May 28, 2008

Address to the Australian Trucking Association National Convention

Address to the Australian Trucking Association National Convention

National Convention Centre, Canberra

The Hon Anthony Albanese MP

Minister for Infrastructure, Transport,

Regional Development and Local Government

Leader of the House

Federal Member for Grayndler

May 28 2008

Trevor Martyn, ATA Chair,

Board members and councillors,

ATA sponsors, including foundation sponsors BP, NTI and Volvo,

Stuart St Clair, ATA Chief Executive,

Ladies and Gentleman


Thank you for the invitation to address you today.

I’m told tonight you will be invited to bid for a new Volvo FH

Five Twenty– the star of tonight’s Auction Dinner.

I will say it looks pretty impressive and should attract some pretty serious bidding.

It’s probably fair to say the person who takes home the truck tonight will be motivated by a few key factors.

They will recognise that investing in this sort of vehicle is more than just a cost. It is a valuable investment in the future of their business that will help drive productivity.

The winner will also be the sort of person who doesn’t just focus on the short term. Rather, they will have an eye on the big picture, and be keen to ensure they have assets in place to prepare them for the future.

Tonight’s winner will also probably understand the key to meeting future demand means investing in modern technology and new ways of operating– not relying on technology and methods that may be neglected, broken down or from a bygone era.

These three factors…

  • Investing in infrastructure
  • New ways of meeting the challenges of the new century
  • Focussing on the long term, not just the short term

…are key components of the Rudd Government’s new infrastructure agenda. This agenda is a key plank of our economic plan to tackle inflation and boost productivity.

We see investment in our infrastructure assets as much more than a cost.

It is, quite simply, an investment in our future that will help secure our nation’s economic and social prosperity for our children and future generations.

The Rudd Government is committed to providing long term solutions to our infrastructure challenges – not funding projects solely on the basis of getting us re-elected in three years time.

We’re also committed to effecting changes that will make a difference to our economic performance and our social outcomes beyond the current resources boom.

Changes that will have a lasting effect on lifting national productivity and improving outcomes for Australians.

We firmly believe Australia needs 21st century infrastructure to help us meet 21st century demands.

I said on budget night two weeks ago the Australian Government is back in the business of nation building.

The Federal Budget demonstrated this Government’s determination to fix Australia’s overstretched transport networks and build infrastructure to meet the challenges of the 21st century.

We can no longer allow Australia’s clogged road, port and rail links to restrict our economic potential by restricting productivity.

On one estimate, infrastructure shortfalls are costing us 0.8 percent of GDP in lost production each year. That equals about $8 billion dollars per year.

My department also estimates that the cost of urban congestion in our cities for families and businesses will be something like $20 billion by 2020.

Inefficient freight networks are a disincentive to investment.

There is little incentive for business to increase output if they know their products will get stuck on the back of one of your trucks along a gridlocked M5 to Port Botany.

And we know that the biggest cause of congestion on our urban roads are cars, not trucks.

And the costs are not just economic; there are more significant social costs to consider as well.

I’m sure I don’t need to spell out to a room full of truck owners, managers and employees the frustration of being stuck in traffic with a full load, when you know you should really be at home with your family.

Quite frankly, when people are spending more time commuting in their cars each day than they are spending with their families, we have a situation requiring urgent attention.

Making inroads into this problem won’t be easy – it will take time and a considerable amount of cooperation between all players involved.

But the commitment from the Commonwealth is real, and backed up by significant funds.

As you know, the centrepiece of our first Budget was the Building Australia Fund which will fund much-needed improvements to our nation’s infrastructure.

Our first contribution into the fund is $20 billion, a down-payment which we will use to fund future upgrades to our transport and broadband infrastructure.

We expect to make the first allocations from under the Fund in 2009-10.

The establishment of Infrastructure Australia and the creation of the Building Australia Fund, initiatives I know were supported by the ATA, represent a significant shift in the way we coordinate, plan and fund future infrastructure.

Last week I announced the members of the Infrastructure Australia Advisory Council who will join Sir Rod Eddington to map a path to meet Australia’s future infrastructure needs.

They are a diverse group of people drawn from best of private industry and the public sector, possessing a wide range of skills and experience.

Working closely with Infrastructure Australia will be a new body in my department called the Major Cities Unit.

Australia has become one of the most urbanised countries in the world, with around 80 percent of us living in one of our major cities.

Despite this, the previous Commonwealth Government disengaged itself from our cities, and took a hands-off approach to their growth and development.

Australia’s major cities, and by this I don’t just mean the capitals but places like Townsville, Newcastle, the Gold Coast and Geelong are facing a range of infrastructure and planning challenges.

People in our cities currently have to deal with a range of federal, state and local government agencies on issues affecting them, which can be confusing, cumbersome and costly.

A more coordinated and integrated approach is needed. The Major Cities Unit will do just that.

It will work closely with Infrastructure Australia with the aim of making of making our cities more productive, sustainable and liveable.

And the Government is not sitting idle while we wait for the $20 billion from the Building Australia Fund to come on line.

We are meeting each and every one of the election transport commitments we took to the people at the last election.

We are investing $3.2 billion in road and rail projects next financial year, including over half a billion dollars to make an early start to our election commitments.

This investment will improve access to ports, upgrade our interstate network, fix the ‘last mile’ on many key regional freight routes and help ease urban congestion.

Anyone who lives near, or picks up or drops off at our ports would know they suffer from significant infrastructure bottlenecks which prevent them from performing at maximum capacity.

It’s a critical issue for the trucking industry, which for too long has suffered as a result of poor connections from major freight routes to our nation’s export points.

The Government knows we need to make an early start to alleviate this problem, as delays will result in more significant costs further down the track. Prior to Infrastructure Australia beginning its work, we’re funding a whole range of projects.

The Budget contains:

  •  $20 million for the Townsville Port Access Road, so we can make an early start on this important project;
  • nearly $60 million on the Northern Expressway and the upgrade of Port Wakefield Road in South Australia. This project will cut congestion and provide a high quality link between the Sturt Highway and the Port of Adelaide;
  •  funds next year to start planning for the new Bunbury Port Access Road in Western Australia;
  •  $100 million for the Ballina by-pass.

These projects are on top of a $300 million commitment by the Rudd Government for the Moorebank Inter-modal terminal in Sydney that would improve freight movement through Sydney’s west.

We also announced $75 million to kick start a package of planning studies into eight landmark projects in our biggest cities.

In Sydney, we are working with the state government to fund a feasibility study into the possible duplication of the M5, which would drastically improve connections to Port Botany.

In Melbourne, the Government is providing funds so we can take the next steps in improving east-west road and rail connections across the city.

In Brisbane, we are planning for the Gateway Motorway missing links to improve freight and passenger flows, while in North Queensland, we’ve upgrading the Bruce Highway.

Ladies and gentlemen, we all know Australia faces a growing freight task.

Some of you will have heard the statistic that the freight task is expected to double in the period between 2000 and 2020.

Investing in our infrastructure is one mechanism we have at our disposal to meet rising demand on our transport networks, and I am proud of the framework we are establishing to respond to this challenge.

The other area requiring attention is regulatory reform.

At the heart of the Government’s approach to regulatory reforms is taking a national approach to transport policy.

We are doing this in conjunction with the states and territories, because we know in order to deliver real solutions, the Commonwealth cannot go it alone.

By taking a national perspective, by engaging with the states and territories, we will be in a better position to deliver a transport system that supports and enhances our social, economic and environmental prosperity.

At February’s Australian Transport Council meeting, I and my state and territory colleagues laid the groundwork to build a truly national transport policy.

The policy is an important step to modernise our century old federation and build a seamless national economy for the 21st century.

At that meeting I was struck by the genuine level of cooperation between all of the ministers involved, and the common desire to end the blame game which has characterised the relationship between the states and the Commonwealth over the last decade.

When transport ministers sat down again this month we built on this early work by agreeing to take a historic first step towards a truly national transport system.

These reforms are focussed on improving safety and simplifying current regulations.

The next step will be for ministers to consider proposals on a number of key issues when we next meet in July. These include:

  •  A single national system for the regulation of heavy vehicles, including registration and licensing,
  • The establishment of a National Road Safety Council.

And I believe that national regulation of heavy vehicles will be the most self evident overdue transport reform since the National Road Transport Commission was established by Bob Hawke in 1991.

The ludicrous situation where heavy vehicles that move freight across our state borders are faced with different rules, registration charges, fatigue regulations and enforcement regimes must be brought to and end.

The new transport policy will deliver fresh momentum to productivity reforms such as wider adoption of Performance Based Standards, Higher Mass Limits and expanding the B-Triple network.

We can save time and money if we can deliver improved productivity and expand these higher productivity freight routes right to the ports and networks.

And linked to higher productivity is heavy vehicle charging.

Put simply, without the right level of cost recovery from industry there will not be appropriate investment in road networks by governments, particularly to undertake the necessary upgrades to enable the heavier and larger trucks on the roads.

Successive Governments have supported the principle that heavy vehicles should pay their way.

And I know the ATA has shown leadership by supporting this principle.

The Howard Government commenced work back in 2004 when it released a White paper which committed the Commonwealth to reform of fuel excise and registration charges.

The 2006 Productivity Commission study into Road and Rail Infrastructure Pricing found under-recovery of infrastructure costs occurs in the heavy vehicle industry.

In April 2007 the Council of Australian Governments required the National Transport Commission to devise a new charges determination for implementation on 1 July 2008 that:

  •  fully recovers infrastructure costs from the heavy vehicle industry,
  • ends cross-subsidisation between heavy vehicle classes
  • indexes charges to ensure costs continued to be recovered.

Under the direction of COAG the National Transport Commission undertook an in-depth analysis of road expenditure, heavy vehicle charges and road usage.

The new charges determination delivers COAG’s requirement.

The hypocrisy of the Coalition on this issue is breathtaking.

Less than a year ago Mark Vaile, then Federal Transport Minister and Leader of the Nationals championed the very charges being proposed. In a speech given on 28 June 2007 entitled The Coalition Government’s Transport Reform Agenda, said:

“The National Transport Commission (NTC) will develop a new heavy vehicle charges determination to be implemented from 1 July 2008.

The new determination will aim to recover the heavy vehicles’ allocated infrastructure costs in total and will also aim to remove cross-subsidisation across heavy vehicle classes.”

Australian Transport Ministers unanimously adopted the determination earlier this year.

But there are two important differences between the previous Government’s proposal and the one that I took forward. Those differences took into account the views of industry representatives such as the ATA.

The first was that the Road User Charge increase be delayed until 1 January 2009 instead of 1 July 2008.

The second was a $70 million heavy vehicle safety and productivity program which would have allowed us to:

  •  construct more heavy vehicle rest stops and parking areas;
  •  undertake trials of black box technologies relating to driver fatigue and vehicle speed;
  •  bridge strengthening projects, allowing greater access to heavier vehicles.

This package will not only benefit the heavy vehicle industry, it will also help to allay some of the fears people have about the safety of larger trucks on our roads and as all of you have shown today, this is an important objective.

This $70 million package is, however, conditional on the legislation and regulations passing through parliament.

Unfortunately, the Opposition has taken it upon itself to hamper our efforts in the Senate.

This reform has broad support from respected mainstream business advocates such as the Business Council of Australia.

In opposing these measures in the Senate, the Coalition is undermining its own economic credibility.

A sure way to derail ongoing development of the heavy vehicle productivity agenda is to undermine reasonable cost recovery from the industry for legitimate infrastructure costs.

One of the results of the defeat of the legislation in the Senate is that state registration charges are now significantly out of step with the Federal Interstate Registration Scheme.

This is a ludicrous situation which will set back the case of national consistency which we all know is required.

I give you this commitment. I will never say one thing to industry and then do another.

I listened to the ATA and I delivered the safety and productivity package because it was good policy and made common sense.

I appreciate honesty and plain speaking and know it will provide a strong platform for the relationship between the Rudd Government and the ATA.

From time to time we will have minor disagreements but I am absolutely confident that we will have a constructive relationship for many years to come.

Ladies and gentlemen, the Government has a big infrastructure agenda.

The Government knows that if we don’t act now, the costs of inaction will continue to rise, and they will be felt by all sectors of the Australian community.

Including, of course, Australia’s trucking industry.

We have put in place Infrastructure Australia, established the $20 billion dollar Building Australia Fund, and are developing a truly national transport policy.

We will build on these initiatives in the years ahead, and I look forward to trucking industry’s involvement as we do this.

I’m confident that by working together we can continue to grow the prosperity of your industry, and put in place the reforms necessary to keep Australia moving forward.