Australia has a unique opportunity to use its G20 chairmanship “to lead the world in relation to infrastructure investment and particularly in infrastructure planning”, according to Treasurer Joe Hockey. But perhaps this grand, global ambition, announced to the ABC’s Insiders (or was it the “nation building” satire Utopia?) from the power citadel of Washington, would have more credibility if Australia first addressed some of the glaring infrastructure shortcomings in its own backyard. 

Speakers at a Melbourne conference on October 10 told how Victoria’s run-down and isolated rail freight network is: preventing competition between train operators; causing derailments; slowing trains down; discouraging investment in efficient rolling stock; allowing unfair terms for customers; and forcing freight that should be moved by rail onto trucks.

Neil Johns, who runs GrainCorp’s storage and logistics division, told the 2014 Rail Freight Conference that new rail operators wouldn’t invest in new, larger grain wagons in broad gauge because they wanted to send wagons interstate (where railways are standard gauge) when they weren’t needed for Victorian harvests. Johns said grain storage, loading and port facilities were only used to 35% of their capacity, and that poorly maintained tracks were unable to bear the weight borne elsewhere by modern trains. “The bottleneck is the rail issue,” he said. “Loading grain trains in Victoria is a nightmare.”

While a different track width protects most of the Victorian network from new competitors based interstate, dominant operator Pacific National (part of Asciano) is able to enforce inflexible “take-or-pay” contracts requiring customers to pay for train services (typically three per week) whether or not they are needed. Ken Wakefield, managing director of Merbein-based Wakefield Transport, said take-or-pay contracts were largely responsible for his company entering into voluntary administration in the mid-2000s when drought meant there was little cargo to carry (it has since emerged to become a major Sunraysia logistics company).

There are some bright spots on the horizon for the state’s rail freight sector, however. By separating the lines they run on, the behind-schedule Regional Rail Link will improve the movement of Werribee line metropolitan and freight and V/Line trains between Melbourne and Geelong. Premier Denis Napthine’s government also has signed off on the standardisation and upgrade of the line connecting Mildura to the ports of Portland, Geelong and Melbourne, with a budget stretching to $220 million. (However, winners and losers from the so-called Murray Basin rail project will depend on which of four route options through western Victoria is chosen.)

More flexible train scheduling is one of the benefits Wakefield expects when the standardised Mildura line entices new rail operators into Victoria. Another gain will be greater load bearing (to 21 tonnes per axle, an extra 300-400 tonnes per train), which can’t come soon enough for Wakefield, whose business sustained a derailment caused by track damage from the 2011 floods that left stranded a customer’s $1 million citrus crop near Ouyen in August 2013.

Both sides of state politics say they are committed to standardisation, along with a growing network of intermodal terminals, under similarly gradual approaches. But there is no timetable — simply a priority order of lines for conversion.

Indeed, Victoria’s commitment to standardisation has been questioned by former deputy prime minister and train buff Tim Fischer, who told the conference the Napthine government was “leaning towards broad gauge” for its proposed Tullamarine Airport rail link (allowing trains to run directly on to the metropolitan network), which he deplored because it then would be incompatible with the planned Melbourne-Brisbane inland rail line.

Victorian Transport Minister Terry Mulder was scheduled to speak but was replaced by his junior minister, parliamentary secretary for transport Gary Blackwood, who referred to his background in road freight, inevitably provoking a question about the higher taxpayer-funded subsidies and lighter regulation enjoyed by trucking companies compared to rail operators. But no greater commitment to rail freight can be expected if Labor wins office on November 29, after ALP freight spokesperson Natalie Hutchins made it clear that funding TAFEs, schools and hospitals would be the priorities of an Andrews government, offering only a dedicated freight ministry and an Infrastructure Victoria agency to depoliticise major projects.

Geoff Smith, managing director of SCT Logistics, summed up the difficulty of bringing freight issues onto the media’s radar screen in the looming state election: “Trains don’t vote and it takes a media-savvy government to persuade voters that one of the best ways to protect their lifestyles is to invest in [regional] rail.”

In the fraught freight debate, with its parochial and often conflicting interests, there’s been little savvy on display on so far.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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