Heather Ridout, the leading industry lobbyist with close connections to the Labor government, is to join the Reserve Bank board.Ridout, the CEO of the manufacturing-dominated Australian Industry Group, replaces Graham Kraehe, the chairman of Bluescope Steel and of Brambles Industries.The move replaces one "voice of manufacturing" with another. The Australian treasurer, Wayne Swan, said that Ridout's "understanding of the manufacturing sector in particular will be valuable to the board at a time when different sectors of our patchwork economy face different pressures."But Ridout is also a trained economist who will bring to the board a knowledge of small- and medium-sized businesses that it has sometimes been seen to lack.The Financial Review reported this morning that she was set to resign her AIG role, a move that would defuse some potential claims of a conflict of interest.Ridout deepened her group's ties with Labor when she stayed out of a business campaign favouring key elements of the Howard government's Work Choices policy. She has been tapped by the government for a series of inquiries and forums, notably the Henry Tax Review and Infrastructure Australia. But she also retains ties to the conservative side of politics; early in her career she worked for a Liberal senator.Economist Dr Ian Harper called Ridout's appointment "eminently worthy" and said her leadership of a lobby group "should not be a disqualification". He also welcomed the presence for the first time of three women on the board, something he noted few private-sector boards could boast.