Parliamentary Inquiry Into Food Pricing and Food Security in Remote Indigenous Communities
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10 July 2020 The Committee Secretary House of Representatives Standing Committee on Indigenous Affairs PO Box 6021 Parliament House Canberra ACT 2600 Via email: [email protected] Submission - Parliamentary Inquiry into Food pricing and Food security in remote Indigenous Communities Table of Contents 1. Introduction .................................................................................................................................... 3 2. Sea Swift Background & Ownership ............................................................................................... 4 3. Our Vision, Values and People ........................................................................................................ 4 4. The Sea Swift Transport Network ................................................................................................... 6 4.1 Overview ....................................................................................................................................... 6 4.2 Description of the Sea Swift Transport Network .......................................................................... 7 4.3 Marine Transport is a Carbon Friendly Mode of Transport. ....................................................... 10 5. Transport System Issues, Constraints and Cost Drivers ................................................................ 10 6. Challenges and Customer Expectations ........................................................................................ 11 7. Community Support & Engagement ............................................................................................. 12 8. Regulatory Regime ........................................................................................................................ 13 9. Freight Rates ................................................................................................................................. 15 9.1 Network Pricing ........................................................................................................................... 15 9.2 Australian Competition and Consumer Commission (ACCC) Undertakings ............................... 15 9.3 Fuel Surcharge............................................................................................................................. 16 9.4 Perceived Freight Cost Anomalies .............................................................................................. 16 9.5 Shopping Basket Comparison ..................................................................................................... 17 9.6 Freight Subsidy ............................................................................................................................ 18 Annexure A ............................................................................................................................................ 20 pg. 2 1. INTRODUCTION I would like to thank the Enquiry for the opportunity to respond on behalf of Sea Swift – the major sea freight provider to the remote coastal and island regions of Queensland and Northern Territory. I also acknowledge the traditional owners of the regions in which we operate. In this submission, Sea Swift will respond to the Committee Terms of Reference as follows: Terms of Reference Sea Swift Submission 1. The environment in which Remote This submission describes the physical and Community retailers operate. commercial challenges of operating a freight service to remote coastal communities. 2. The licensing and regulation requirements This submission describes the regulatory and and administration of Remote Community governance framework that governs the stores. movement of vessels and freight in the regions we operate within. 3. The governance arrangements for Remote This submission describes the regulatory and Community stores. governance framework that governs the movement of vessels and freight in the regions we operate within. 4. Comparative pricing in other non-Indigenous This submission includes a comparative remote communities and regional centres shopping basket of product, detailing the direct freight cost that applies to each item in the basket. We also include a limited comparison of retail prices in Cape York and Torres Strait islands 5. Barriers facing residents in Remote This submission describes the physical and Communities from having reliable access to commercial challenges of operating a freight affordable fresh and healthy food, groceries service to remote coastal communities. and other essential supplies. 6. The availability and demand for locally Sea Swift are not in a position to respond on produced food in Remote Communities. this topic. 7. The role of Australia's food and grocery manufacturers and suppliers in ensuring adequate supply to Remote Communities, including: a. identifying pathways towards greater cooperation in the sector to improve supply. b. the volume of production needed for Remote Communities. c. challenges represented by the wet season in This submission describes the challenges Northern Australia as well as locational faced within our part of the supply chain to disadvantages and transport infrastructure remote communities. issues that might be relevant. d. geographic distance from major centres. pg. 3 8. The effectiveness of federal, state and territory consumer protection laws and regulators in: a. supporting affordable food prices in Remote This submission describes the current Communities particularly for essential fresh voluntary undertaking with ACCC to ensure and healthy foods. pricing for freight remains competitive. b. addressing instances of price gouging in Remote Communities; and c. providing oversight and avenues for redress. 9. Any other relevant factors. This submission includes a detailed description of the business model for service delivery, including the level of resources, capital and risk involved in operating a 365 day per year service to the most remote communities in Australia. 2. SEA SWIFT BACKGROUND & OWNERSHIP Sea Swift is a privately owned company with headquarters in Cairns and has provided shipping services to the Torres Strait and Northern Peninsula region for over 30 years, and in the Northern Territory via our acquired predecessors for the same period. Sea Swift operates a fleet of cargo vessels and landing barges in order to provide for the sea freight needs of Cape York, Torres Strait islands, Gulf of Carpentaria and Northern Territory coastal communities. Sea Swift is owned by the QIC Global Infrastructure Fund (QGIF). QIC is one of Australia’s largest institutional investment managers with over $80 billion in assets under management comprising of domestic and global superannuation, pension, insurance and sovereign wealth investor funds. There is a broad misconception that Sea Swift is a QLD Government owned and managed business. For clarity, our shareholder QGIF is not controlled by the Queensland Government, and we have no shareholding Minister. 3. OUR VISION, VALUES AND PEOPLE “Our vision is to be the leading full-service logistics solution for Northern Australia, supporting industry and economic development of its coastal and island communities and people” Sea Swift has a very clear understanding and appreciation of the role we play in the development of the communities we service from both a micro and macro level. Our footprint (Northern Australia) is largely untapped and we will do all we can to provide opportunity for the communities, the region and the nation to turn this opportunity into quality results. Sea Swift supplies the crucial ‘last-mile access’ to communities and people that are hundreds of kilometres from main supply hubs, with transport limitations for part/most/all of the year. The essential service nature of our business is core to our existence and by extension we strive to be good corporate citizens through the reliable and consistent provision of that service. pg. 4 Our Values Our shared values are: • Teamwork • Customer Focus • Commitment • Accountability The Sea Swift team are passionate about growing Northern Australia and improving the standard of living in the region. We connect remote communities and foster economic development by delivering a safe, reliable service, with pride. We live and work in a unique part of the world and our aim is to promote this and make living in Northern Australia easier by connecting our diverse cultures. Our People Sea Swift is committed to building, developing, and growing a workforce of high-quality employees but more importantly people from the local area wherever possible. Sea Swift employs 442 staff in our 10 locations and on our 50+ vessels strategically located throughout Northern Australia. We support local communities wherever possible by hiring our workforce locally. Sea Swift has four main streams of employment – Marine (on the vessels), Operations (in the depots), Engineering (tradespeople) and Administration. There are very few other employers (not including Government) that have the breadth of employment across remote and regional Northern Australia that we do. Sea Swift is proactive in employing Aboriginal or Torres Strait Islanders when and wherever possible throughout our organisation and developing each employees’ skills and abilities. We do this by deliberately targeting indigenous persons for employment, which is reflected in Indigenous employees comprising up to 15% of our entire Northern Australia workforce. In the Torres Strait region 67% of our depot staff,