The Business Chamber submission to:

Transport for NSW

DRAFT PORT AND FREIGHT STRATEGY

March 2013

Illawarra Business Chamber p: 02 4229 4722 e: [email protected] Illawarrabusiness.com.au | Facebook.com/Illawarra.Business | Twitter.com/IBC_Illawarra

Executive Summary Introduction The Illawarra Business Chamber (IBC) welcomes the opportunity to comment on the Draft NSW Port and Freight Strategy (the Strategy) developed by Transport for NSW (TfNSW). This consultation process is a welcome opportunity to contribute the experience of our members into the development of Government policy.

The IBC is a member-based not for profit business support organisation, with over 700 members across the Illawarra. As the leading business organisation in the region, the IBC is committed to representing the needs of business at a local, state and federal level, advocating on behalf of its members to create a better environment for commerce and industry.

The IBC has contributed to the debate around freight and transport infrastructure over many years, engaging with local and regional stakeholders, and publishing a number of papers and submissions on the key priorities for the business community in the region.

IBC supports the underlying concept that any reform in this area is not just about building new infrastructure – there are also opportunities to improve the efficient use of the existing network. This includes addressing key issues such as local delivery time restrictions, managing the freight/passenger rail freight challenge, addressing potential increases in vehicle sizes in non- residential areas and learning from the Hunter experience by improving co-ordination across the entire NSW freight system.

The Strategy highlights that improving freight movements in NSW will need the involvement of both the public and private sectors. Private sector engagement will be improved once the Government makes firmer commitments to specific policy changes and projects. Until that time, many businesses involved in the freight sector are unlikely to adjust their operations.

This submission confirms the port and freight infrastructure priorities for the Illawarra, identifies the rail and road infrastructure upgrades required to maintain regional competitiveness, and comments on the Port Kembla Growth Plan and the Regional infrastructure model proposed by the Strategy.

The key recommendations outlined in this submission are:

1. IBC welcomes the NSW Government efforts to obtain funding from the Australian government from National Building Program Round 2 for the above listed road projects.

Illawarra Business Chamber 2

Similar commitment is needed for Maldon-Dombarton and the mainline acceleration program on the Illawarra line. 2. The NSW Government should commit to helping to deliver and attract funds from the Australian Government to help deliver the Maldon-Dombarton freight line. 3. The NSW Government needs to undertake risk assessment of having a small number of highly utilised strategic freight corridors into the Illawarra. Incidents on the shared Illawarra line and Mt Ousley could have significant implications across the freight network. 4. TfNSW should include the Port Kembla Outer Harbour Rail Master Plan into the analysis and action plans in the Final Port and Freight Strategy. 5. TfNSW should commit to developing Regional infrastructure models across NSW, and provide greater detail on how these regional plans will be developed and align to other regional transport, planning and infrastructure strategies. 6. Greater detail is needed on how the NSW Government intends to reform road funding in order to provide some certainty for businesses. 7. TfNSW should consider using the University of SMART Infrastructure Facility to undertake any systems analysis to optimise efficient use of freight network.

Illawarra freight task The IBC recognises that the freight task is extremely important for the economic sustainability of NSW and that effective planning and infrastructure is essential given the freight task is expected to double over the next 20 years. Reliable and efficient transport links allow businesses in the Illawarra to get their goods and services to , the rest of Australia and the world, which means jobs and a prosperous future for the region.

The Illawarra is the third largest regional economy, worth in excess of $16bn per annum. With the close proximity to Sydney and the presence of the Port of Port Kembla, the region plays an important role in the NSW freight task. The key freight corridors and infrastructure in the Illawarra include:

 Port: Port Kembla is a major trading port, exporting steel, coal and grain amongst other products, and importing motor vehicles.

 Rail: the Illawarra shared passenger and freight rail line is one of the busiest long distance commuter lines in NSW and is nearing capacity with limited freight paths available;

Illawarra Business Chamber 3

Maldon- Dombarton freight line project, on which planning and pre-construction development has recently commenced.

 Road: The primary freight roads through the Illawarra are the F6 / Mt Ousley Corridor, which provide the only access route for B-doubles into the Illawarra from the North; the Pacific Highway; Picton Road; and Bulli Pass.

In the Illawarra, like much of NSW, historic underinvestment in rail freight means the region will struggle to meet the freight task demand which is expected to more than double by 2031. The main priority for the region is to achieve the Strategy’s Action 2C to ‘enable separation of passenger and freight flows on the rail network’ through the construction of Maldon-Dombarton, which is discussed further below.

The IBC is pleased to see the commitment by TfNSW to obtain National Building Program Round 2 funding for the following road projects, in addition to the Road Safety Treatment projects already funded for Picton Road:

 F6 – Masters Road Interchange: Seeks planning funds to enhance the capacity of this

section of the F6 to provide three lanes in each direction for the full length of the F6 between Five Islands Road and Mt Ousley Road (7km distance).

 Mt Ousley: The initiative is for the construction of four additional climbing lanes on Mt Ousley Road between Picton Road and Bulli Pass, options for the construction of a grade-separated interchange at the junction of Mt Ousley and the Southern Freeway, and the construction of a third southbound lane from the existing arrestor bed to the junction of Mt Ousley Road / the Southern Freeway. RMS commenced planning for additional climbing lanes on Mt Ousley Road with $800K allocated in the NSW FY12/13 Budget.

– Bulli Pass major upgrade: Funding is sought for planning

activities to develop options to upgrade Bulli Pass, which is the only feasible alternative road option to Mt Ousley. Following a major upgrade, Bulli Pass would be an efficient, high quality and high productivity freight route.

 Princes Highway: The Gerringong to Bombaderry upgrade will complete a four lane arterial road between Waterfall and the turn off to Jervis Bay.

Illawarra Business Chamber 4

If successful in securing funding, these projects should ensure sufficient capacity for road freight into and out of the Illawarra. The IBC are of the view that TfNSW should demonstrate similar commitment to securing Commonwealth funding to commence construction of the Maldon- Dombarton rail link and the mainline acceleration program on the Illawarra line to decrease journey times from Wollongong to Sydney to 60 minutes.

IBC welcomes the NSW Government efforts to obtain funding from the Australian government from National Building Program Round 2 for the above listed road projects. Similar commitment is needed for Maldon-Dombarton and the mainline acceleration program on the Illawarra line.

Opportunity to separate road and rail freight task: Maldon – Dombarton The Strategy identifies the need to invest in rail freight infrastructure as the shared rail network does not have the capacity to meet growth forecasts. The priority of passenger transport on shared rail lines will see a decline in available freight paths, increasing costs and reducing business competitiveness. The Strategy also rightly identifies the objective to shift an increasing share of road freight to rail and to separate the road and rail freight task.

Both priorities are of crucial importance to ensuring efficient freight operations in the Illawarra. The IBC welcomes the pre-construction activities for the Maldon to Dombarton Rail Link which are being progressed by TfNSW through $25.5 mill of funding provided by the Commonwealth Government. However, given the above stated objectives, it is disappointing that the Strategy does not make a commitment to the delivery of the project.

Given the existing capacity constraints on the shared Illawarra line, Maldon-Dombarton is critical to meeting the forecast increases in freight. By providing a dedicated freight rail line connection, Maldon-Dombarton would support the expanding resources sector by giving the mining sector alternate access to Port Kembla. Additionally, it would enable Port Kembla to provide overflow capacity for Port Botany’s container business and provide a more reliable link between the south west and western coal mines and the rest of the eastern seaboard.

Additionally, Maldon-Dombarton will enable improvement of the Illawarra passenger services. It is estimated that 20,000 people commute from Wollongong to Sydney CBD daily. The quality and travel time of public transport options between Wollongong and Sydney directly influence access to jobs and income for residents and businesses across the region.

Illawarra Business Chamber 5

The Infrastructure NSW State Infrastructure Strategy identified a pilot of the mainline acceleration project on the Illawarra line over the next five years, to reduce travel times from Wollongong to Sydney to 60 minutes. Reducing the freight task of this line would not only achieve efficiency benefits for the freight task, but will also enable improvements to address unstable geological issues and remove the gradient requirements needed for the heavier coal trains.

The IBC understands that the Maldon-Dombarton line will be built via either private or Federal Government funding. However, the lack of commitment from the NSW Government for the project is damaging the likelihood that funds will be able to be attracted from these two sources. The NSW Government may not be the decision-maker or funder on this project – but it needs to play a stronger role in encouraging Federal or private sector investment by placing it higher up the priority list, including in the next NSW Government submission to Infrastructure Australia.

The NSW Government should commit to helping to deliver and attract funds from the Australian Government to deliver the Maldon-Dombarton freight line.

Risk management on road and rail links between Illawarra and Sydney The Illawarra has strategic infrastructure freight corridors that help support freight movements into and out of Sydney and across the State, the shared Illawarra rail line, Mt Ousley / F6 and the Princes Highway. These corridors are nearing capacity and require upgrades in order to meet the statewide projected freight task. The IBC supports the list of road upgrades mentioned in the Infrastructure Program of the Strategy, and encourages TfNSW to continue to advocate for funding for these projects.

Risk management is also a challenge for the freight task in the Illawarra. Currently, there is only one shared passenger/freight rail line (the Illawarra Line) and one major road (Mt Ousley) capable of carrying large trucks linking the Illawarra with greater Sydney. This means that an accident on either of these links can throw the freight network into disarray. Freight movements need to be able to be made reliably which makes the Illawarra’s dependence on such a small number of heavily used freight routes a barrier to attracting more freight activity to the region.

There may also be an opportunity for the Port and Freight Strategy to allocate funding to improve alternate freight links. For example extending Memorial Drive (previously known as the Northern Distributor) directly to the base of Bulli Pass could increase capacity on this alternative

Illawarra Business Chamber 6

road link to Sydney for some heavy haulage, in the event that Mt Ousley was blocked due to an accident.

The NSW Government needs to undertake risk assessment of having a small number of highly utilised strategic freight corridors into the Illawarra. Incidents on the shared Illawarra line and Mt Ousley could have significant implications across the network.

Port Kembla Growth Plan The IBC welcomes the development of the Port Kembla Growth Plan. The long term leasing of this important piece of infrastructure has caused some uncertainty in the community and the IBC is keen to see this plan completed as soon as possible so that community can better understand the long term plans for the role of Port Kembla in the NSW freight system and the implications of the long term leasing.

The Strategy identifies that the rail at Port Kembla will face capacity constraints. Currently 70 per cent of coal is currently transported by rail, and forecasts estimate the coal freight task will more than double from 167 Mtpa in 2011 to 367 Mtpa by 2031. It also identifies that the significant growth in rail movements to and from Port Kembla will be a key determinant of how much latent rail capacity the NSW regional network has to support growth in Port Botany cargo movements1.

Given this interconnectedness of the rail capacity at Port Kembla with the rest of the State network, the Port Kembla Port Corporation are particularly concerned that there is no mention made of the Outer Harbour rail master plan in the Strategy. The Outer Harbour Rail Master Plan analyses and recommends the optimum rail layout in the Outer Harbour to service the potential growth in bulk trades and containers. The plan, to tie in with the Outer Harbour Master Plan, investigates ways in which the Port can most efficiently utilise the rail network within the port.

In developing the Port Kembla Growth Plan it is important that there is close consultation with the community, and no duplication with work already undertaken by the Port Kembla Port Corporation. The Growth Plan also needs to strategically align with other regional plans for transport, planning and infrastructure.

Finally, the stated commitment in the Strategy that Port Kembla has been identified as the location for the development of a future high intensity container terminal to augment the

1 TfNSW 2012, Draft NSW Freight and Ports Strategy, November 2012, p.71

Illawarra Business Chamber 7

capacity of Port Botany when required, also highlights the need to effectively plan for significant rail capacity upgrades. Port Kembla is better placed to become the overflow port for containers, than Newcastle – which was designated to take on this role under the ‘three ports plan’ of the previous NSW Government. It is geographically closer to western Sydney and the major intermodal terminals (Ingleburn, Minto, Moorebank, Chullora and Enfield) than Newcastle.

TfNSW should include the Port Kembla Outer Harbour Rail Master Plan into the analysis and action planning in the Final Port and Freight Strategy.

Regional infrastructure model The IBC welcomes the notion of the introduction of a regional infrastructure model. This would help to address issues of uncoordinated and inefficient infrastructure provision and management. The Illawarra, like many areas of regional NSW, is facing an infrastructure backlog. As the third largest regional economy in NSW, this places significant risk to the competitiveness and growth of the region and the State.

The IBC agrees that regional road and rail infrastructure needs an integrated asset management plan, without which results in fragmented asset management plan and uncoordinated subsidisation of road and rail. However, it is disappointing that there are no actions to support this objective outside of the best practice model for Cowra, which is relatively low on the list of priorities.

It is important for TfNSW to articulate how the regional infrastructure model will work with other State and Federal Government plans and strategies, such as the Regional Transport Plan, the Long Term Master Transport Plan, and also aligns to the priorities identified by Infrastructure NSW in the State Infrastructure Strategy.

TfNSW should commit to developing Regional infrastructure models across NSW, and provide greater detail on how these regional plans will be developed and align to other regional transport, planning and infrastructure strategies.

Road funding The system of road user charging and funding is a barrier to investing in infrastructure and permitting access to restricted access vehicles. A commitment to streamline and reform road funding is supported in principle, however there needs to be additional information provided on how the NSW Government intends to do this. Depending on the model chosen, reforms will have varying impacts on the freight industry and these must be considered.

Illawarra Business Chamber 8

Mechanisms to improve access for HPVs and Restricted Access Vehicles (RAVs) are supported and need to be included in the final Strategy. The road network will not improve its efficiency without improving the access of these vehicles across NSW.

Greater detail is needed on how the NSW Government intends to reform road funding in order to provide some certainty for businesses.

SMART Infrastructure Facility Much of the freight strategy is focused on making better use of the existing system. The Strategy identifies that work will be undertaken with users of the network, the Commonwealth and other State Governments, Transport for NSW will develop macro and micro level indicators of performance for use in measuring and reporting on the efficiency and effectiveness of the freight network.

The SMART Infrastructure Facility, located at the would be well placed to assist the NSW Government in undertaking some of the systems analysis work that is needed to identify where gains can be made within the freight network and the impact of decisions on other areas of the network – in particular the role of the Cargo Movement Coordinator could be assisted by this facility. SMART has already provided transport modeling services to the Port Corporation and stakeholders to assist in optimisation of the freight network.

TfNSW should consider using SMART Infrastructure Facility to undertake any systems analysis to optimise efficient use of freight network.

Illawarra Business Chamber 9

Conclusion The Illawarra Business Chamber appreciates the opportunity to comment on the Draft Port and Freight Strategy. Effective planning and delivery is essential if NSW is to meet the growing freight task challenge over the next 20 years. Failure to act will result in higher costs and decreasing competitiveness for businesses across the State.

For the Illawarra the priority issue is for the NSW Government to deliver on its commitment to separate rail and passenger freight. Commitment to obtain funding from the Federal Government and private sector to deliver this project will improve efficient freight access to Port Kembla, free up latent rail demand for Port Botany, and help to unlock much needed passenger time saving improvements on the Illawarra Line.

The Port Kembla Growth plan and the proposed Regional Infrastructure Model would provide greater certainty about infrastructure planning, which will help guide and unlock private sector investment. The IBC supports the objectives and actions in the Strategy to enhance the efficiency of current infrastructure, increasing capacity across the network and making the network sustainable.

Contact For further information please contact:

Mike Halloran

Interim CEO, Illawarra Business Chamber p. 4229 4722 e: [email protected]

Illawarra Business Chamber 10

Presented by:

Illawarra Business Chamber Level 1, 87-89 Market St Wollongong NSW 2500 p: 4229 4722 | f: 4229 6392 | e: [email protected] illawarrabusiness.com.au | facebook.com/Illawarra.Business | twitter.com/IBC_Illawarra