The state government has committed $29 million to Western Australia's ageing grain freight network and has called on farmers and bulk handlers to use rail lines rather than roads to transport grain.
The state government has committed $29 million to Western Australia's ageing grain freight network and has called on farmers and bulk handlers to use rail lines rather than roads to transport grain.
Transport Minister Simon O'Brien today announced a package of measures designed to bring greater certainty to the state's grain freight network.
It follows the release of a report by the Strategic Grain Network Committee (SGNC), chaired by Fred Affleck and included representatives from WestNet Rail and CBY Group, that looked into the future viability of the narrow gauge rail network.
Today Mr O'Brien said state cabinet had committed to fund 50 per cent of the $43.5 million required to complete the re-sleepering of the Avon to Albany rail line.
"Discussions will be sought with the Federal Government to seek similar funding," he said.
"In addition, $500,000 will be spent to start project development and pre-construction activities on the proposed Chester Pass Road upgrade, a key north-south regional road route linking Albany and the Southern Wheatbelt."
A further $6.9 million will be budgeted for the Transition Assistance Package, which aims to keep the current harvest on uneconomic rail lines.
The package stems from the SGNC indentifying that in the deregulated environment, farmers and grain handlers, in areas where rail could not compete on a cost-competitive basis with road transport, would always opt for the cheapest mode of transport.
"Western Australians face the very real threat that, unless immediate action is taken, then there will be many tens of thousands of additional heavy vehicle movements on roads between the Wheatbelt and the Kwinana and Albany grain terminals," Mr O'Brien said.
"The State Government has seen the need to keep grain on rail on a number of uneconomic lines for a period of time until infrastructure investment in roads and upgraded grain receiving points on the rail network takes place."
CBH Group logistics strategy manager Tim Collins told WA Business News that today's government announcement has been a long time coming.
"We're extremely pleased," he said.
"The result today is the beginning of the government's take up of the recommendations of the report.
"Today [the announcement] relates to a few of the findings, there's still a long way to go, but today is a step in the right direction and we think it's a positive endorsement of the grain industry and the network generally."
Today's news follows a standoff between the state government and rail operator WestNet Rail early last year, where the latter was seeking $45 million to re-sleeper the Avon to Albany rail line.
WestNet had suspended operations on four regional rail lines after the government did not meet its deadline to come up with the funding.
However by July, WestNet and the government came to an agreement to establish the SGNC to investigate the freight network.
The agreement follows lobbying by the state's farm groups and the WA Local Government Authority that spruiked the benefits of transporting grain on either road or rail.
The announcement is below:
Transport Minister Simon O'Brien today announced a package of measures designed to bring greater security and certainty to the State's grain freight network.
This followed the public release of a report by the Minister's Strategic Grain Network Committee (SGNC) into the narrow gauge rail network's future viability.
Mr O'Brien said the Liberal and National parties had, when forming Government, determined to find a long term and sustainable solution to the network's problems.
"This significant financial package will increase the volume and efficiency of this strategically important asset and provide certainty to grain growers and the freight logistics sector," he said.
"State Cabinet today committed to fund a 50 per cent share of the $43.5million required to complete the re-sleepering of the Avon to Albany rail line.
"Discussions will be sought with the Federal Government to seek similar funding.
"In addition, $500,000 will be spent to start project development and pre-construction activities on the proposed Chester Pass Road upgrade, a key north-south regional road route linking Albany and the Southern Wheatbelt.
"This package stands in stark contrast to the approach of the former Labor government, which failed to address this issue during their eight years in government."
The Minister said the SGNC review considered all of the historical and contemporary issues facing Western Australia's grain freight network.
The independent committee was chaired by Professor Fred Affleck of the Freight and Logistics Council, and included representatives from CBH, Australian Railroad Group, WestNet Rail, peak grower groups, and personnel from Federal, State and local governments, including WALGA.
"The SGNC identified that the Commonwealth's decision to deregulate the grain market has profoundly affected the way grain is both handled and shipped to market in WA," Mr O'Brien said.
"In the deregulated environment, famers and grain handlers located in areas where rail cannot compete on a cost-competitive basis with road transport will always opt for the cheapest mode of transport.
"Western Australians face the very real threat that, unless immediate action is taken, then there will be many tens of thousands of additional heavy vehicle movements on roads between the Wheatbelt and the Kwinana and Albany grain terminals."
The Minister said to address this immediate threat, State Cabinet had also approved a $6.9million Transition Assistance Package for the current harvest to keep grain running on what, at present, are uneconomic lines.
"The State Government has seen the need to keep grain on rail on a number of uneconomic lines for a period of time until infrastructure investment in roads and upgraded grain receiving points on the rail network takes place," he said.
Mr O'Brien said the State Government recognised that some non-economic rail lines would ultimately need to be put into care and maintenance if the industry opted not to use rail as the preferred mode of grain transport.
"While the Government is committed to keeping grail on rail, the real onus is on farmers and bulk handlers, who currently opt to use road transport, to put their money where their mouth is and put their grain back on rail," he said.