The Australian rail freight industry’s frustrations and hopes have been catalogued in a detailed productivity review

The National Transport Commission (NTC) is an independent body tasked by the Australian Transport Council (ATC) to provide advice to state and Federal Transport Ministers on regulatory and operational reforms. Its latest review, conducted in parallel with supply chain pilot studies that investigated coal, grain, intermodal and livestock supply chains, concentrates specifically on identifying reform opportunities to improve productivity within the rail sector.

Five main areas of impediment were identified: Policy, planning and investment; economic regulation and market structure; environmental, safety and technical regulation and standards; human capital; and productivity measurement.

The analysis across the freight rail industry has shown that further work is necessary and that there is a role for government in addressing productivity impediments in the rail sector,” the NTC says.

Most importantly, as a high priority, governments should:

• Develop more coordinated and transparent frameworks to facilitate planning and investment within the rail industry and build on the planning and investment already undertaken by governments individually.
• Work with industry to ensure that policy objectives for funding being provided are met. This will require reciprocal obligations from industry in terms of ensuring government subsidies are used efficiently and providing adequate information to governments regarding funding outcomes and expected future investment requirements.
• Improve efficiency across the transport sector through the progression of the Council of Australian Governments’ Road Reform Plan and development of a nationally consistent regulatory model for access to strategically important terminals.
• Continue to work towards implementation of a single national rail safety regulator and investigator to deliver a nationally consistent rail safety regulatory framework.
• Develop comprehensive productivity indicators for the rail sector.

Looking specifically at a couple of these recommendations, NTC wants coordinated and prioritised transport objectives across all levels of government and government-owned corporations to ensure consistent and cohesive implementation. A fundamental part of this will be a long-term ports and freight strategy to undertake coordinated planning and investment across governments and encourage private investment in transport infrastructure.

This strategy should address the interaction between rail planning and planning for other interests, including land use planning, supply chain interfaces, passenger and freight conflicts, existing transport market distortions and social objectives, and take a national focus where necessary,” NTC says.

Productivity data
The NTC’s review admits its task was made more difficult by the lack of available freight rail productivity data and thus wants comprehensive productivity indicators developed by the Bureau of Infrastructure, Transport and Regional Economics and made available across governments and industry. BITRE is well placed to undertake this work as it already publishes a number of rail performance indicators in conjunction with the Australasian Railway Association (ARA).

NTC believes this should be done in conjunction with the Standing Committee on Transport Sub-Committee responsible for transport data collection and research.

Governments should investigate mandating the provision of data from rail businesses where necessary to ensure adequate industry data is available for undertaking meaningful analysis. The collection of rail productivity data should also be undertaken with a supply chain focus to enable policy and planning to occur across all modes,” it says.

Industry can also play a strong role in improving productivity through developing and adhering to technical, operational and environmental industry standards and working to improve coordination along the supply chain, NTC concludes.

Source: Extracts from World Cargo News – October 2009