 113 

supplying businesses was made because the dollar input of this group 

comprised 86 per cent of the total dollar input from all businesses. 

− It should be noted that the ‗Top 25‘ was selected based on the current 

contract spend using data supplied by Thales. 

Survey methodology 4

Experience with Defence 

contracts 

Main activity 


3 Survey findings 

In total 77 of the 113 businesses contacted to participate in the survey 

responded, representing a 68 per cent response rate. The businesses 

responding to the survey provide a sound representation of the whole survey 

group. In the first instance, the geographic location of survey respondents is 

very similar to the geographic location of all domestic Bushmaster suppliers 

(see Figure 1). 

Figure 1 Geographic location of survey respondents versus all suppliers 

100% 

90% 

80% 

70% 

60% 

50% 

40% 

30% 

20% 

10% 

0% 

Note: Rest of Australia includes suppliers whose location was not specified. 

Source: Thales Australia. 

Survey respondents All domestic suppliers 

Furthermore, taking into consideration the value of supplier expenditure in the 

current production period (PP3), survey respondents represent nearly 96 per 

cent of total PP3 spending by all domestic suppliers. In terms of approximate 

spend per year, the survey respondents represent nearly 96 per cent of the total 

spend by all domestic suppliers (Thales Australia). 

3.1 A snapshot of the respondents’ characteristics 

For most of the companies surveyed, the Bushmasters was not their first 

Australian defence related contract. Of the respondents: 

• 62.3 per cent had been involved in other Australian defence contracts 

• 37.7 per cent had not. 

Rest of Australia 


Bendigo 

Around three quarters of survey respondents (75.3 per cent) indicated that 

their main activity was the manufacture of goods or products for the 

Survey findings 5

Assistance provided to 

Bushmasters 

Important of TLS to future 

growth 


Bushmasters. The remaining respondents‘ (24.7 per cent) main activity was the 

provision of services to the project. 

In terms of assistance provided to the Bushmasters, most companies 

continued to provide through life support (TLS) to the goods or services they 

provided (see Figure 2). Around 70 per cent of respondents complemented 

their inputs with TLS. Nearly 25 per cent provided inputs to production only, 

while five per cent only provided TLS. 

Figure 2 Provision of goods, services and through life support (n=77) 

0% 20% 40% 60% 80% 100% 


Proportion of respondents 

Only assists with inputs to production 

Only assists with through life support 

Assists with inputs to production and through life support 

Of the 75 per cent of respondents (58 businesses) that participated in TLS, 

with or without the provision of inputs to production, 27.6 per cent indicated 

that their involvement with Bushmaster TLS was crucial to the future growth 

of their business (see Figure 3). A further 65.5 per cent of respondents 

involved in TLS indicated that this involvement was important to the future 

growth of their business. Only 6.9 per cent of respondents indicated that 

being involved in TLS for Bushmasters was not important to the future growth 

of their business. 

Survey findings 6

Size of the business at 30 

June 2008 


Figure 3 Extent of importance of TLS to future business growth (n=58) 

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 



Not important Important Crucial 

The majority of survey respondents are ‗smaller‘ sized businesses – four per 

cent were not employing at 30 June 2008, 10.7 per cent were micro businesses 

(i.e. one to four employees) and 32 per cent were small businesses (i.e. five to 

19 employees). 

A further 35 per cent of respondents were medium sized businesses (i.e. 20 to 

200 employees). Of these around a third (16 per cent of all respondents) were 

‗smaller‘ medium sized businesses (i.e. 20 to 49 employees). In total, 62.7 per 

cent of survey respondents had less than 50 employees. Most of the remaining 

respondents were ‗larger‘ medium businesses, with 29.3 per cent of 

respondents reporting between 50 and 199 workers. Only eight per cent of 

respondents were large businesses; that is a business which employed 200 or 

more people. 

Survey findings 7

– Bushmaster vs. Minehunter 

Annual revenue in 2007-08 


Figure 4 Size of respondents based on number of employees at 30 June 

2008 (n=75) 

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100% 

Note: Two respondents did not provide detail on employment. 



Not employing Micro Small Medium Large 

The sizes of the businesses involved in Bushmasters are consistent with those 

that supplied the Minehunter Coastal Project (see Table 2), with the biggest 

difference being that the Minehunter project had a slightly larger proportion of 

larger businesses participating - 14 per cent compared to eight per cent in 

Bushmaster. 

Table 2 Size of supplying businesses – Bushmaster vs. Minehunter 

Number of employees Bushmasters (%) Minehunters (%) 

Micro (less than 5 employees) 14.7 12.5 

Small (5-19 employees) 32.0 30.5 

Medium (20-199 employees) 45.3 43.0 

Large (200 or more employees) 8.0 14.0 

Note: For Bushmaster vehicles, micro includes „not employing „ and „micro‟ businesses‟, and medium includes „medium 

(smaller)‟ and „medium (larger)‟ 

Data source: Bushmaster survey and ACIL Tasman Minehunter study, 2002. 

Nearly half of the survey respondents had revenue of less than $10 million, 

with 11.1 per cent earning less than $1 million, 23.6 per cent in the range $1 

million to $5 million, and 18.1 per cent in the range $5 million to $9.9 million. 

In terms of larger revenues, 12.5 per cent had revenue in the range $10 million 

to $19.9 million, and 11.1 per cent in the range $40 million to $49.9 million. 

No respondents reported more than $300 million in total revenue in 2007-08 

(see Figure 5). 

Survey findings 8

Means of obtaining 

technology transfer 


Figure 5 Annual revenue, 2007-08 (n=72) 

$40m to 

$49.9m 

11% 

$30m to 

$39.9m 

4% 

$50m to 

$99.9m 

7% 

$20m to 

$29.9m 

6% 

$100m to 

$299.9m 

7% 

$10m to 

$19.9m 

12% 


3.2 Technology transfer 

$0 to $499K 

5% 

$5m to $9.9m 

18% 

$500K to $999K 

6% 

$1m to $4.9m 

24% 

A technology transfer is the transfer of intellectual property, such as skills, 

knowledge, technologies, methods of manufacturing, samples, etc, between 

developers (such as research organisations or Defence prime contractors) and 

the users (such as the suppliers of inputs to Bushmaster vehicles). 

Of the survey respondents, 12 (15.6 per cent) indicated that they obtained a 

technology transfer as a result of their involvement with Bushmaster 

production and/or TLS. This level of technology transfer is lower than 

observed in the earlier studies of the impact of the Minehunter and ANZAC 

Ship projects, which found over 20 per cent of respondents reporting 

obtaining a technology transfer (Tasman Economics, 2002). 

Many of the 12 businesses that reported obtaining a technology transfer 

obtained it via prototyping activity (nine businesses). For eight respondents, 

technology transfers were obtained through existing published material, R&D 

or design activity. Other means through which the technology transfers were 

obtained included strategic partnerships with other organisations (seven 

businesses), staff training (six businesses), purchasing or licencing technology 

(four businesses), recruitment or secondment into other businesses (two 

Survey findings 9


businesses) and Bushmaster related Defence offsets agreement (one business). 

Figure 6 charts the types and frequencies of transfers. 

Figure 6 Means through which technology transfer obtained (n=12) 

Secondment of this business' staff to other organisations 

Bushmaster related Defence offsets agreement 



Recruitment or secondment into this business 

Other 

Purchasing or licencing technology 

Staff training 

Strategic partnerships with other organisations 

Design activity 

Research and development 

Existing published material 

Prototyping activity 

0 1 2 3 4 5 6 7 8 9 


There was some consistency in the ranking of sources through which the 

technology transfer was obtained between the Bushmasters and the 

Minehunter project (see Table 3). Despite small variations in wording and a 

small number of different categories, there were several sources of technology 

transfer that rated highly for both projects: 

• Strategic partnerships (third for Bushmasters and second for Minehunters) 

• R&D (equal second for Bushmasters and third for Minehunters) 

• Purchasing or licencing technology (fourth for both). 

Survey findings 10

Size of business obtaining 

technology transfer 


Table 3 Sources of technology transfer – Bushmasters vs. Minehunters 

Bushmasters Rank Minehunters 

Prototyping activity 1 Staff training 


R&D 


2 Strategic partnerships 

Strategic partnerships with other organisations 3 Original R&D 

Purchasing or licencing technology 4 Purchasing or licencing technology 

Other 5 Existing published material 

Recruitment or secondment into this business 6 Recruitment or secondment into other 

business 

Bushmaster related Defence offsets agreement 7 Recruitment or secondment into this business 

Secondment of this business' staff to other 

organisations 

Data source: ACIL Tasman Minehunter study, 2002. 

8 Minehunter related offsets 

9 Other 

Of the 12 businesses indicating that they obtained a technology transfer as a 

result of being involved with Bushmaster production and/or TLS, five were 

small businesses (i.e. 5-19 employees), three were ‗larger‘ medium sized 

businesses (i.e. 50-199 employees), two were ‗smaller‘ medium sized businesses 

(i.e. 20-49 employees), one was a micro business (i.e. 1-4 employees) and one 

did not indicate its size. There were no significant business size trends in the 

means of obtaining the technology transfer (see Figure 7). 

Figure 7 Means of obtaining technology transfer by size of business (n=12) 

Secondment of this business' staff to other organisations 

Bushmaster related Defence offsets agreement 

Recruitment or secondment into this business 


Other 

Purchasing or licencing technology 

Staff training 

Strategic partnerships with other organisations 


Research and development 


Prototyping activity 

0 1 2 3 4 5 6 7 8 

Micro Small Medium (low) Medium (high) 


Survey findings 11

Impact of technology 

transfer 


All 12 respondents reported that the technology transfer had positively 

impacted on some aspect of their business (see Figure 8). 

Figure 8 Impact of the technology transfer on... (n=12) 

Other 


Participation in global supply chain 


Market share 




Productivity 


Product range 



Across those 12 respondents experiencing a Bushmaster related technology 

transfer, the impact of the technology transfer was evident on a number of 

business indicators. A summary of those indicators experiencing a significant 

positive impact follows: 

• Level of defence related sales 

− 11 respondents indicated a positive impact 

… Five of these respondents reported a minor to moderate impact 

… Six reported a major positive impact 

• Opportunities for new domestic business 

− Nine respondents indicated a positive impact 

… Six of these respondents reported a minor to moderate impact 

… Three reported a major positive impact 

• Product range 

0 1 2 3 4 5 6 7 8 9 10 11 


Minor to moderate impact Major positive impact 

− Nine respondents indicated a positive impact 

… Five of these respondents reported a minor to moderate impact 

… Four reported a major positive impact 

Survey findings 12


At the other end of the scale, very few respondents reported any positive 

impact of the technology transfer on the level of exports and participation in 

global supply chain, with only four respondents reporting a minor/moderate 

or major impact in each of these potential impact categories. 

Box 1 Working side by side to enhance passenger safety 

Stratos Seating is a true Australian SME success story of Defence products being developed and manufactured in 

Australia. They are a family owned business located in Wetherill Park, New South Wales, providing high performance 

Ballistic seating for the Bushmaster and other niche products into various industry sectors. 

In 1991, the Lewis family purchased the business which was then manufacturing mainly 4WD seating. During the first 

2-3 years they grew their business in the 4WD market and got their first defence project working on the 6WD 

Landrover programme. They then began to grow their business through developing and manufacturing safety seats 

for forklifts which at the time had high accident levels due to drivers attempting to jump from vehicles when they 

were tipping. Stratos was involved in developing seating which had upper side restraints and seat belt restraints 

which allowed the drivers to remain in the vehicle securely when it began to tip. This gained them a market share of 

70% of the forklift seating in Australia. In 1995 they began to develop light truck suspension seats and had a further 

taste of defence work with BAE/Tennix on the Landrovers again for the Bushranger 1 programme. They continued 

into Bushranger 2 again with BAE/Tennix developing seats which, while not truly Ballistic had side facing seats and 

restraints to secure the occupant. 

The development of the Ballistic seats along with Thales for the Bushmaster vehicle really started the Ballistic seating 

growth for the business. Ballistic seats are designed to protect the occupier during vertical acceleration, i.e. when 

the vehicle lifts in the air during a mine blast and the seat attenuates the shock effect on the occupier during the 

acceleration. While Thales had developed the cushioning material of the seat for the attenuation protection, Stratos 

evolved the seat into what it is today. Stratos Seating and Thales developed the seat module as a package to 

incorporate not only the cushioning materials but also the side wings and lateral support. The seats also had to be 

soldier proof and be easily cleaned. The seats offer Australian and other soldiers in the Bushmasters some of the 

highest protection levels in the world. 

Stratos Seating is continually and actively developing their knowledge in the seating and ballistics areas to remain at 

the forefront of the industry. They are gaining expertise in controlling dynamic loadings as well as ballistics and 

control of injury levels. They are manufacturing seats for the ANZAC frigates, which while not to the same levels of 

attenuation, were developed by Stratos using knowledge gained from the Bushmaster programme. They have 

worked on prototyping seats for the M113 Command and Control Variant. They have manufactured seats for the 

Unimog in small quantities through Valir. They have worked on the Mercedes G Wagon programme in developing 

seats for the unprotected modules and are also looking to supply seats for the Thales Bushmaster Single and Dual 

cabs, and also for the associated modules. They have also been involved in development activity for the JLTV 

programme. 

Stratos Seating are in a position to develop and manufacture a wide range of ballistic and other seating for 

Australia’s defence requirements and are able and willing to work in tandem with overseas companies to ensure that 

the best technology is made available to Australian defence and the products are manufactured in Australia. 

Source: Stratos Seating and Thales Australia. 


There was some consistency at the upper end in terms of the impact of the 

technology transfer on different areas of the supplying business between the 

Bushmasters and the Minehunter project. Despite small variations in wording 

Survey findings 13

Impact of technology 

transfer by size of business 


and small differences in the areas that could be affected by either Bushmaster 

or Minehunter participation, common areas of higher ranking included: 

• Product range (second for both Bushmasters and Minehunters) 

• Level of defence related sales (first for Bushmasters and third for 

Minehunters) 

• Productivity (fourth for Bushmasters and first for Minehunters). 

Table 4 Impact of technology transfer – Bushmasters vs. Minehunters. 

Bushmasters Rank Minehunters 

Level of defence related sales 1 Productivity 

Product range 2 Product range 

Opportunities for new domestic business 3 Defence related sales 

Productivity 4 Product/service quality 

Production costs 5 Production flexibility 

Product/service quality 6 Market share 

Production flexibility 7 New export opportunities 

Market share 8 Production costs 

Level of export sales 9 New domestic opportunities 

Participation in global supply chain 10 Export sales 

Opportunities for new export business 11 Non-defence related sales 

Other 12 Other 

Data source: ACIL Tasman Minehunter study, 2002. 

In terms of the impact on different sized businesses, there were no clear trends 

in the impact of the technology transfer by the size of the business (see Figure 

9). 

Survey findings 14


Figure 9 Impact of technology transfer by size of business (respondents reporting minor/moderate 

and major impact) (n=12) 


Other 


Participation in a global supply chain 


Market share 




Productivity 


Product range 


0 1 2 3 4 5 6 7 8 9 10 


Micro Small Medium 

3.3 Use of best practice programs and practices 

The ANZAC Ship and Minehunter Coastal impact studies found that many 

survey respondent‘s involvement in Defence projects had resulted in the 

business taking up a range of programs and practices, which might be 

considered as best practice. 

In this study survey respondents were also asked whether they apply a range of 

programs and practices in their business. A detailed breakdown of respondent 

businesses use of these programs and practices can be found in Figure 10. 

Survey findings 15


Figure 10 Use of various business programs and practices 







Outsourcing/subcontracting 




Quality management 

Source: ACIL Tasman survey of Bushmaster suppliers. 

In summary: 

0 10 20 30 40 50 60 70 80 

Proportion of respondents (per cent) 

• More than three quarters of respondents reported their business has 

implemented quality management (89.6 per cent), quality assurance (85.7 

per cent) and budget forecasting (77.9 per cent) 

• More than half of respondents reported their business has implemented 

formal business planning (70.1 per cent), outsourcing/subcontracting (64.9 

per cent), performance benchmarking (59.7 per cent), business alliances or 

partnerships (57.1per cent), just-in-time supply (53.2 per cent) or formal 

strategic plan (50.6 per cent) 

• Less than half of respondents reported their business has implemented 

process engineering (49.4 per cent) or export market planning (32.5 per 

cent). 

3.3.1 Importance of Bushmaster in implementing some 

programs/practices 

Just under 47 per cent of respondents (36 businesses) considered that their 

involvement with Bushmaster production and/or TLS was important in the 

decision to implement some or all of the programs and practices, with four (5.2 

per cent of all respondents) indicating involvement was important in the 

decision to implement all of the programs and practices (see Figure 11). 

Survey findings 16

Importance of Bushmaster 

involvement in implementing 

individual programs and 

practices 


Figure 11 Importance of Bushmasters in implementing programs and 

practices (n=36) 

0 4 8 12 16 20 24 28 32 36 40 



Yes to all Yes to some 

The remaining survey respondents (41 respondents or 53.2 per cent) did not 

consider that their business‘s involvement with Bushmasters was important in 

the decision to implement any of the programs and practices listed in the 

survey questionnaire. 

The 36 respondents that indicated that their business‘s involvement with 

Bushmasters was important to implementing all or some of the 

aforementioned programs and practices, were asked to indicate how important 

Bushmaster was in implementing individual programs and practices (see Figure 

12). 

For many of these businesses, involvement with Bushmasters played a major 

role in implementing quality programs. In terms of quality management, 22 

(61.1 per cent) indicated that Bushmaster involvement was important in the 

decision to implement, with four (11.1 per cent) indicating that Bushmaster 

involvement was critical. In terms of quality assurance, 22 (61.1 per cent) 

indicated that involvement was important in the decision to implement, with 

six (16.7 per cent) indicating involvement was crucial in the decision. 

For many businesses, Bushmaster involvement also influenced the business‘s 

decision to implement budget forecasting – involvement was important for 18 

(50 per cent) and crucial for four (11.1 per cent). 

Of the remaining programs and practices, 50 per cent or fewer respondents (18 

or less) indicated that involvement with Bushmaster vehicles was important or 

critical to the decision to implement the program. 

Survey findings 17


Figure 12 Importance of Bushmaster involvement in implementing individual programs and 

practices (n=36) 







Outsourcing/subcontracing 




Quality managment 


Importance of Bushmaster 

involvement in implementing 

individual programs and 

practices by size of business 

0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 30 


Important Crucial 

In terms of the types of businesses that Bushmaster had a particular influence 

on the uptake of programs and practices, three did not employ any workers, 

four were micro businesses (i.e. 1-4 employees), 14 were small (i.e. 5-19 

employees), 14 were medium sized businesses of which nine employed 

between 50 and 199 employees and five employed between 20 and 49 

employees, and one was large (i.e. 200 or more employees). 

Despite it being quite clear that Bushmaster involvement had a greater role in 

implementing programs and practices among ‗smaller‘ sized businesses of less 

than 50 workers, there is no strong evidence of any size classification being 

affected more than any other. There are no significant trends in the influence 

of Bushmaster involvement on the implementation of particular programs for 

particular businesses (see Figure 13). 

Survey findings 18


Figure 13 Importance of Bushmaster involvement in implementing individual programs and 

practices by size of business (n=36) 







Outsourcing/ subcontracting 




Quality management 


0 2 4 6 8 10 12 14 16 18 20 22 24 26 28 

3.3.2 Impact of programs or practices on business indicators 

All survey respondents were asked to indicate the impact of the 

aforementioned programs and practices on various business indicators, 

irrespective of the role of Bushmaster in influencing decisions to implement. 

The results are shown in Figure 14. 

Across all business indicators, the programs and practices applied by each 

business had a positive impact (i.e. a minor/moderate or major impact) for 

more than 50 per cent of respondents. At the upper end, the results can be 

summarised as: 

• Sales 

− 92.2 per cent of respondents indicated a positive impact 

… 64.9 per cent indicated a minor/moderate impact 

… 27.3 per cent indicated a major impact 

• Opportunities for business growth 


Not employing Micro Small Medium Large 



… 31.2 per cent indicated a major impact 

Survey findings 19


• Client satisfaction 



… 31.2 per cent indicated a major impact. 

Figure 14 Impact of programs and practices on... (n=77) 


Labour skills base 

Product quality 

Culture of continuous improvement 

Cost structure 

Client satisfaction 

Opportunities for new business growth 

Productivity 

Sales 

At the other end of the scale, business indicators that were less affected by 

programs and practices included: 

• Labour skills base 

− 55.8 per cent indicated a positive impact 

− 40.3 per cent indicated no impact 

• Product quality 

0 10 20 30 40 50 60 70 80 90 100 


Minor/moderate impact Major impact 

− 66.2 per cent indicated a positive impact 

− 31.2 per cent indicated no impact. 

Some programs and practices (although very few) even had a negative impact 

on business indicators, including on: 

• Cost structure – 6.5 per cent indicated a negative impact 

• Productivity – 3.9 per cent indicated a negative impact. 

Survey findings 20


Box 2 Improving outcomes for even the smallest supplier 

Since 2002, micro-sized Bendigo Graphics has manufactured, printed and supplied all instructional and warning 

decals, and manufacturers plates for Bushmaster vehicles. While involvement with Bushmaster vehicles was not the 

first Australian Defence contract for this Bendigo business, it played an important role in multiple facets of the 

business as the company sought to adapt as a supplier to Bushmaster vehicles. 

Implementing new programs and practices 

In order to meet the high standards required by the Bushmaster contract, Bendigo Graphics introduced a number of 

new programs and practices, including budget forecasting, performance benchmarking, and quality assurance and 

quality management. The value of the Bushmaster contract to the company was the key factor in the decision to 

introduce these new practices; the business had worked on smaller Australian Defence Industry and Thales programs, 

however the relative small size of these contracts did not warrant the implementation of new practices. 

Introducing new programs has not come cheaply. Many months, and much of the owner’s free time, has been 

spent understanding and implementing the practices. Once applied the new practices continue to have 

considerable demands, in particular significant amounts of paperwork, which has prevented the carryover of these 

practices to other non-Defence contracts. 

Overall, Bendigo Graphics has found the introduction of these programs and practices to be rewarding. 

Management believes that clients experience greater levels of satisfaction, workers are more skilled, product quality 

and sales have been enhanced, and, perhaps most importantly, there have been opportunities for new business 

growth. 

Efficiency gains 

Further to its involvement with Bushmaster vehicles, Bendigo Graphics has experienced significant efficiency gains, 

with a 20 per cent increase in productivity that the business has managed to sustain for a number of years. Pre- 

planning and production management are two ways the company has achieved these gains. For example, the 

business learnt early in the contract that by doubling production when preparing for an earlier milestone would allow 

it to meet upcoming as well as future milestones, and save re-running the production process for a future milestone. 

Investment in new capital to meet Defence’s quality requirements also contributed to the efficiency gain. 

Customising businesses to meet the demands of Bushmaster 

In addition to implementing a number of operational changes to comply with the Bushmaster vehicle contract, 

Bendigo Graphics purchased specialised printing equipment at a capital cost of more than $50,000. This new 

equipment ensures the product quality is sufficient to meet rigorous Defence standards, as well as allowing the 

business to meet the volume demands of Bushmaster vehicles. Purchased immediately after the contract was 

awarded, Bendigo Graphics recognised that there would be considerable returns on the investment when 

compared to existing manual production. 

Such an investment can present considerable risks for any business, in particular the ability to run the capital at its 

maximum potential. Fortunately, the same machine could be used to supply the next generation of light armoured 

vehicle, as well as completing the company’s other non-Defence contracts. That said, the company believes that 

only a contract with high volume, such as the light armoured vehicle, would allow the business to use the machine at 

its full potential. If future contracts, such as the light armoured vehicle contract, do not arise, Bendigo Graphics 

suggested that the business may need to consider decommissioning the machine, with any potential sale expected 

to incur a significant capital loss. 

Source: Bendigo Graphics. 

Survey findings 21

Exports associated with 

Bushmaster vehicles 

Exports by size of business 

Future ability to export 


3.4 Exports 

In terms of exports, 58.4 per cent of survey respondents (i.e. 45 respondents) 

indicated that they are currently exporters, while 41.6 per cent of respondents 

do not currently export. Of the 45 respondents that do export, seven (15.6 per 

cent) indicated that some of their business‘ exports were developed as a result 

of being associated with Bushmaster vehicles, with a range from less than 

$A1,000 up to $A4 million. As a proportion of total exports, the range was as 

low as 0.8 per cent and as high as 100 per cent. 

Combined, the approximate value of exports developed as a result of being 

associated with Bushmaster vehicles was approximately $A5.2 million in 2007- 

08. 

Small and ‗larger‘ medium sized businesses were the main size businesses 

exporting, with 36.4 per cent of exporters having 50 to 199 employees 

(medium ‗high‘) and 25.0 per cent of exporters having five to 19 employees. 

The number of businesses involved with Bushmasters that are exporting is 

consistent with the businesses involved in the Minehunter and ANZAC Frigate 

projects, with 47 per cent and 59 per cent of businesses (respectively), 

exporting (Tasman Economics, 2002). 

Similarly, the proportion of Bushmaster suppliers that export is far greater than 

is the case with all Australian businesses. Again, this is in line with Minehunter 

and the ANZAC Frigate projects. Based on data from the ABS‘ annual 

business survey, approximately 9.1 per cent of all Australian businesses 

exported goods or services in 2006-07 (ABS, 2009). 

Survey respondents were asked how their involvement with Bushmaster 

vehicles has impacted on their current or future ability to export. No 

respondents indicated a negative impact, 32.5 per cent indicated a positive 

impact and a further 5.2 per cent reporting a strong positive impact (see Figure 

15). 

Survey findings 22

Changes to annual export 

sales since becoming 

involved with Bushmasters 


Figure 15 Impact of Bushmaster involvement on export ability (n=77) 

0 5 10 15 20 25 30 35 40 


Of the 38 respondents whose businesses export, 15 reported there had been a 

change in exports since becoming involved with Bushmaster vehicles. Of these 

14 reported that there has been an increase in their business‘s export sales since 

they commenced involvement, with six reporting a small increase. One 

exporting respondent reported a significant decrease (see Figure 16). 

Figure 16 Changes to annual export sales since involved with Bushmasters 

(n=15) 



Positive Strong positive 

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 


There was a small increase There was a moderate increase 

There was a significant increase There was a significant decrease 

Survey findings 23


Box 3 How a combination of R&D and Defence work leads to new export opportunities 

Bisalloy Steels Pty Ltd, a company of less than 100 people located at Unanderra near Wollongong, is Australia’s sole 

supplier of high hardness steel products for military application. Bisalloy’s internationally recognized capability began 

in 1988 with an order for hull plates to be used in the local construction of two FFG 7 guided missile frigates. In 

cooperation with BHP Port Kembla and the Defence Science and Technology Organisation (DSTO), Bisalloy 

produced HY 80 steel plates, to a US specification, that significantly outperformed the equivalent US manufactured 

steel plate. After five blasts with 15kg of Pentolite high explosive, the Bisalloy HY 80 plate was stretched to the point 

where its thickness had reduced by 29.9 per cent without fracturing. The specification called for only 16 per cent 

deformation without fracture. Australia’s four US built FFG 7 frigates were subsequently retrofitted with the Bisalloy HY 

80 plate. Bisalloy produced approximately 1000 tonnes of steel for the FFG program. 

At the end of the 1980s Bisalloy was contracted to supply hardened steel plate for the Collins class submarines. 

Working again with BHP Port Kembla and the DSTO, Bisalloy successfully produced the BIS 812EMA plate; a weldable, 

micro-alloyed, high yield stress steel with excellent low temperature impact properties that had, up until then, been 

an experimental Swedish product in its embryonic developmental stage. Bisalloy went on to supply more than 8,000 

tonnes of steel over 15 years for the submarine program. 

During the late 1990s, the development of a new breed of protected infantry mobility vehicle under Project 

Bushranger, led to the design of the Bushmaster IMV. The vehicle had to be capable of withstanding mine blasts of 

up to 10kg of TNT and side impact from high velocity small arms ammunition. For the Bushmaster vehicle, Bisalloy, in 

cooperation with DSTO, created new high hardness armour (HHA) plate from specially produced BlueScope steel. 

The ‘green feed’ product from BlueScope Steel is subsequently quenched and tempered to produce a grade of 

armour plate rated to the highest levels of performance. Since 1993, Bisalloy has produced over 3,500 tonnes of steel 

for the Bushranger program. 

The science, technology and manufacturing processes developed for the production of these low sulphur, micro 

alloyed steels has flowed on to the production of all Bisalloy steel products, including for commercial purposes. 

Bisalloy’s Quality Assurance system meets the requirements of ISO 9001, with stringent quality controls developed in 

order to qualify the performance of materials being used in commercial or military critical products. In 2008 the 

company’s defence business in armour plate accounted for 14 per cent of all steels produced, or about 6,000 

tonnes. The majority of this output was for export to the USA, Middle East and Asia. Bisalloy has established two joint 

ventures; one in Indonesia and the other in Thailand, to assist with the sale of commercial and military grade steel 

into Asian markets. Another joint venture agreement in China is being considered. Foreign governments in the USA, 

India, the Middle East and Asia have qualified Bisalloy’s armour plate for use by their militaries and exports now far 

exceed domestic orders. Bisalloy is also an invitee on international working groups and panels defining standards for 

the next generation of Ultra High Hardness steel for armour applications. 

Bisalloy is in a position to design, develop and manufacture a wide range of high-hardness steels for Australia’s 

armour plate needs. For 25 years the Bisalloy story has been one of working in tandem with Australian steel 

producers, defence scientists, international organisations and manufactures of military ships and vehicles, to produce 

some of the best armour plate products in the world. 

Source: Bisalloy and Thales Australia. 

Of the 15 respondents reporting any change in exports (i.e. positive or 

negative, but not relative stability), eight indicated that improved programs and 

practices had a positive impact on the change in exports, with seven indicating 

productivity improvements producing a positive impact (see Figure 17). 

Survey findings 24


Figure 17 Impact of different factors on changes in exports (n=15) 

Related defence offsets 

Offshore investments 

Technology transfer 

Demonstration effect 

New business links or alliances 

Productivity improvements 

Improved programs and practices 


The demonstration effect of being associated with a Defence project had an 

impact on five respondent‘s exports. At the other end of the scale, related 

defence offsets did not have an impact on any respondents it applied to, and 

offshore investment only had a positive impact on one respondent, with nine 

respondents indicating it had no impact. None of the factors identified in the 

survey questionnaire were considered to have had a negative impact on change 

in exports. 

3.5 Productivity changes 

0 1 2 3 4 5 6 7 8 


A business‘ productivity changes if it uses more or less inputs to produce a 

given level of services. Inputs include tangible items such as raw materials, 

machinery and land, and less tangible items such as labour hours. While 41 

respondents reported that their businesses‘ productivity remained relatively 

stable as a result of being involved with Bushmasters, 34 indicated a 

productivity increase, the extent of which is shown in Figure 18. 

Only one respondent reported a decrease in productivity, which was 

considered to be a small decrease. This respondent was contacted to confirm 

the reported productivity outcome. The respondent clarified that the decline in 

productivity was not firm wide but rather only related to Bushmaster material, 

and that the decline was due to the additional testing and special handling and 

delivery procedures that are required to be carried out on the Bushmaster 

product. 

Survey findings 25

Productivity change by size 

of business 

Magnitude of productivity 

changes 

Ability to sustain productivity 


Figure 18 Change in productivity since Bushmaster involvement (n=77) 

0 10 20 30 40 50 60 70 

Slight decrease Relatively stable Slight increase Moderate increase Substantial increase 

Note: One respondent did not answer the change in productivity question and the no response has been treated as 

“Remained relatively stable”. 


Of the 35 respondents reporting a productivity change (up or down), nearly 

half (48.6 per cent) reported a slight increase in productivity as a result of being 

involved with Bushmasters, 34.3 per cent a moderate increase and 14.3 per 

cent a substantial increase. As noted above, the one business which reported a 

decrease in productivity considered the decrease only related to the 

Bushmaster activity and that this decrease was in the order of 1-1.9 per cent. 

Of the businesses reporting any change in productivity, most (31.4 per cent) 

were ‗larger‘ medium sized businesses (i.e. 50-199 employees) and 28.6 per cent 

were small businesses (i.e. 5-19 employees). 

The magnitude of the change in productivity reported by the 34 respondents 

whose businesses experienced a positive change in productivity varied. At the 

lower to medium end of the scale, there was a fairly even distribution of 

respondents. Nine respondents (26.5 per cent) reported a change of 

magnitude less than one per cent; 10 respondents (29.4 per cent) reported a 

change of magnitude between one and two per cent, and eight respondents 

(23.5 per cent) reported a change of magnitude between two and three per 

cent. Of the remaining respondents, seven (20.6 per cent) reported a changed 

in magnitude of greater than three per cent. 

Of the seven businesses reporting a three per cent of more change in 

productivity, the magnitudes reported varied considerably - five, seven, 20, 35 

and 80 per cent were reported. One respondent did not indicate the 

magnitude of the increase, while another did not know. 

Of the 34 respondents recording a positive change in productivity, all bar one 

respondent reported that the change in productivity had been sustained. The 

last responded indicated that the change had not been sustained. 

Survey findings 26


3.6 Employment impact 

Survey respondents were asked if their business was required to take on any 

more full time, part time, casual or contract workers as a result of being 

involved with Bushmaster vehicles. Of the survey respondents, only 20 

reported that their business took on more workers. 

The frequency distribution for the numbers of employees taken on at various 

points of involvement is shown in Figure 19. Generally: 

• Lower numbers of additional workers (i.e. ranging between zero and four 

additional workers) were taken on for Bushmaster-related employment in 

the first year of the business‘s involvement with Bushmasters 

• Larger numbers of additional workers (i.e. ranging between two and nine) 

were taken on for Bushmaster-related employment in the peak year of the 

business‘s involvement with Bushmasters 

• A larger but greater spread of additional workers had been taken for 

Bushmaster-related employment by 2007-08. 

Given that upper limits and averages were used by ACIL Tasman to assist in 

determining the number of additional workers, these following total figures 

provide a best estimate, and very likely lower limit, of additional workers in all 

companies as a result of Bushmaster involvement: 

• First year – 61 additional workers 

• Peak year – 149 additional workers 

• By 2007-08 – 173 additional workers. 

Survey findings 27


Figure 19 Extra workers at different stages of involvement in Bushmasters 

(n=20) 

Frequency 

Frequency 

Frequency 

7 

6 

5 

4 

3 

2 

1 

0 

7 

6 

5 

4 

3 

2 

1 

0 

7 

6 

5 

4 

3 

2 

1 

0 

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 40 

Note: Mid-point values or limits were used to determine the number of extra workers when respondents provided a 

range or a number that could not be easily placed into a histogram. Extra workers in first year of involvement: 

upper boundary 4 workers recorded instead of 3-4 workers; 2 workers recorded used instead of 1-2 workers; 8 workers 

recorded instead of 6-10 workers; and 8 workers used instead of 8-10 workers. Extra workers in peak year of 

involvement: 5 workers recorded instead of 4-5 workers; 9 workers recorded instead of 8-10 workers; 8 workers 

recorded instead of 5-10 workers. Extra workers in 2007-08: 7 workers recorded instead of 5-8, 20 recorded instead 

of 20+. 


Extra workers in first year on involvment 

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 40 

Extra workers in peak year of involvement 

0 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 40 

Extra workers in 2007-08 

Survey findings 28

How Bushmaster involvement 

improves capability to 

supply DoD contracts 


3.7 Capability to supply Defence or its contractors 

Involvement with Bushmasters has the capacity to improve a business‘s 

capability to supply the DoD or its contractors (such as Thales). 

Nearly two thirds of survey respondents (51 respondents or 66.2 per cent) 

indicated that being involved with Bushmasters had improved their business‘s 

capability to supply DoD or its contractors, while 26 (33.8 per cent) said 

involvement did not improve their ability to supply. 

The 51 respondents indicating that Bushmasters had improved their ability to 

supply DoD or its contractors reported improved capabilities in a range of 

areas (see Figure 20). 

Figure 20 As a result of being involved in Bushmaster vehicles, the business... (n=51) 

Can supply defence equipment/services at a lower cost than … 

Can provide a better quality defence product or service than … 

Can supply the DoD or its contractors at a faster rate than … 

Can work in/with new areas of defence related technology 

Can now assist in the through life support of Bushmaster … 

Has the capacity to help supply DoD's capability requirements 

Has the resources to help supply DoD's capability requirements 

Has the knowledge to supply DoD's capability requirements 


0 10 20 30 40 50 60 70 80 90 100 


For most areas, the respondents largely agreed to some degree with the 

statement posed to them. In summary: 

• At least 70 per cent agreed with the following statements that the business: 

− Has the knowledge to supply DoD‘s capability requirements (74.5 per 

cent) 

… A further 21.6 per cent strongly agreed 

− Has the resources to supply DoD‘s capability requirements (70.6 per 

cent) 


− Can work in/with new areas of defence related technology (70.6 per 

cent) 


Agree Strongly agree 

Survey findings 29

Box 4 Improving Defence capabilities 


− Can supply the DoD or its contractors at a faster rate than previously 

(70.6 per cent) 

− A further 11.8 per cent strongly agreed. 

For some statements there was considerable disagreement that the business: 

• Can supply defence equipment/services at a lower cost than previously 

− 49.0 per cent disagreed 

… 41.2 per cent agreed and 7.8 per cent strongly agreed 

• Can provide a better quality defence product or service that previously 

− 21.6 per disagreed 

… 58.8 per cent agreed and 19.6 strongly agreed. 

Able Industries Engineering (AIE) has supplied numerous Australian Defence projects (including Minehunter vessels 

and ANZAC Frigates). However, its ties to the Bushmaster vehicles propelled it forward and presented it with new 

opportunities as a preferred Defence supplier. 

Since 2000, AIE has supplied various components and services to Bushmaster vehicles, primarily ballistic armour, 

lockers, compartments, as well as through life support for these inputs. The nature of the product it supplies has 

resulted in AIE obtaining several technology transfers, most significantly through design and prototyping activities, 

and R&D. With each variation on the Bushmaster vehicle, AIE is required to research and develop best cost and 

operability solutions, resulting in a culture of continuous improvement to meet both the needs of Defence and the 

purpose of the vehicles. 

The impact of these technology transfers has been widespread in the business. However, the areas most significantly 

affected have been product and service quality, new domestic business opportunities and, to a considerable 

extent, the level of defence related sales. 

The company’s management pointed out that initially, there was a considerable learning curve within AIE to meet 

the stringent requirements of a long-term Defence project. However, the business’s persistence to learn and develop 

has equipped it with the right systems, equipment, experience, knowledge, tools and skill sets to not only meet the 

expectations and quality requirements of Defence, but also to make it more prepared to undertake other complex 

projects, including Defence projects. 

The efforts of AIE have not gone unnoticed. The company’s management believes that being linked to the 

Bushmaster vehicles has been a glowing reference for the business, and placed it in an excellent position to 

participate in other Defence projects. Already, AIE’s product and operations, as well as an association with the 

Bushmaster vehicles, has resulted in the company being awarded the Land Rover Safety Improvement contract for 

Defence, which requires refurbishing the existing fleet of military Land Rover vehicles with new components to bring 

them up to world class standards and provide them with enhanced capabilities and improved occupant safety. 

AIE anticipates that lessons learnt, and procedures and practices already in place, has placed it in excellent stead 

to support the proposed light armoured vehicles. Pre-planning will ensure the business is able to promptly react to 

any new contracts, and move forward at a rapid pace without compromising Defence standards. 

Source: Able Industries Engineering. 

Survey findings 30


4 Economy wide impacts of 

BUSHRANGER 

The previous chapter considered the firm level impact caused by involvement 

with Bushmasters, taking into consideration factors such as employment, 

technology transfers, implementation of programs and practices, exports, 

productivity and the ability to supply other DoD capability requirements. 

This chapter considers the impact of manufacturing and supporting 

Bushmasters in Australia on the wider economy, in particular the impact on the 

Bendigo, Victorian and national economy. 

4.1 Estimating the economic impact 

The main factors that need to be considered when analysing the economic 

impacts of a major project such as the Bushmasters include: 

• The direct and indirect contribution to the economy as a result of the 

activities associated with the project 

• Any crowding out implications, as resources are potentially diverted from 

other productive activities to undertake the project being analysed 

• Any productivity effects generated as a direct result of the project activities, 

particularly any enduring productivity changes or productivity spillovers to 

other activities not directly associated with the project 

• Any changes to the factors of production in the economy 

• Any welfare implications associated with changes in terms of trade or 

foreign income transfers 

• Whether there is a dynamic element to the size of any of the above effects 

(due to different phases of the project for example). 

Figure 21 shows the components to assess economic impact graphically. Some 

of these effects may be negligible while others may be very significant. An 

understanding of the effects helps determine the most appropriate tool(s) for 

the analysis. 

Economy wide impacts of BUSHRANGER 31


Figure 21 Estimating the economic impact of a project 

Source: ACIL Tasman 

Value added 

Direct 

economic 

contribution 

Economic output impact 

(GDP) 

Taxes less 

subsidies 

Total economic impact 

(GNP) 

Supply chain 

impacts 

Terms of 

trade effects 

Crowding out 

impacts 

Indirect 

economic 

contribution 

4.1.1 Computable general equilibrium modelling 

Foreign income 

transfer effects 

Productivity 

impacts 

Factors of 

production 

impacts 

For some projects, static estimates of the direct economic contribution and 

supply chain implications can be obtained through the use of Input-Output (I- 

O) multipliers. Estimating the size of other components using multiplier 

techniques is either not possible or very complex, as is estimating the economic 

impacts through time. 

In contrast, computable general equilibrium (CGE) models are able to estimate 

all of the components shown in Figure 21, with dynamic CGE models able to 

estimate the impacts through time. For this reason Tasman Global (ACIL 

Tasman‘s dynamic CGE model) has been used to model the economic impact 

of the production of the Bushmasters in Bendigo and the provision of TLS. 

Some background detail on the Tasman Global model is presented in 

Appendix B. 

CGE models, such as Tasman Global, provide a representation of the Australian 

economy set in an international trading context using a ‗bottom-up approach‘. 

That is, the model starts with individual markets, producers and consumers, 



and builds up the system via demands and production from each component. 

When an economic shock or disturbance is applied to the model, each of the 

markets adjusts to a new equilibrium according to the set of behavioural 

parameters which are underpinned by economic theory and econometric 

estimation. 

Consistent with the previous analysis of the impact of the ANZAC Ship and 

Minehunter Coastal projects, this current analysis has considered the economy 

wide impacts of the DoD‘s decision to source the Bushmasters from an 

Australian supplier (and conduct TLS onshore) rather than purchase a similar 

vehicle at a similar cost from overseas. 

However, in the case of the BUSHRANGER Project, the analysis involves 

more extensive analysis of state and regional economic impacts in addition to 

the national economic impacts. 

4.2 Developing the model’s database 

A key advantage of Tasman Global is the level of detail in the database 

underpinning the model. The model database is derived from the Global Trade 

Analysis Project (GTAP) database for the year 2001, as this database reflects 

the Australian and world economy at around the time the Bushmasters 

commenced production. The global database is fully documented and publicly 

available, and contains complete bilateral trade information, transport and 

protection linkages among regions for all GTAP commodities. Tasman Global 

builds on the GTAP database by adding explicit representation of the states 

and territories of Australia. 

The model‘s database has been further developed for the current project in 

order to identify the Bendigo region separately in the database. 

The Bushmasters, and other Bushmaster variant spin off sales and TLS, have 

also been identified in the database as separate industries. In developing these 

industries we have relied extensively on cost and sales data provided by Thales 

Australia. 

Thus for this project the model database has been aggregated to: 

• Four economies, namely the Bendigo region, the rest of Victoria, the rest 

of Australia, and the rest of the World 

− The Bendigo region was disaggregated from the Victorian economy by 

ACIL Tasman for this project. 

… The Bendigo region corresponds to the Loddon statistical division 

as defined by the ABS (see Figure 22). 

• 30 industries/commodities plus the Bushmaster domestic, export and TLS 

industries. 



The aggregation was chosen to provide the maximum detail possible for the 

key industries in the Bendigo region and Victorian economies. 

Figure 22 Loddon statistical division of Victoria 

Data source: Australian Bureau of Statistics 2006 Census, 

http://www.abs.gov.au/websitedbs/D3310114.nsf/home/census+data?opendocument?utm_id=LN 

4.3 The reference case and project scenario 

To isolate the economic implications of a project, the outputs from a CGE 

model are typically reported as deviations between a scenario with the new 

project, and a scenario without the project. That is, the modelling results report 

changes relative to what would have happened without the investment being 

evaluated. These results are then converted to units of value, for example 

dollars of GDP or the number of full time jobs. 

Consistent with the previous Minehunter Coastal and ANZAC Ship analyses, 

the reference case has been developed to reflect the current state of the 

Bendigo, rest of Victoria and rest of Australia economies. This historical 

economic environment is modelled with the Bushmasters in place under the 

production scenario outlined in Table 1 on page 3. 

Projections of the economy outcomes from 2009 to 2016 were also modelled 

based on Commonwealth Treasury forecasts and projections for the Australian 

economy up to the year 2016. This national growth was then broken down to 

reflect the growth in the Bendigo region, the rest of Victoria and the rest of 

Australia using ACIL Tasman assumptions for future regional changes in: 



• Population – particularly changes in the number of people of working age 

(15 years old and over) 

• Workforce participation rates – defined here as the average number of 

hours worked in the labour force by all people of working age. This 

measure encompasses changes in participation rates by age by gender, the 

unemployment rate and average hours worked 

• Growth in labour productivity – defined here as the average output per 

hour worked. 

The assumptions underpinning these regional projections are set out in 

Appendix B, section B.2, however one assumption, the full employment 

assumption, is discussed in detail here. 

4.3.1 The full employment assumption 

As their name implies, CGE models ensure that all markets in the model clear 

as the model moves from equilibrium to equilibrium. Generally, price changes 

are the primary mechanism for clearing markets. However, in reality some 

markets, particularly labour markets, tend to be ―sticky‖ (that is, prices changes 

take a number of years to adjust), which can produce near-term 

unemployment. In periods of low unemployment, modellers typically assume 

that the economic changes do not raise unemployment above the so-called 

natural rate of unemployment in the long term. Any shifts in the demand for 

labour are assumed to be offset by changes in real wages sufficient to prevent 

the emergence of unemployment above the natural rate. This is the ―full 

employment assumption‖. This assumption can be relaxed over the short to 

medium term. 

However, the Bendigo region has traditionally experienced a higher level of 

unemployment than the rest of Victoria and the rest of Australia (see Figure 

23). Given Bendigo‘s higher unemployment level is a historical fact, it has been 

taken into account in the development of the business as usual (BAU) 

reference case. This issue is discussed in more detail in Appendix B. 



Figure 23 Historical annual average unemployment rate by region 

9 

8 

7 

6 

5 

4 

3 

2 

1 

% 

1999 2001 2003 2005 2007 2009 

Bendigo region Victoria Australia 

Note: Calendar year averages 

Data source: ABS Detailed Labour Force by region statistics, catalogue number 6291.0.55.001 

4.4 Shocking the reference case – a hypothetical 

scenario 

ACIL Tasman‘s model was shocked to represent an alternative scenario where 

the DoD hypothetically had elected to import vehicles similar to the Bushmasters 

rather than contract to produce (and support) the vehicles in Australia. Hence, 

in the absence of the Australian BUSHRANGER Project, no Bushmasters are 

produced or supported in Australia for either the domestic or export markets. 

Further, under this hypothetical scenario the productivity benefits directly 

associated with supplier businesses involvement with the Bushmasters are lost 

to the economy. This loss of productivity has been modelled as a loss of 

productivity for the non-Bushmaster activity undertaken by those suppliers 

reporting a change in productivity/efficiency as a result of their businesses 

involvement in the BUSHRANGER Project. 

It is the difference between this business as usual reference case and the 

hypothetical scenario where no Bushmasters are manufactured or supported 

that demonstrates the impact of the project on the Australian economy (Figure 

24). 


Bushmaster production 

– Impact on Australian GDP 


Figure 24 Illustrative Bushmaster scenario analysis using Tasman Global 

Percentage change 


4.5 Shocking the reference case – actual scenario 

The preceding section discussed the hypothetical scenario, whereby no 

Bushmasters are produced or supported in Australia for either the domestic or 

export markets. This section goes on to report on the relevant shocks for each 

scenario modelled in this report. Each scenario in this Chapter is presented in 

terms of production and TLS. 

Appendix C presents annual contributions to GDP, GSP, GRP, GNP and 

employment from the production and TLS activity in tabular form. 

4.5.1 Gross Domestic Product 

Scenario where Bushmasters are 

manufactured and supported in 

Australia (i.e. BAU reference case). 

Scenario where no Bushmasters 

are manufactured and supported 

in Australia. 

2002 2016 

CGE modelling demonstrates that the Bushmasters have had a significant 

effect on the Australian economy, but most notably in the Victoria and 

Bendigo region economies. For DoD capital expenditure of $770 million 

($2008) to purchase new Bushmasters, the Australian economy will have 

enjoyed an additional $998 million ($2008) of GDP over the period 2002 to 

2016. 

The peak year of this positive impact will be 2011, when Australia‘s GDP will 

be just under $108 million ($2008) higher than might have occurred in the 


– Impact on Bendigo GRP 

and Victorian GSP 


event that the alternative vehicles had been purchased from a supplier located 

outside of Australia. After this time, production of Bushmasters decline as the 

contract to supply the DoD has been finalised. 

With respect to the other areas, Bendigo would have experienced an additional 

$573 million of Gross Regional Product (GRP), the rest of Victoria an 

additional $394 million of GRP. These would combine to provide the whole 

of Victoria with an additional $967 million of GSP. 

The direct and indirect contribution of the Bushmasters to all regions is shown 

in Figure 25. 

Figure 25 Direct and indirect contribution of Bushmaster production to GDP, GSP and GRP ($2008 

million) 

120 

100 

80 

60 

40 

20 

$m 



2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

Through life support 

– Impact on GDP, GSP and 

GRP 

120 

100 

80 

60 

40 

20 

$m 



2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

This positive outcome for GDP, GSP and GRP is derived from the 

production of the Bushmaster vehicles for the DoD, as well as the follow on 

production of Bushmaster variants for Forestry South Australia and for export. 

In the absence of the DoD‘s decision to purchase the Bushmasters in 

Australia, it is highly unlikely that these additional Bushmaster vehicles would 

have been produced. The small productivity improvement enjoyed by some 

Bushmaster suppliers as a result of their involvement in the project also makes 

a contribution to this net outcome. 

TLS of the Bushmaster vehicles, which commenced in 2004 has also 

contributed to Australian GDP. Once TLS is factored into the analysis, 

Australia‘s GDP, over the period 2004 to 2016, rises by an additional $133 

million ($2008). Thus over the period 2002 to 2016 the economy will have 

enjoyed an additional $1,131 million ($2008) of GDP (from production and 

TLS) as a result of the DoD‘s decision to purchase and service Bushmasters 

domestically, rather than contracting production and servicing of an alternative 

vehicle to an overseas supplier. 



There is negligible impact of TLS in Bendigo - virtually all of the GDP benefits 

of the TLS activity fall outside of Victoria. This is because the bulk of the TLS 

work is undertaken in Queensland. The whole of Victoria will only receive an 

additional $57 million of this GSP over the period. 

The direct and indirect contribution of Bushmaster production and TLS to all 

regions is shown in Figure 26. 

Figure 26 Direct and indirect contribution of Bushmaster production and TLS to Australian GDP, 

Victorian GSP and Bendigo GRP ($2008 million) 

140 

120 

100 

80 

60 

40 

20 

$m 

TLS 

Production 



2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

120 

100 

80 

60 

40 

20 

$m 



2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 

The contribution of TLS to GDP increases overtime as the number of 

Bushmaster vehicles in the ADF fleet increases to its maximum, with the 

delivery of the final Bushmaster to the DoD in 2011. Also a provision for a 

slight increase in the amount of TLS required as the fleet ages results in the 

final year modelled (2016) providing the highest contribution to GDP from 

TLS. In 2016, TLS has been estimated to contribute $20 million to GDP, 

compared to a GDP contribution of $15 million in 2013. 

Summary results on the impact of Bushmaster production and TLS in each 

region can be found in Box 5. 



Box 5 GRP, GSP and GDP impact of manufacturing and supporting Bushmaster vehicles in 

Australia 

GRP, GSP and GDP values are estimates for production plus TLS. 

Bendigo 

• Between 2002 and 2016, total GRP is $573 million higher. Key annual GRP point estimates include: 

– 2009: $68.3 million higher 




• Between 2002 and 2016, total GRP is $452.6 million higher. Key annual GRP point estimates include: 





• Between 2002 and 2016, GSP is $1.025 billion higher. Key annual GSP point estimates include: 




Australia 

• Between 2002 and 2016 GDP is $1.131 billion higher. Key annual GDP point estimates include: 

– 





Source: ACIL Tasman. 


4.5.2 Gross National Product 

Gross National Product (GNP) is another measure of economic performance. 

On top of GDP, it includes net foreign investment income (i.e. plus income 

earned by residents from investments undertaken overseas minus income 

earned by overseas residents within the domestic economy). It is perhaps not 

as commonly used as GDP, hence we discuss it in slightly less detail. 

Australia‘s GNP also benefits from Bushmasters being produced in Australia. 

Manufacturing new Bushmaster vehicles in Australia rather than importing 

alternative vehicles results in an additional $1,135 million (in $2008) of GNP 

over the period 2002 to 2016. Consistent with the GDP results, the peak rise in 

GNP occurs in 2011 ($126 million [in $2008] higher). 




TLS of the Bushmaster vehicles over the period 2004 to 2016 increased GNP 

by an additional $179 million ($2008). In 2016, the final year modelled, GNP is 

$24 million ($2008) higher as a result of the decision to conduct TLS in 

Australia rather than importing the services. 

The direct and indirect contribution of Bushmaster vehicle production and 

TLS to Australian GNP is shown in Figure 27, with summary results on the 

impact of Bushmaster production and TLS shown in Box 6. 

Figure 27 Direct and indirect contribution of Bushmaster production and TLS to Australian GNP 

140 

120 

100 

80 

60 

40 

20 

$m 

A. Australian GNP as a result of production B. Australian GNP as a result of production and TLS 

2002 2004 2006 2008 2010 2012 2014 2016 


Box 6 GNP impact of manufacturing and supporting Bushmaster vehicles in Australia 

GNP values are estimates for production plus TLS. 

Australia 

• Between 2002 and 2016 GNP is $1.315 billion higher. Key annual GNP point estimates include: 

– 







4.5.3 Employment 

160 

140 

120 

100 

80 

60 

40 

20 

$m 

TLS 

Production 

2002 2004 2006 2008 2010 2012 2014 2016 

Bushmaster production has a positive impact on employment — not only 

directly through Thales' employment, but also indirectly by producers 

supplying of goods and services into the Bushmaster supply chain or supplying 

the increased consumption generated as a result of the additional wage and 

salary income in the economy. For example, nationally in 2009 the Bushmaster 

production generated 987 full time equivalent (FTE) jobs, which would have 



been lost to the economy in the absence of the BUSHRANGER Project (see 

Figure 28). 

It should be noted that the increase in FTE jobs as a result of the Bushmasters 

is higher in the Victorian economy than in the Australian economy as a whole. 

For example, in 2009 Victorian FTE employment was 1,116 FTE jobs higher 

than would have been the case had the DoD elected to purchase alternative 

vehicles from a foreign supplier. Of these 1,116 FTE jobs, 882 were located in 

the Bendigo region, with the remaining 234 located in the rest of Victoria. On 

the other hand, Australian FTE was 987 FTE jobs higher in the same year. 

Fundamentally, the production of the Bushmasters increases the demand for 

labour relative to the business as usual reference case. The increased demand 

for labour is principally located in Bendigo and the Rest of Victoria. This 

demand is met by an increase in the supply of local labour through lower 

unemployment and increased participation induced by higher real wages 

(relative to the business as usual reference case), with the remainder met from 

the Rest of Australia via migration induced by the higher real wages. The 

movement of labour from the Rest of Australia to Victoria (relative to the 

business as usual reference case) is an example of the economic activity 

generated by the Bushmaster project ‗crowding out‘ other economic activity. 

Figure 28 Direct and indirect contribution of Bushmaster production to FTE employment 

1,200 

1,000 

800 

600 

400 

200 

Jobs 



2002 2004 2006 2008 2010 2012 2014 2016 

1,400 

1,200 

1,000 

800 

600 

400 

200 

Jobs 



2002 2004 2006 2008 2010 2012 2014 2016 

It can be seen in Figure 28 that the most positive impact on FTE employment 

occurs in 2011. This is the final year of the production of the Bushmasters. 

After this period production continues at a lower rate to service the export 

market. 

Summary results of the impact of Bushmaster vehicle production on FTE 

employment (total and at key points in the production timeline) can be found 

in Box 7. 



Box 7 Employment impact of manufacturing Bushmasters in Australia 

FTE job values are estimates for production only. 

Bendigo 

• Between 2002 and 2016, on average an additional 561 FTE jobs are developed or maintained per year. Key 

annual point estimates include: 

– 2009: 882 FTE jobs 

– 2011: 895 FTE jobs 

– 2016: 392 FTE jobs 




– 2009: 234 FTE jobs 

– 2011: 238 FTE jobs 

– 2016: 163 FTE jobs 




– 2009: 1,116 FTE jobs 

– 2011: 1,133 FTE jobs 

– 2016: 555 FTE jobs 

Australia 



– 2009: 987 FTE jobs 

– 2011: 1,003 FTE jobs 

– 2016: 482 FTE jobs 



TLS adds to the positive employment outcome for the national economy. For 

example, in 2009 the economy‘s FTE employment is 48 FTE jobs higher than 

in the absence of TLS. Thus in total in 2009 the economy enjoys 1,035 more 

FTE jobs (i.e. FTEs in production plus FTEs engaged in TLS) than in a 

situation where the alternative vehicles were purchased overseas and then 

serviced by a foreign TLS provider. 

The contribution of TLS to FTE jobs increases over time as the number of 

Bushmaster vehicles in the ADF fleet increases. For example, in 2016, the last 

year modelled for this study, TLS will generate a total of 111 additional FTE 

jobs in the Australian economy (see Figure 29). 



Figure 29 Direct and indirect contribution of Bushmaster production and TLS to FTE employment 

1,200 

1,000 

800 

600 

400 

200 

$m 

TLS 

Production 



2002 2004 2006 2008 2010 2012 2014 2016 

1,400 

1,200 

1,000 

800 

600 

400 

200 

Jobs 



2002 2004 2006 2008 2010 2012 2014 2016 


Impact on GDP 

Impact on GSP and GRP 


5 Potential impact of constructing 

PMV-L in Australia 

CGE modelling has also been undertaken to assess the likely impact of 

constructing the PMV-L in Australia rather than the DoD importing an 

equivalent vehicle from a foreign supplier. 

The analysis of this scenario essentially involved the development of a likely 

cost structure for the construction of the PMV-Ls in Thales Australia‘s 

Bendigo plant. This cost structure has largely been based on work done by 

Thales in response to the LAND 121 Phase 4 Request for Proposal submitted 

in September 2009. A third model scenario was run through Tasman Global to 

identify the economic contribution of the PMV-Ls domestic construction 

compared to the alternative of an imported vehicle. 

It should be noted that in the scenario modelled, no account has been made of 

the potential for any of the inputs to the imported vehicle being provided by 

Australian suppliers. Further the analysis has only focused on the likely impact 

of the production of 1,300 PMV-Ls in Australia. The analysis has not 

examined the likely impact of further Australian orders, potential export 

orders, TLS for the PMV-Ls or any additional productivity improvements 

which might arise as a result of the program. The results therefore represent 

the minimum potential impacts of a domestic PMV-L production program. 

Appendix D presents annual contributions to GDP, GSP, GRP, GNP and 

employment from the production activity in tabular form. 

5.1.1 Gross Domestic Product 

CGE modelling indicates that that the construction of the PMV-Ls in Australia 

will positively impact on Australia‘s GDP. As was the case for production of 

the Bushmasters, the bulk of the growth in GDP will be generated in the 

Victorian economy, in particular in the Bendigo region. 

Over the five year production phase, Australian GDP will be a total of $261 

million ($2008) higher than in the absence of the PMV-L project. The peak 

year of this GDP impact will be 2015 (see Figure 30), in which Australia‘s 

GDP will be $64 million ($2008) higher than might occur in the event that the 

DoD elects to purchase the equivalent vehicles from an offshore supplier. 

With respect to the other regions, over the five year production period 

Bendigo would experience an additional $199 million ($2008) of GRP, while in 

Victoria GSP will increase by an additional $232 million ($2008). The impact 

on annual GSP and GRP ramps up to peak in 2015 when: 

Potential impact of constructing PMV-L in Australia 45


• Bendigo GSP is $48 million ($2008) higher 

• Victorian GSP is $56 million ($2008) higher (see Figure 30). 

As production declines in the final year of the five year build program, income 

growth declines slightly. Thus in 2016, compared to the alternative import case 

outcomes in Bendigo: 

• GRP is $43 million ($2008) higher 

• GSP is $50 million ($2008) higher 

• GDP is $59 million ($2008) higher. 

Figure 30 Direct and indirect contribution of PMV-L production in Australia 

to Australian GDP, Victorian GSP and Bendigo GRP ($2008 

million) 

70 

60 

50 

40 

30 

20 

10 

$m 

Australia 




2012 2013 2014 2015 2016 

This positive outcome for GDP is only derived from the production of the 

PMV-L vehicles. No account has been made for any future follow on work 

which might arise should foreign Governments decide to submit orders for 

PMV-L vehicles (as has been the case for Bushmasters). In addition, no 

provision has been made for any productivity improvements which might arise 

as a result of production being undertaken in Australia. 

5.1.2 Gross National Product 

Australia will enjoy higher GNP as a result of a decision to produce the PMV- 

Ls in Australia, rather than import similar vehicles from offshore. Over the five 

year production phase Australian GNP would be a total of $327 million 

($2008) higher than in the absence of the PMV-L project. The peak year of this 

GNP impact will be 2015; in that year Australia‘s GNP would be $79 million 

($2008) higher (see Figure 31). 

Potential impact of constructing PMV-L in Australia 46


Figure 31 Direct and indirect contribution of PMV-L production in Australia 

to Australian GNP ($2008 million) 

90 

80 

70 

60 

50 

40 

30 

20 

10 

$m 

41 


5.1.3 Employment 

The production of the PMV-L vehicles in Australia will also have a positive 

impact on employment. For example, nationally in 2012, PMV-L production 

could generate an additional 363 FTE jobs, increasing to 614 FTE jobs in 

2014. On average over the five year production period, the project would 

create 523 FTE Australian jobs. The majority of these FTE jobs would be 

created in the Bendigo region. 

The peak years for job creation are 2014 and 2015, with, approximately: 

• 573 FTE jobs created in Bendigo 

• 669 FTE jobs created across Victoria 

• 614 FTE jobs created nationally (see Table 5). 

Again, the differential between Australian and Victorian jobs created would be 

caused by the production of PMV-Ls crowding out some other jobs elsewhere 

in the Australian economy. 

Table 5 Direct and indirect contribution of PMV-L production in 

Australian to Australian FTE jobs 

2012 2013 2014 2015 2016 

Annual 

average 


Victoria 394 560 670 668 556 570 

Australia 363 513 614 614 511 523 


60 

2012 2013 2014 2015 2016 

Potential impact of constructing PMV-L in Australia 47 

76 

79 

70


Bibliography 

ABS. (2009). 8167.0 - Selected Characteristics of Australian Business, 2006-07. 

Kerr, J. (2009). Defence Business: Bushmaster branches out. Australian Defence Magazine . 

Kerr, J., & Foss, F. C. (2009). Protection on the move: Australia's Bushmaster evolves for 

operations. International Defence Review . 

Tasman Asia Pacific. (2000). Impact of Major Defence Projects: A Case Study of the ANZAC Ship 

Project. Canberra. 

Tasman Economics. (2002). Impact of Major Defence Projects: A Case Study of the Minehunter 

Coastal Project. Canberra. 

Thales Australia. Unpublished. 

Thales. (June 2008). Bushmaster background information. Unpublished. 

The Hon. Greg Combet AM MP. (2009, June 12). Opportunity for Australian Defence 

Industry. Media Release . 

Bibliography i


A Survey questionnaire 

Survey questionnaire A-1














B The Tasman Global model 

ACIL Tasman‘s computable general equilibrium model Tasman Global is a 

powerful tool for undertaking economic impact analysis at the regional, state, 

national and global level. 

There are various types of economic models and modelling techniques. Many 

of these are based on partial equilibrium analysis that usually considers a single 

market. However, in economic analysis, linkages between markets and how 

these linkages develop and change over time can be critical. Tasman Global has 

been developed to meet this need. 

Tasman Global is an analytical tool that can capture these linkages on a regional, 

state, national and global scale. Tasman Global is a large-scale computable 

general equilibrium model which is designed to account for all sectors within 

an economy and all economies across the world. ACIL Tasman uses this 

modelling platform to undertake industry, project, scenario and policy analyses. 

The model is able to analyse issues at the industry, global, national, state and 

regional levels and to determine the impacts of various economic changes on 

production, consumption and trade at the macroeconomic and industry levels. 

A Dynamic model 

Tasman Global is a model that estimates relationships between variables at 

different points in time. This is in contrast to comparative static models, which 

compare two equilibriums (one before a policy change and one following). A 

dynamic model such as Tasman Global is beneficial when analysing issues where 

both the timing of and the adjustment path that economies follow are relevant 

in the analysis. 

In applications of the Tasman Global model, a reference case simulation forms a 

―business-as-usual‖ basis with which to compare the results of various 

simulations. The reference case provides projections of growth in the absence 

of the changes to be examined. The impact of the change to be examined is 

then simulated and the results interpreted as deviations from the reference 

case. 

The database 

A key advantage of Tasman Global is the level of detail in the database 

underpinning the model. The model database is derived from the latest Global 

Trade Analysis Project (GTAP) database which was released in 2008. However, 

for the current BUSHRANGER Project GTAP‘s 2001 database was the 

starting point as its time and structure reflected the Australian and world 

The Tasman Global model B-1


economy at around the time the Bushmasters commenced production. This 

database is a fully documented, publicly available global data base which 

contains complete bilateral trade information, transport and protection linkages 

among regions for all GTAP commodities. 

The GTAP model was constructed at the Centre for Global Trade Analysis at 

Purdue University in the United States. It is the most up-to-date, detailed 

database of its type in the world. 

Tasman Global builds on the GTAP model‘s equation structure and database by 

adding five important features: dynamics (including detailed population and 

labour market dynamics), detailed technology representation within key 

industries (such as electricity generation and iron and steel production), the 

ability to repatriate labour and capital income, a detailed emissions accounting 

abatement framework and explicit representation of the states and territories of 

Australia. 

Nominally the Tasman Global database divides the world economy into 120 

regions although in reality the regions are frequently disaggregated further. 

ACIL Tasman regularly models projects or policies at the statistical division 

(SD) level, as defined by the ABS, but finer regional detail has been modelled 

when warranted. 

The GTAP database also contains a wealth of sectoral detail (see Table 6). The 

foundation of this information is the I-O tables that underpin the database. 

The I-O tables account for the distribution of industry production to satisfy 

industry and final demands. Industry demands, so-called intermediate usage, 

are the demands from each industry for inputs. For example, electricity is an 

input into the production of communications. In other words, the 

communications industry uses electricity as an intermediate input. Final 

demands are those made by households, governments, investors and foreigners 

(export demand). These final demands, as the name suggests, represent the 

demand for finished goods and services. To continue the example, electricity is 

used by households – their consumption of electricity is a final demand. 

Each sector in the economy is typically assumed to produce one commodity, 

although in Tasman Global, the electricity, diesel and iron and steel sectors are 

modelled using a ‗technology bundle‘ approach. With this approach, different 

known production methods are used to generate a homogeneous output for 

the ‗technology bundle‘ industry. For example, electricity can be generated 

using brown coal, black coal, petroleum, gas, nuclear, hydro, biomass, wind, 

solar or other renewable based technologies – each of which have their own 

cost structure. 



Table 6 Sectors in the Tasman Global database 

Sector Sector 

1 Paddy rice 31 Paper products, publishing 

2 Wheat 32 Diesel (incl. nonconventional diesel) 

3 Cereal grains nec 33 Other petroleum, coal products 

4 Vegetables, fruit, nuts 34 Chemical, rubber, plastic products 

5 Oil seeds 35 Mineral products nec 

6 Sugar cane, sugar beef 36 Ferrous metals 

7 Plant- based fibres 37 Metals nec 

8 Crops nec 38 Metal products 

9 Bovine cattle, sheep, goats, horses 39 Motor vehicle and parts 

10 Animal products nec 40 Transport equipment nec 

11 Raw milk 41 Electronic equipment 

12 Wool, silk worm cocoons 42 Machinery and equipment nec 

13 Forestry 43 Manufactures nec 

14 Fishing 44 Electricity 

15 Coal 45 Gas manufacture, distribution 

16 Oil 46 Water 

17 Gas 47 Construction 

18 Minerals nec 48 Trade 

19 Bovine meat products 49 Road transport 

20 Meat products nec 50 Rail and pipeline transport 

21 Vegetables oils and fats 51 Water transport 

22 Dairy products 52 Air transport 

23 Processed rice 53 Transport nec 

24 Sugar 54 Communication 

25 Food products nec 55 Financial services nec 

26 Beverages and tobacco products 56 Insurance 

27 Textiles 57 Business services nec 

28 Wearing apparel 58 Recreational and other services 

29 Leather products 59 Public Administration, Defence, Education, Health 

30 Wood products 60 Dwellings 

Note: nec = not elsewhere classified 

The other key feature of the database is that the cost structure of each industry 

is also represented in detail. Each industry purchases intermediate inputs (from 

domestic and imported sources) primary factors (labour, capital, land and 

natural resources) as well as paying taxes or receiving subsidies. 

Factors of production 

Capital, land, labour and natural resources are the four primary factors of 

production. The capital stock in each region (country or group of countries) 

accumulates through investment (less depreciation) in each period. Land is 



used only in agriculture industries and is fixed in each region. Tasman Global 

explicitly models natural resource inputs as a sector specific factor of 

production in resource based sectors (coal mining, oil and gas extraction, other 

mining, forestry and fishing). 

Population growth and labour supply 

Population growth is an important determinant of economic growth through 

the supply of labour and the demand for final goods and services. Population 

growth for the 112 international regions and for the 8 states and territories of 

Australia represented in the Tasman Global database is projected using ACIL 

Tasman‘s in-house demographic model. The demographic model projects how 

the population in each region grows and how age and gender composition 

changes over time and is an important tool for determining the changes in 

regional labour supply and total population over the projection period. 

For each of the 120 regions in Tasman Global, the model projects the changes in 

age-specific birth, mortality and net migration rates by gender for 101 age 

cohorts (0-99 and 100+). The demographic model also projects changes in 

participation rates by gender by age for each region, and, when combined with 

the age and gender composition of the population, endogenously projects the 

future supply of labour in each region. Changes in life expectancy are a 

function of income per person as well as assumed technical progress on 

lowering mortality rates for a given income (for example, reducing malariarelated 

mortality through better medicines, education, governance etc). 

Participation rates are a function of life expectancy as well as expected changes 

in higher education rates, fertility rates and changes in the work force as a share 

of the total population. 

Labour supply is derived from the combination of the projected regional 

population by age by gender and the projected regional participation rates by 

age by gender. Over the projection period labour supply in most developed 

economies is projected to grow slower than total population as a result of 

ageing population effects. 

For the Australian states and territories, the projected aggregate labour supply 

from ACIL Tasman‘s demographics module is used as the base level potential 

workforce for the detailed Australian labour market module, which is described 

in the next section. 

B.1.1 The Australian labour market 

Tasman Global has a detailed representation of the Australian labour market 

which has been designed to capture: 

• different occupations; 



• changes to participation rates (or average hours worked) due to changes 

in real wages; 

• changes to unemployment rates due to changes in labour demand; 

• limited substitution between occupations by the firms demanding 

labour and by the individuals supplying labour; and 

• limited labour mobility between states. 

Tasman Global recognises 97 different occupations within Australia – although 

the exact number of occupations depends on the aggregation. The firms who 

hire labour are provided with some limited scope to change between these 97 

labour types as the relative real wage between them changes. Similarly, the 

individuals supplying labour have a limited ability to change occupations in 

response to the changing relative real wage between occupations. Finally, as 

the real wage for a given occupation rises in one state rise relative to other 

states, workers are given some ability to respond by shifting their location. 

The model produces results at the 97 3-digit ANZSCO (Australian New 

Zealand Standard Classification of Occupations) level. 

The labour market structure of Tasman Global is thus designed to capture the 

reality of labour markets in Australia, where supply and demand at the 

occupational level do adjust, but within limits. 

Labour supply in Tasman Global is presented as a three stage process: 

1. labour makes itself available to the workforce based on movements in 

the real wage and the unemployment rate; 

2. labour chooses between occupations in a state based on relative real 

wages within the state; and 

3. labour of a given occupation chooses in which state to locate based on 

movements in the relative real wage for that occupation between states. 

By default, Tasman Global, like all general equilibrium models, assumes that 

markets clear. Therefore, overall, supply and demand for different occupations 

will equate (as is the case in other markets in the model). 

B.2 Assumptions used in the BAU reference case 

In the BAU reference case scenario, projections of the economy outcomes 

from 2009 to 2016 were modelled based on Commonwealth Treasury May 

2009 Budget Paper forecasts and projections for the Australian economy up to 

the year 2016. For the Bendigo region, the rest of Victoria and the rest of 

Australia this national growth was broken down using ACIL Tasman 

assumptions for future regional: 



− Changes in population – particularly changes in the number of people 

of working age (15 years old and over). 

− Changes in workforce participation rates – defined here as the average 

number of hours worked in the labour force by all people of working 

age. This measure encompasses changes in participation rates by age by 

gender, the unemployment rate and average hours worked. 

− Growth in labour productivity – defined here as the average output per 

hour worked. 

The projection of each of these elements is discussed in the following sections. 

Population growth 

Population growth is an important determinant of economic growth through 

the supply of labour and the demand for final goods and services. Population 

growth for 112 international regions and the 8 states and territories of Australia 

represented in the Tasman Global database has been projected using ACIL 

Tasman‘s in-house demographic model. 2 The demographic model projects 

how the population in each region grows and how age and gender composition 

changes over time and is an important tool for determining the changes in 

regional labour supply and total population over the projection period. 

For each of the 120 regions, the model projects the changes in age-specific 

birth, mortality and net migration rates by gender for 101 age cohorts (0-99 

and 100+). The demographic model also projects changes in participation rates 

by gender by age for each region, and, when combined with the age and gender 

composition of the population, endogenously projects the future supply of 

labour in each region. Changes in life expectancy are a function of income per 

person as well as assumed technical progress on lowering mortality rates for a 

given income (for example, reducing malaria-related mortality through better 

medicines, education, governance etc). Participation rates are a function of life 

expectancy as well expected changes in higher education rates, fertility rates 

and changes in the work force as a share of the total population. 

For this analysis, global population is projected to increase over the projection 

period by 0.83 per cent a year, increasing the global population from around 

6.7 billion in 2008 to 8.04 billion in 2030. Most of this growth occurs in the 

next decade, with the average annual growth projected to be 0.95 per cent a 

year to 2020, falling to 0.67 per cent a year between 2020 and 2030. The 

slowing rate of growth is due to continuing declines in fertility rates across 

developing countries coupled with ageing population effects across developed 

2 For the modelling in this report the populations in all Australian states and territories other 

than Victoria have been aggregated to form the population for the rest of Australia. 



economies and some developing economies such as China. For example, 

Japan‘s population is projected to begin declining in the 2009 calendar year 

while the population of the European Union over the period is projected to 

increase moderately before falling back to current levels around 2030. 

Population growth for the eight Australian states and territories incorporates 

all the latest ABS information on population levels, fertility, mortality and 

migration rates The total Australian population in 2020 is projected to be 25.1 

million, with the population of Victoria projected to be 6.2 million. The 

population growth assumptions used for the regions modelled in this analysis 

are shown in Figure 32. 

Figure 32 Assumed growth in population (per cent, year on year) 

2.0 

1.8 

1.6 

1.4 

1.2 

1.0 

0.8 

0.6 

0.4 

0.2 

% 

2002 2004 2006 2008 2010 2012 2014 2016 

Source: ACIL Tasman projections 

Labour supply 

China 

Labour supply is derived from the combination of the projected regional 

population by age by gender and the projected regional participation rates by 

age by gender. Over the projection period labour supply in most developed 

economies is projected to grow slower than total population as a result of 

ageing population effects. Some developing economies, notably China, are also 

projected to have slower growth in labour supply compared to total 

population. The labour supply growth assumptions used for the regions 

modelled in this analysis are shown in Figure 33. 

The Tasman Global model B-7 

USA 

EU 

Rest of world 

Victoria 

Australia


Figure 33 Assumed growth in labour supply, reference case (per cent, 

year on year) 

3.0 

2.5 

2.0 

1.5 

1.0 

0.5 

% 

-0.5 

2002 2004 2006 2008 2010 2012 2014 2016 

Source: ACIL Tasman projections 

Unemployment 

China 

In addition to tracking the available workforce through the changes in 

population demographics and participation rates, Tasman Global also tracks 

unemployment rates. It should be noted that unemployment and participation 

rates are largely interchangeable in affecting the number of people available for 

work in the model. Separate identification of the components is undertaken to 

allow a more representative labour market. In general, when unemployment is 

high, increases in labour demand can largely be supplied by reducing the 

unemployment rate but when unemployment is low, increases in labour 

demand will largely be met by increasing participation rates (and/or hours 

worked). Changes in participation rates in Tasman Global are driven by changes 

in the real wages offered by employers. 

Figure 34 shows historical unemployment rates in the Bendigo region, Victoria 

and Australia. 


USA 

EU 

Rest of world 

Victoria 

Australia


Figure 34 Historical and assumed unemployment by region, reference 

case 

18 

16 

14 

12 

10 

8 

6 

4 

2 

% 

Data source: ABS Detailed Labour Force by region statistics, catalogue number 6291.0.55.001 and ACIL Tasman 

assumptions. 

It can be seen that the Bendigo region has traditionally experienced a higher 

and more volatile level of unemployment than Victoria as a whole and 

Australia. This differential has trended down in the last few years. However, 

with the onset of the Global Financial Crisis and the introduction of the 

Carbon Pollution Reduction Scheme (CPRS) it is envisaged that the historical 

differential will reappear. For the current modelling it has been assumed that 

the Bendigo region will experience higher levels of unemployment than 

Australia as a whole in line with historical averages. 

Labour productivity growth 


Victoria 

Australia 

Labour productivity is a measure of the quantity of goods and services per unit 

of time worked. Growth in labour productivity is highly variable on a year to 

year basis and is influenced by many developments in the economy, including 

changes in capital intensity and the composition of the work-force (Treasury 

2007). 

Over the past 30 years Australian labour productivity growth has averaged 1.75 

per cent a year and 1.8 per cent over the past 40 years (Treasury 2007). Near 

term labour productivity growth is determined as a result of the near term 

projections of labour supply and real GDP. In the reference case, the annual 

growth in Australian labour productivity is subsequently assumed to gradually 

slow from around 1.75 at the end of the next decade to 1.5 per cent a year over 

the projection period as the composition of the Australian economy continues 



to shift toward services, which has historically had lower rates of productivity 

growth compared to the rest of the economy. 

Real economic output growth 

In Tasman Global, base case growth in economic output (GDP and GSP) is 

based on a mixture of historical data, near-term projections by the 

Commonwealth and State Treasuries and medium-long run projections. 

Australian historical GSP growth to 2008 is sourced from the ABS national 

accounts, while historical growth for the rest of the World is sourced from the 

IMF World Economic Outlook. Near term projections (to 2017) for Australia 

as a whole are sourced from the latest Commonwealth Budget papers. The 

projections for the rest of the World (to 2014) are sourced from the latest IMF 

World Economic Outlook. Projections for economic growth past these points 

are determined using ACIL Tasman‘s projections of labour supply and labour 

productivity. 

The impacts of the current financial crisis are expected to take a couple of 

years to move through the system, with the global economy returning to 

historical growth trends by 2012. Real economic growth assumptions used for 

the reference case for this analysis are shown in Figure 35. 

Figure 35 Real economic output growth by region, reference case 

14 

12 

10 

8 

6 

4 

2 

% 

-2 

-4 

-6 

2002 2004 2006 2008 2010 2012 2014 2016 


China 

Based on these economic growth assumptions, the level of Australia‘s real 

GDP rises from $1.13 trillion 3 in 2007-08 to $1.42 trillion in 2015-16. Over the 

same period Victorian real GSP is assumed to grow from approximately $268 

billion 3 in 2007-08 to around $333 billion in 2015-16. 

3 Where billion is defined as 1x10 9 as per the US convention. Trillion is defined as 1x10 12 . 


USA 

EU 

Rest of world 

Victoria 

Australia


B.2.1 Labour market assumptions 

In the simulations performed with Tasman Global the labour market can be 

treated in a number of ways. Traditionally, CGE modelling utilises one of three 

labour market assumptions: 

1. Fixed labour supply (the full employment approach) and zero labour 

mobility between Australian regions 

2. Medium term adjustment to labour supply and zero labour mobility 

between Australian regions 

3. Full labour mobility between regions so that changes to wages are equalised 

across Australian regions. 

Labour market assumption 2 simply allows local supply to vary in the medium 

term (five to ten years) before returning to its long run position. It provides a 

temporary reprieve from labour market constraints. Labour market 

assumptions 1 and 3 are more extreme. Under assumption 1, the proposed 

smelter expansion would have to be accomplished with only the current labour 

available in the Hunter region with some allowance for natural growth, i.e. no 

new labour could be drawn to the Hunter region as a result of the project. 

Under assumption 3 changes to wages in the Hunter would be the same as 

changes to wages in all Australian regions, with labour shifting between 

Australian regions until changes to wages equalise. Modelling under 

assumption 3 provides the largest movement in labour across regions. 

Tasman Global includes a labour market module that allows for constrained 

movement between regions of the Australian economy. Hence for this project, 

we have elected to use a hybrid labour market assumption (which allows for 

some medium term adjustment potential), rather than resort to the use of 

assumption 2. But what level of constraint is appropriate (i.e. what level of 

labour movement between Australian regions makes sense)? In previous work 

the model has been calibrated to replicate the observed movement of labour 

between Australia‘s States and Territories during the period from 2001 to 2006. 

It is these settings that are used for the modelling the future outcomes in this 

analysis. 


C-1 

CGE modelling results for Bushmaster production and TLS 

C CGE modelling results for Bushmaster production and TLS 

Table C1 Bushmaster production GDP $m impacts ($2008) 

2002 2003 2004 2005 2006 2007 2008 2009 

Bendigo region 5.1 6.6 10.0 21.6 31.3 34.7 59.5 68.3 

Rest of Victoria 13.8 14.9 16.5 19.2 21.8 23.4 28.0 30.4 

Victoria 18.9 21.5 26.5 40.9 53.1 58.1 87.5 98.6 

Australia 18.8 21.2 26.5 39.8 51.9 59.3 89.3 101.0 

2010 2011 2012 2013 2014 2015 2016 Total 



Victoria 102.0 104.7 69.4 68.1 70.2 72.7 75.2 967.4 

Australia 105.5 108.3 73.1 72.1 74.5 77.1 79.9 998.3 


Table C2 Bushmaster TLS GDP $m impacts ($2008) 

2002 2003 2004 2005 2006 2007 2008 2009 

Bendigo region 0 0 0.0 0.0 0.0 0.0 0.0 0.0 

Rest of Victoria 0 0 0.1 1.5 2.0 3.4 3.3 4.2 

Victoria 0 0 0.1 1.5 2.0 3.4 3.2 4.2 

Australia 0 0 0.1 2.7 3.7 6.9 5.9 7.6 

2010 2011 2012 2013 2014 2015 2016 Total 

Bendigo region 0.0 0.0 0.0 -0.1 -0.1 -0.1 -0.1 -0.5 


Victoria 5.1 5.9 5.8 6.1 6.5 6.8 7.1 57.7 

Australia 9.9 12.4 13.6 15.0 16.6 18.6 20.5 133.4 


The economic impacts of the BUSHRANGER Project

C-2 


Table C3 Bushmaster production GNP $m impacts ($2008) 

2002 2003 2004 2005 2006 2007 2008 2009 



Victoria 19.0 22.2 28.5 47.4 63.0 67.7 110.1 121.7 

Australia 21.1 23.8 30.2 48.0 63.1 69.8 110.5 123.3 

2010 2011 2012 2013 2014 2015 2016 Total 

2010 2011 2012 2013 2014 2015 2016 Total 



Victoria 123.1 124.6 77.1 74.7 76.7 79.2 81.9 1116.9 

Australia 125.5 126.1 77.6 75.3 77.6 80.2 83.1 1135.1 


Table C4 Bushmaster TLS GNP $m impacts ($2008) 

2002 2003 2004 2005 2006 2007 2008 2009 

Bendigo region 0 0 0.0 0.0 0.0 –0.1 –0.1 –0.1 

Rest of Victoria 0 0 0.1 1.6 2.0 3.5 3.2 4.0 

Victoria 0 0 0.1 1.5 2.0 3.4 3.1 4.0 

Australia 0 0 0.2 4.4 5.7 10.4 9.1 11.9 

2010 2011 2012 2013 2014 2015 2016 Total 

Bendigo region –0.1 –0.1 –0.1 –0.1 –0.1 –0.1 –0.1 –1.0 


Victoria 4.8 5.6 5.8 6.3 6.8 7.3 7.8 58.4 

Australia 14.9 17.7 17.9 19.3 20.8 22.6 24.4 179.3 



C-3 


Table C5 Bushmaster production FTE employment impacts 

2002 2003 2004 2005 2006 2007 2008 2009 

Bendigo region 30 172 574 673 721 770 829 882 

Rest of Victoria 62 80 130 152 170 178 213 234 

Victoria 92 252 705 825 891 948 1042 1116 

Australia 71 226 675 770 818 882 919 987 

2010 2011 2012 2013 2014 2015 2016 

Bendigo region 913 895 398 382 387 390 392 561 


Victoria 1150 1133 560 537 544 550 555 727 

Australia 1023 1003 482 463 472 477 482 650 

Data source: ACIL Tasman estimates 

Table C6 Bushmaster TLS FTE employment impacts 

Annual 

Average 

2002 2003 2004 2005 2006 2007 2008 2009 

Bendigo region 0 0 0 0 0 0 -1 0 


Victoria 0 3 10 17 20 29 27 43 

Australia 0 3 11 18 24 37 32 48 

2010 2011 2012 2013 2014 2015 2016 

Bendigo region 0 0 0 0 0 0 -1 0 


Victoria 57 70 84 90 93 96 99 92 

Australia 68 82 98 109 112 117 122 111 


Annual 

Average 


D-1 

CGE modelling results for PMV-L production 

D CGE modelling results for PMV-L production 

Table D1 PMV-L production GDP $m impacts ($2008) 

2012 2013 2014 2015 2016 Total 


Rest of Victoria 4 6 8 8 7 33 

Victoria 29 43 54 56 50 232 

Australia 31 47 60 64 59 261 


Table D2 PMV-L production GNP $m impacts ($2008) 

2012 2013 2014 2015 2016 Total 



Victoria 39 57 71 74 65 305 

Australia 41 60 76 79 70 327 


Table D3 PMV-L production FTE employment impacts 

2012 2013 2014 2015 2016 

Annual 

Average 



Victoria 394 560 670 668 556 570 

Australia 363 513 614 614 511 523

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