Budget response No.3: rail freight investment welcomed – and deserved

The Australasian Railway Association (ARA) has welcomed the Federal Government’s commitment to an additional $1 billion in rail infrastructure funding announced in the 2010-11 Budget.

“I commend the Government for its strong commitment to rail. This announcement will ensure rail plays a central role in Australia achieving the productivity gains necessary to meet the needs of a growing domestic economy and maintaining international competitiveness,” said Bryan Nye, CEO of the ARA.

This investment in rail will enhance energy security through reducing Australia’s reliance on imported liquid fuels, reduce greenhouse gas emissions, road congestion and the cost of road accidents associated with the movement of freight.

The package will improve transit times and reliability on the North-South and East-West freight corridors, establish an intermodal freight facility in the South-West of Sydney and the $5.6 billion ‘State Infrastructure Fund’ will ensure the continuing investment in nationally significant infrastructure.

Mr Nye said: “These measures should be viewed as another positive step in re-shaping our freight supply chains. However, investment alone will not be the panacea for addressing the challenges facing the freight sector.”

The ARA advocates sector-wide reform to ensure that the right mode of transport is utilised for the right task. Reform of economic regulations governing road pricing and rail access charges should be a central policy imperative.

The Federal Government’s Henry Tax Review has been instrumental in putting forward solutions which will result in equitable road pricing and rail access charging regimes.

Mass-distance-location road pricing for heavy vehicles will ensure that these vehicles pay their fair share for the damage they cause to our roads. Mass-distance-location road pricing will remove their effective subsidisation. The ARA strongly urges the Federal Government to prioritise the implementation of the Henry Tax Review’s road pricing recommendations.

“The implementation of the Henry Tax review recommendations for road pricing, combined with the commitment to freight infrastructure funding will ensure an efficient, sustainable freight network equipped to support Australia’s future growth,” concluded Mr Nye.