18 Jul 2016

Local firms want piece of defence upgrade spending

10:11 am on 18 July 2016

With $20 billion worth of upgrades planned for the Defence Force over the next 15 years, local companies want to make sure they get a piece of the pie.

The HMNZS Te Kaha out at sea with a helicopter flying above

The HMNZS Te Kaha. Photo: NZDF

Though there is no domestic capacity to build warships or surveillance aircraft needed to replace Anzac frigates or Hercules and Orion planes businesses here say there is still plenty they can contribute.

One such company is a high tech electronics hardware firm Loop Technologies, which provides support and repair services for technology hardware.

Roger Hurst, director of the Hamilton company, believes there is potential in the upgrades although it will not be directly supplying equipment.

He said the firm with its 65 employees could offer overseas companies a local support network and logistical framework, which would save them having to establish a base themselves.

It was not only cheaper to go local, there was also the benefit of being in the same time zone, having easy transport and ongoing support, Mr Hurst said.

"We've been able to keep equipment going for 30-plus years quite comfortably, even indefinitely.

"That's one benefit that Defence have seen, being able to support equipment that has been obsolete and not supportable."

Electronic Navigation Ltd has been in the marine electronics and communications field for 70 years and has 50 staff at branches in the North Shore, Nelson, and Europe.

Chief sales officer Terry McDonald said they had already started hiring new staff to prepare for the new opportunities.

"We don't have the capacity here to build seriously large ships, and very sophisticated planes and helicopters and things, but what we certainly do have here is a very, very good technical resource required to support these things.

"They need to be supported for decades."

Defence Industry Association chairman Bernie Diver said the sector contributed 2500 jobs and $60 million in profits to the economy.

He said it was well prepared to provide support, simulation, maintenance and repair services.

"It's about New Zealand industry being given the opportunity to compete."

And more business means more jobs.

"The defence industry is typically a well rewarded, highly paid career," he said.

The Ministry of Defence had gone to great lengths to work with the domestic defence industry, Mr Diver said.

A spokesman for the ministry said it had worked hard to engage local industry, including encouraging foreign companies to show how they would use local firms when they were tendering for contracts.

It also commissioned the 2014 report 'Optimising New Zealand Industry Involvement in the New Zealand Defence Sector'.

"The report aimed to determine the extent to which there were further opportunity [opportunities] to optimise the involvement of New Zealand industry in supplying the New Zealand Defence sector," said a statement from the ministry.

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