South Australia's Freight Transport

South Australia’s Freight Transport Infrastructure Principles and Project Priorities April 2005 Executive Summary South Australia’s ability to achieve its maximum growth potential is linked to the timely development of efficient and cost-effective transport infrastructure. The South Australian Freight Council has identified nine projects which, in its view, are vital to ensure the State continues to grow free of transport bottlenecks or inadequate infrastructure that add to costs and reduce the State’s competitiveness. The transport initiatives identified by SAFC, with an overall cost in the order of $2.4 billion, comprise the centrepiece of the Council’s submission to the State Government which is currently developing a series of plans that affect the freight and logistics sector. The Council also believes the Australian Government has “short-changed” SA relative to other States with the lowest per capita payments for new road and rail developments. This situation must change with further Auslink funding of $127 million (ie. a total of $636m) required to put SA on an equitable footing with the rest of the country. With a population that is dispersed over an area greater than several other States, SAFC believes the case for increased funding is compelling. In the absence of financial support for the projects identified, and in light of the fact that efficient transport infrastructure is integral to interstate and overseas trade, SAFC believes the State Government’s Strategic Plan goal of almost trebling SA’s exports by 2013 will not be realised. Improving the flow of commercial and private transport will also deliver significant environmental gains for the community with a reduction in greenhouse gas emissions high amongst them. In its submission to the State Government, SAFC’s members, who represent over 10,000 businesses, have encouraged the Government to consider a number of projects as “high priority” initiatives. These include: • The deepening of channels and berths at Outer Harbor ($169 million including associated berths and transport connections but not including Port River Expressway costs); • Construction of the Port River Expressway including closed bridges ($220 million); • Addressing a “desperate” backlog of road infrastructure maintenance ($160 million); • Extending the Sturt Highway to benefit the near north and beyond ($300 million); • Development of a North-South corridor through Adelaide ($1.3 billion); and • Construction of passing lanes on the Riddoch Highway in the south-east ($10 million). SAFC’s submission is underpinned by a Statement of Principles that highlights the economic, social, and environmental benefits of an effective and comprehensive freight transport infrastructure. Rail freight photograph on front cover courtesy of GRMS Media 1 Introduction Safe and efficient freight transport is an absolute requirement of today’s world. It underpins every aspect of the South Australian economy. It must also be provided in a way which is economically, socially and environmentally sustainable. The provision and maintenance of an effective and comprehensive Freight Transport infrastructure is a core responsibility of government. Achieving a regime that strikes the best balance of air, sea, rail and road transport throughout the State, interstate and overseas is a fundamental pre-requisite for the economic and social viability of South Australia. The South Australian Freight Council (SAFC) advises the State and Federal governments on all aspects of planning for and meeting South Australia’s freight related infrastructure needs. It is focussed on identifying key freight logistics issues and developing solutions for implementation by Government and within industry. SAFC’s members are drawn from all industry sectors along the supply chain, ranging from buyers and users of freight to freight service providers and Government. SAFC has released this position paper – including prioritising the State’s top nine projects – to clearly and objectively identify the infrastructure requirements of the State and support the emerging business and community demand for freight movement over the next 20 years. SAFC has prepared this document to assist governments and other stakeholders by communicating its views on: • The core principles that must underpin the State’s infrastructure and its management; • The priorities in infrastructure planning and implementation; and • A qualitative triple bottom line assessment of the freight infrastructure priorities. Fundamental Objective The fundamental objective in the provision of freight infrastructure must be to ensure that South Australia has an efficient, effective, internationally competitive, multi-modal, state-wide freight system to meet the economy’s ongoing and projected freight demands. 2 Government Planning Background The South Australian Government is due to release an Infrastructure Plan and has also been developing a State Transport Plan and State Freight Strategy. SAFC has provided comments during the development of both the Transport Plan and the Freight Strategy and understands that these plans will now be embodied in the State Government’s broader Planning Strategy. The SAFC remains interested to see the extent to which its comments have been taken into account. At a national level, the Australian Government has released Auslink as its platform for a planned approach to nationally significant infrastructure development. While supporting the concept of Auslink, as an otherwise logical and strategic approach, SAFC is highly critical of the gross inequities of the funding allocation under Auslink for South Australia. SAFC played a key role in the pre-election campaign that succeeded in increasing the State’s initial allocation by $118m (a 37% increase), but this still falls well short of a “fair share”, and a further $127m is required to put South Australia on an equitable footing with the other States. Auslink Funding Road and Rail Transport Infrastructure Allocations ($ Per Capita) Average $418.20 ACT $146.06 NT $623.07 TAS $422.02 SA $335.54 SA WA $364.94 QLD $492.08 VIC $384.42 NSW $441.54 $0.00 $100.00 $200.00 $300.00 $400.00 $500.00 $600.00 $700.00 SA Population Share 7.6% SA Share of Auslink Funding SA National Roads 11% 6.9% SA Regional Roads 15% The inequitable allocation of Australian Government funding is confirmed by South Australia’s per capita allocation for road and rail infrastructure lagging behind grants to the other States – even after including the $118m extra funds committed during the 2004 Federal Election. 3 Core Principles and Policy Issues; Freight Transport Underpins the Community: Freight infrastructure and the industry exist to serve the interests and daily needs of business and the community. • Freight transport is a derived demand – it arises from the original demand from businesses and the community for specific products and their transport and handling. People demand the product, the freight transport sector moves it to them, and it also removes the by-products and waste of the community and manufacturing. Core Government Responsibility and Community Acceptance: The State and Federal governments have a core responsibility to provide and properly maintain transport infrastructure to meet the needs of the community and the commercial sector today and for future generations. • Proper and full funding of transport infrastructure, for new projects and maintenance, must be a first order priority of governments; including, where appropriate, through private public partnerships (PPP) or other funding mechanisms. • Governments and Businesses must raise the community’s awareness and acceptance of the fact that transport infrastructure is necessary to support the community’s needs. In turn, the community must acknowledge, rather than ignore, the need to allocate substantial government funding for infrastructure as a high priority. Facilitate Multi-modal Balance: The infrastructure assets, policies and regimes implemented by Governments must facilitate genuine and effective modal choice and a sound balance in the use of the various modes – air, sea, rail and road. The SAFC has no underlying preference for any given mode and it therefore supports, as a fundamental cornerstone, the utilisation of the most appropriate mode(s) for any given freight task and region. Governments should not artificially manipulate modal choice, through subsidies or other means, for essentially political purposes because the resultant outcomes can only be counter-productive for the economy and the environment. Where Government does exercise its responsibilities in influencing modal choice, it should only do so on a basis that is genuinely commercially sustainable in the medium-to-long term, in so far as freight rates and service are concerned, to meet projected demand. Long-term Confidence and Certainty: Freight infrastructure planning and development must be managed in a manner which provides the community and the business sector with the necessary certainty and confidence to facilitate the sound commercial decisions and long-term investments required for the State to be nationally and internationally competitive. • Governments and industry partners must deliver the infrastructure as planned, and on-time, and the network must perform reliably, to the desired standard, on a consistent and sustainable basis. • Freight corridors, infrastructure and precincts must not subsequently be encroached upon or be denigrated or downgraded by urban sprawl and inappropriate adjacent

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