Message from ALC

Unlocking freight rail opportunities

Australian Logistics Council CEO, Kirk Coningham, discusses the progress being made to properly realise the role rail will play to manage Australia’s growing freight task. T HERE IS WIDESPREAD RECOGNITION among policy-makers and freight logistics industry participants about the benefits of moving more freight via rail. It has the potential to significantly improve the efficiency and safety of freight movement, while at the same time improving urban amenity, reducing road congestion and decreasing queuing times at ports.

However, there is also recognition that Australia is, to some extent, playing ‘catch up’ in when it comes to enhancing the quality and capacity of our freight rail networks. The fact that construction of Inland Rail is now underway – after decades of talk – is testament to the fact that governments are finally recognising the increasingly vital role that rail will play in facilitating Australia’s growing freight task.

Yet even in the case of this most prominent of freight rail infrastructure projects, there remains uncertainty over key details – most particularly, the establishment of a dedicated freight rail connection from Inland Rail to the Port of Brisbane. Establishing this connection will be essential to derive the full benefits of the project and address road congestion in Brisbane as that city continues to grow.

Similarly, making more effective use of short-haul rail is not merely important from a productivity standpoint. It is also crucial to the freight logistics industry’s continuing efforts to improve its social licence. Freight volumes going through major Australian ports are increasing, and it is worth noting that many of these ports are operate within inner city e nvironments that are increasingly desirable residential locations for our growing population.

Achieving modal shift from road onto rail in order to transport it from ports to intermodal terminals is an ideal way to reduce traffic congestion in port precincts. Some progress has been made at the jurisdictional level in recent years, such as the NSW Government’s target of having 27 per cent of freight moved by rail, and the focus on port rail shuttles within the Victorian Government’s freight strategy released in mid-2018. However, there is a place for greater national lead ership, particularly with work now occurring to finally develop a National Rail Plan.

As part of this work, the federal government must take immediate action to ensure that corridors are protected that will permit the construction and use of short haul rail as freight transport solution in Australia’s growing cities.

Likewise, the National Rail Plan must finally address the costs and inefficiencies that stem from Australia’s current approach to rail regulation, particularly around environmental regulation, workplace health and safety, workers’ compensation, and drug and alcohol testing in the sector.

In 2015, the cost of inconsistent and overlapping jurisdictional regulations in these areas was estimated to be $29 million per annum – yet progress towards meaningful reform has remained frustratingly slow.

There are several possible explanations for this – but a major factor is certainly the lack of a dedicated regulator in the rail sector with oversight of productivity and efficiency matters.

The Office of the National Rail Safety Regulator (ONRSR) was established as part of a Commonwealth policy designed to harmonise transport operations across Australia. In the road space, the National Heavy Vehicle Regulator (NHVR) was established in 2012.

However, there is one important difference between ONRSR and NHVR. The NHVR has a productivity mandate. ONRSR, while playing an important role in national rail safety, does not have the responsibility for the productivity and efficiency of Australian rail operations.

ALC believes this should change, and that the current Productivity Commission review of national transport regulators should recommend ONRSR be given the mandate and resources it needs needed to drive enhanced productivity in the rail sector.

This is a relatively straightforward reform that will help overcome years of inaction and a lack of accountability in delivering the regulatory harmonisation that the rail sector urgently needs.

Australian Logistics Council CEO, Kirk Coningham.

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