Shipping Australia Limited
ABN 61 096 012 574
Suite 2, Level 1, 101 Sussex Street, Sydney NSW 2000
PO Box Q388 QVB PO, Sydney NSW 1230
Tel: (02) 9266 9900
Fax: (02) 9279 1471
10 January 2013
The Project Manager
Rail Access Review
Transport for NSW
Level 6, 18 Lee Street
Chippendale, NSW 2008
email: [email protected]
Dear Sir/Madam
Submission by Shipping Australia Limited
Shipping Australia appreciates the opportunity of making a submission regarding the review of the
NSW rail access regime. Shipping Australia’s members (list attached) would be responsible for the
carriage of around 70 per cent of containers and motor vehicles that are imported and exported from
this country as well as around 60 per cent of our bulk and break bulk trades. Trade facilitation and
moving cargo to prevent the hold up of vessels and port congestion, has been a major focus since the
original formation of Shipping Australia in July 2001 as a result of a merger between the Australian
Chamber of Shipping and Liner Shipping Services Limited.
It is in this context, that Shipping Australia is addressing this review and given our lack of detailed
knowledge regarding the operation of rail, we would not propose to address each of the questions
raised in the submission but rather make some overall comments which we would hope will be given
consideration.
Shipping Australia has always been supportive of increasing freight on rail given its capacity for large
volume movements compared to road but we recognise the current deficiencies in both rail operation
and rail infrastructure.
We also are pleased to see that this review is contained within the overall draft NSW Freight and
Ports Strategy because the future of rail has to be seen within the context of making supply chains
more efficient generally. In that latter respect, in January last year we released a study* on
intermodal terminals in metropolitan areas in Australia, including Sydney which emphasised the need
for a dedicated rail service between Port Botany and the intermodal terminals of Enfield and
Moorebank.
2
A major issue raised in that study is the viability of rail versus road which is an issue that is also
discussed in the draft NSW Freight and Ports Strategy, dated November 2012.
As mentioned in that draft freight strategy, in 2006, the Productivity Commission found that there is
the need for a case by case approach to determine if the benefits of mandated access are outweighed
by the costs. In particular, the low volumes on regional networks strongly suggest there is limited
capacity for above-rail competition and separation may further reduce the commercial viability of
these networks. It is probable that having one vertically integrated operator would be the most
efficient outcome for these networks.
These comments lead SAL to the conclusion that the feeder service between Port Botany and the
intermodal terminals at Enfield, and eventually Moorebank, would benefit from having one vertically
integrated operator if there is going to be optimisation of the carriage of containers by rail between
Port Botany and these intermodal terminals.
It is essential that the price differential between road and rail be reduced and in this respect the
subsidisation occurs with country rail freight lines may be applicable. This would necessitate a level
of price regulation.
This does have reference to question 13 in the review which asks should the restriction on vertical
integration continue to apply to the country rail network or should the regime be flexible in
accommodating alternative business models including potentially an exclusive rail franchise? Our
view would be in relation to servicing intermodal terminals that an exclusive rail franchise is an
appropriate model.
Naturally, the rail operator servicing these metropolitan intermodal terminals should be selected by
open tender and perhaps serial competition could be introduced with the tender being for a period of
seven to ten years, as long as the period was sufficient to justify the level of investment required.
This would ensure a certain degree of competition in the future.
We would be happy to elaborate on the above or answer any questions you may have in relation to
the issues we have raised.
Yours sincerely
Llew Russell, AM
Chief Executive Officer
* for access to the SAL study on intermodal terminals visit http://shippingaustralia.com.au/wpcontent/uploads/2012/07/Intermodal_Terminals_WEB.pdf