Oct 10, 2011

Speech to Ports Australia Dinner – Transport Reform Agenda

Hyatt Hotel, Canberra


As you know, the Government has a strong commitment to the broad maritime industry and to improving our national freight systems of which the nation’s ports are a vital part.

I believe our policy and reform actions over the last 18 months have placed ports and port-related issues firmly in the policy spotlight.

I would like to use tonight as an opportunity to hear your views on how industry and government can collectively progress measures that will bring those vital long-term benefits to our economy.

To that end, it is worth recapping on what we have done as a Government in the freight transport sector.



I’ll start with the Ports Strategy that was developed by Infrastructure Australia and the National Transport Commission.

The Strategy acknowledges the significant progress State and Territory Governments have made in longer-term planning for ports, but really seeks a collective approach by all levels of government to promote the productive capacity and effective functioning of ports.

Ensuring that ports take their real place as the cornerstone of a more productive national freight system, needs:

  • Clear and transparent planning that also considers port expansion, port links and integrated transport;
  • Consideration of the decision-making, planning and functions of those who operate within ports, regulate ports, rely on ports or are affected by their operation; and
  • A clear focus on performance, reporting and transparency by relevant bodies that interact with ports.

Australian Transport Ministers agreed earlier this year to submit an updated National Ports Strategy to COAG after final consultation.

When agreed, it will be an important step in ensuring the success of the strategy.



But the Ports Strategy alone won’t achieve real change.

The National Land Freight Strategy that is currently under development proposes the development of one integrated system — a national transport network that includes roads, rail, ports and airports.

It will build on one of the key elements of the ports strategy – the identification that the land-side operation of ports represents the biggest, and fastest rising, cost factor in the container transport chain.

Again, a national approach is imperative.

A national land freight network will reduce congestion and provide opportunities for investment.

A segmented network is costly and we have 200 plus years of separate transport systems to redress.

A national approach will overcome segmentation issues that are barriers to our freight productivity including:

  • Eight separate approaches to freight and network strategies;
  • Poor interoperability and reliability across infrastructure networks, modes and jurisdictions; and
  • Inconsistent regulation and planning and often, a lack of innovative approaches to make change for the better.

At its simplest, the strategy will be a map of Australia that clearly identifies a national freight network; for our ports, our airports, our road and rail arteries and our intermodal and freight cluster sites.

That map will clearly set out:

  • our inter-operability requirements,
  • existing and future network features,
  • major freight routes and freight precincts, and
  • potential pinch points that inhibit growth.

The strategy will aim to make this map a seamless access network.

Long term, the strategy is focused on improved high productivity vehicle capability and access, modern operating procedures, harnessing smart technology, separating freight from personal transport and driving a focus on performance and best practice.

And if that’s not enough, it will also need to:

  • identify optimal routes, precincts and terminals to serve major cities and regional centres;
  • develop truly long term infrastructure planning that promotes private investment;
  • create a road improvement regime that facilitates investment by the freight industry and the industry’s customers;
  • examine road and rail pricing; and
  • consider planning requirements for modal and intermodal terminals.

The task is ambitious and I will be honest and say that reform of the freight network will test the cooperative will of governments because it requires support from all governments.

But we’ve managed to get agreement on national transport regulators – an unprecedented reform and one that builds a sound base for progress on a national freight approach.



And finally, but by no means least, to the Government’s shipping reforms.

You will have heard me say that it just doesn’t add up that Australian business participation in international shipping is almost non-existent and that our Australian flagged coastal shipping operations are in terminal decline.

Rebuilding the shipping industry is a priority for the Gillard Government.

Without those reforms, we run the real risk of becoming nothing more than the customers of others.

Australia must be a participant in international shipping, not just a customer.

We need to look for opportunities to value-add in the supply chain.

Exporting our iron ore, coal and LNG on Australian flagged ships would achieve that.

So we’re taking real action by implementing a package of taxation, regulatory and skills reforms as I announced on 9 September.

Those reforms, together with our ports and freight initiatives, will stop the decline of the Australian maritime industry.

They will create a platform for new investment with enormous potential for new jobs, opportunities and productivity that will benefit the nation as a whole.

I know workforce skills is a major concern for the shore-based sectors of industry as much as it is for the seagoing sectors, so let me give you some details on what we’re doing on that front first.

You will have heard that I am establishing a Maritime Workforce Development Forum that will work to address the priority skills issues.

The Forum will be a maritime industry Forum, not a shipping industry forum.

I want key players across the breadth of industry to work together to address the skills issues.

The Industry Reference Group I established and which David was a key part of has set out some key priorities for the Forum to tackle.

Those priorities are measures like:

  • A strong and agreed data and evidence base on the criticality of the industry’s skills needs. That evidence will help industry access existing Government skills and training resources.
  • An industry-wide workforce plan that puts actions in place to address the skills needs – this will cover shore and non-shore based roles; and
  • Developing a more national approach to training and skills outcomes, rather than sector-based or state-based approaches that currently exist.

The Forum will be ready to start work from 1 January 2012 and I expect Ports Australia will have plenty of input to the Forum’s activities.

I strongly encourage that input from the ports sector.

We need to build a maritime cluster, not just a shipping industry.

The taxation reforms I announced will make our shipping sector competitive.

  • An tax exemption for income from eligible vessels and shipping activities will reduce costs for Australian registered ships;
  • A ten-year accelerated depreciation regime will stimulate investment in new ships and in the renewal of existing ships;
  • And a tax concession for eligible seafarers engaged in the international trades will reduce operating costs and support Australian shipping in international markets.

The licensing reforms will provide clarity, transparency and certainty for all shipping operators.

  • Australian registered operators will be supported by a General licence that allows them unrestricted access to coastal trades and access to taxation incentives;
  • The necessary role of foreign vessels will be managed by a voyage-limited Temporary Licence; and
  • Emergency licences will support ship movements in real emergency situations.

Importantly, establishing an Australian International Shipping Register will provide a competitive registration option for Australian companies engaging in the international trades.

International register vessels will be able to employ mixed crews and provide employment rates and conditions that are internationally competitive.



I know you might have heard me say some of this before but good policy and good reforms bear talking about.

I believe in this work, in these policies and in these reforms.

And I want all parts of industry to have their say on them.

But more importantly, I want industry to contribute to developing and implementing solutions.

An integrated approach requires all players to take part.

I have worked hard with my Cabinet colleagues to get key reforms through at both Commonwealth and COAG levels.

So I’m happy to hear from you tonight about how work in this particular and vital part of our maritime and freight industry – ports – can help me to take these reforms forward.

Thank you again for the chance to be here with you.