Speech to Ports Australia Biennial Conference in Adelaide “Driving a national focus on ports and shipping”
Today marks the fifth time I have addressed a Ports Australia event as Minister for Infrastructure and Transport.
On each occasion, I have outlined the Government’s vision for ports in Australia.
Our vision for planning which recognises the strategic importance of ports to our national economy.
A vision which considers the entire supply chain.
A vision which recognises the importance of land transport connections to our ports.
A vision which recognises the importance of freight transport corridors.
In short, our determination to work with industry to revitalise Australia’s shipping and freight logistics industry.
If we are to meet the challenge of growth we must move away from ports being treated like islands; unconnected from broader planning and transport links in the cities and regions where they are sited.
NATIONAL PORTS AND FREIGHT STRATEGIES
That is why this Government has put in place a plan that ensures we are well-positioned to provide the facilities and supply chain infrastructure to meet the expected growth of Australian exports.
Central to this plan are the National Ports Strategy and the National Freight Strategy.
An important step in this process was achieved recently when the Council for Australian Governments endorsed the National Ports Strategy.
A key objective of the strategy is improving long-term coordinated planning around future ports capacity, transport corridors and shipping channels feeding our major ports
Early this month, I released the nation’s first ever National Land Freight Strategy, a long term blueprint for a streamlined, integrated and multimodal transport system capable of moving goods into and out of major ports and around our country quickly, reliably and at the lowest cost.
The Strategy, which was developed by Infrastructure Australia, gives us a unique opportunity to fix the regulatory and infrastructure failures which have to some extent held back our miners, manufacturers and farmers and cost the Australian economy tens of billions of dollars in lost export earnings.
The Strategy is underpinned be a number of key principles:
One national, integrated network, replacing fragmented, ad hoc decision-making with a proper, long term planning approach that identifies the existing and yet-to-be built roads, rail lines, intermodals, ports and airports which together form a workable, truly national freight network.
This process endeavours to protect current and future transport corridors and other strategic pieces of land from urban encroachment.
The second principle is better use of our existing infrastructure through measures including managed motorways, fitting new technology to improve traffic flows along major motorways, using higher productivity vehicles, creating dedicated freight routes and separating passenger trains from freight trains.
The Strategy’s third principle encourages fairer, more sustainable financing arrangements be developed to address Australia’s future infrastructure needs.
While in recent years there’s been a surge in spending on the nation’s roads, railways and ports, building and maintaining a network fit for purpose requires mechanisms for ensuring the right investment occurs in the right place at the right time.
This Government is committed to ensuring we have the national infrastructure, planning systems and regulatory frameworks we need to move freight efficiently between our key transport hubs.
With the blueprint for port related infrastructure is in place it is now up to ports authorities and the like to engage in the process.
Obviously, those who are best prepared will be best positioned to attract public and private investment in their respective port related infrastructure plans.
BITRE AUSTRALIAN SEA FREIGHT 2010-11 STATISTICAL REPORT
It is appropriate that at the Ports Australia Biennial Conference I am releasing the BITRE Australian Sea Freight 2010-11 Statistical Report.
This Report is another piece of economic data that confirms Australia’s economy is the envy of the world.
In 2010-11, Australian exports by sea were $222.6 billion, a 24.4 per cent increase on 2009-10 and an average annual growth of 10.7 per cent between 2005-06 to 2010-11.
While Australian imports were $160.9 billion in 2010-11, a 2.5 per cent increase on 2009-10 and an average annual growth of 5.5 per cent between 2005-06 to 2010-11.
Cargo moved across Australian wharves between 2005-06 to 2010-11 grew by 6.2 per cent per annum.
International exports accounted for 81.8 per cent of this cargo.
Total international cargo, by value, handled by Australian ports increased 14.2 per cent in the same period.
Over the five years to 2010-11, the total ports call by cargo ships increased by 2.3 per cent per annum, while port calls by cargo ships from overseas increased 4.2 per cent per annum.
In case you have been wondering, Ports Australia’s members have been very busy.
MOOREBANK INTERMODAL TERMINAL
I want to take this opportunity to mention the Moorebank Intermodal Terminal.
This project is a perfect example of how the national ports and freight strategy can be combined to deliver genuine freight transport efficiency and better transport outcomes for our cities.
With Port Botany freight expected to grow at seven per cent per annum, Moorebank will generate at least $10 billion in economic benefits, remove 1.2 million trucks each year off Sydney congested roads and create 1700 long term jobs.
The size of this unique site means that trains up to 1.8 kilometres in length can operate at the terminal.
The Moorebank Intermodal terminal will deliver both a port shuttle in July 2017 to address short-term capacity constraints, as well as an interstate terminal after that to meet future freight growth requirements.
Recently, with Finance Minister Penny Wong, I announced that the Government is seeking experienced people to form a board for a Government Business Enterprise to deliver the intermodal.
The GBE will oversee remediation of the site and manage the tender process to select the company or consortium that will design, build and operate the new facility.
Moorebank is a perfect example of the Federal Government using its assets to unlock private investment, so vital if we are to solve some of our biggest challenges in Sydney.
This project delivers what many of you have argued for – the Commonwealth using its urban land holdings and programs to unlock opportunity for private financing of the big transformative projects that will shape our economy and our cities.
It is also about the Commonwealth taking on some of the risks that the private sector won’t wear.
The productivity gains will be considerable with thousands of jobs created during construction and then on-going.
Importantly, it will remove 3,300 trucks each day off the road, reducing congestion and improving air quality for the people of Sydney.
Moorebank will complement our work disentangling the freight and passenger lines along Sydney’s northern and southern rail corridors plus the major program of works to improve the rail network at Port Botany.
These all form a broader investment program to create a seamless national economy.
We are carefully and deliberately targeting the bottlenecks and the congestion that cost our economy billions of dollars in lost productivity.
Moorebank will be a case study in how infrastructure can link our ports, drive productivity and improve logistics, all the while creating long-term efficiencies, employment and environmental benefits.
AMSA – NATIONAL REGULATOR FOR COMMERCIAL VESSEL SAFETY
Another critical element of the Government’s efforts to ensure a more efficient freight transport industry is our historic reform of the Nation’s transport regulators.
On 1 January 2013, Australia finally gets three national transport regulators; one for rail, one for heavy vehicles and one for the maritime industry.
This will see the number of transport regulators operating across Australia reduced from 23 to 3.
This reform will boost national income by up to $30 billion over the next 20 years.
It will significantly reduce the red tape transport operators in all three modes experience.
It means interstate rail operators won’t have to deal with seven separate regulatory authorities, 46 pieces of State/Territory and Commonwealth legislation including seven rail safety Acts, nine Occupational Health and Safety Acts and seven dangerous goods Acts.
Heavy vehicle operators will no longer have to operate under nine separate regulatory regimes, including drivers no longer having to carrying multiple driver log books if they operate interstate.
For the maritime industry this means that for the first time in its history, Australia will have a single national regulator for commercial vessel safety – and AMSA will be the national maritime safety regulator.
In practical terms this will result in getting rid of 50 pieces of legislation in 7 jurisdictions; one National Maritime Safety Regulator – replacing 7 State/Territory regulators; one National system for commercial vessel safety – allowing the seamless movement of domestic commercial vessels and crew around the country.
This will ease the burden of red tape, increase regulatory confidence, remove inconsistency in the law applying to Australian commercial vessels and streamline new maritime safety plans.
In terms of sheer numbers alone, this increases AMSA’s responsibilities from around 6 000 to 30 000 vessels.
This is a mammoth task but I know that we are in safe hands and the economic productivity benefits are undeniable.
RE-WRITE OF THE NAVIGATION ACT
I also want to comment on the massive overhaul and re-write of the Navigation Act 1912.
The Navigation Act is the primary piece of legislation by which the Australian Government regulates the maritime industry – particularly large vessels.
It was imperative that the 100 year old Act be overhauled and brought into the 21st Century.
This was a complex piece of work that involved rewriting one of the oldest laws on our books including amending 29 related pieces of legislation.
The new Act was unanimously passed by the Parliament last month.
The rewritten Navigation Act, the national regulators and the shipping reforms demonstrate this Government’s commitment to ensuring that our industry has modern regulatory frameworks to operate and compete in.
Finally, I want to mention the Government’s delivery of the shipping reforms.
These are the most significant reforms of Australia’s shipping industry since 1912.
There are four key elements to the package.
First, tax reform to encourage investment in new and more efficient ships to enhance the industry’s productivity, including a zero tax rate, accelerated depreciation, rollover relief, refundable tax offset for employing Australian seafarers and the removal of the Royalty Withholding Tax.
Indeed, last week, the first certificate for claiming accelerated depreciation was issued.
Similarly, Jebsens have recently introduced the M/V Surenes (pronounced Sure Nes), a new multipurpose vessel directly from a Chinese Shipyard, to service their WA Government coastal service contract.
The Surenes commenced on the West Australia coast on 27 August and represents a doubling of capacity compared to the previous ship providing that service.
Jebsens advises that the recent Federal Government shipping initiatives and in particular the removal of the Royal Withholding Tax played a part in the overall evaluation in the decision for this vessel.
Second, an Australian International Shipping Register to help grow our international fleet.
Companies which place vessels on the AISR will be eligible to receive the Government’s tax and fiscal incentives.
In addition to reducing the cost of owning and operating an Australian ship, international labour terms and conditions will apply to seafarers working on board AISR vessels on international voyages, with a minimum safety net provided through the application of the International Labour Organization’s Maritime Labour Convention.
AISR vessels will be able to hire foreign seafarers; though two senior officers, preferably the master and chief engineer, have to be Australian.
The combination of a zero tax rate and internationally competitive employment conditions means AISR vessels can compete with international ships registered in a variety of jurisdictions, without reducing Australia’s enviable maritime safety and environmental standards.
These arrangements are designed to encourage investment in an Australian international fleet.
Third, a new licensing regime to provide clarity and transparency to enable long-term planning and set clear boundaries around the necessary role of foreign vessels in our coastal trade.
To assist the industry in understanding and maximising the benefits of the reforms I have asked my Department to undertake industry briefing sessions, the next one is in Sydney tomorrow, and to have dedicated officials work with major shipping companies in understanding the shipping reform legislation.
It is important that industry understands and maximises the benefits of the shipping reforms which are designed to assist investment in Australia’s shipping future.
Fourth, the establishment of a Maritime Workforce Development Forum to progress training to help us build a highly skilled maritime workforce.
The Forum, which is comprised of representatives from across the maritime sector, met for the first time in February this year.
I don’t have to tell you that workforce skills and training is one of the biggest challenges facing your industry.
The maritime sector, like many other industries, is faced with an ageing workforce.
42 per cent of our seafarer workforce is aged 51 years or older — we need to find ways to make a career in shipping, a career of choice.
As shipping traffic increases, efficient port operations will become ever more critical, so too will our need to enforce strict safety and environmental requirements.
In order to do this, highly skilled seafarers will need to fill critical roles such as port masters, pilot and inspection roles with our maritime safety regulators.
We need to recruit, train and retain our future maritime workers now.
The Forum is working to address priority issues such as the development of a mandatory training requirement and the development of a national approach rather than sector or state-based approaches that currently exist.
The Forum will also provide advice to the Government about how we can better use existing Government skills programs and funding sources.
Like all major reforms, the benefits will take some time to be fully evident but the early signs are very positive.
The maritime industry is one of the world’s oldest and most important global industries.
Only through high level cooperation and coordination can we ensure effective management and ongoing sustainability.
This is true of all our transport and infrastructure issues.
The solutions to our transport and logistics challenges, now and in the future, involve shipping, road and rail transport, it involves our ports and airports and it requires strategic, integrated, planned sea-side and land-side national plans.
Critically, it requires investment both public and private.
As a Government we have provided national plans for ports and freight, we have created the regulatory and fiscal framework that supports the revitalisation of the shipping industry and we have invested record amounts in the nation’s infrastructure.
It is now over to you, business, to harness these opportunities, to make the investments, to ensure Australia’s productivity and prosperity continues to grow.