AusRAIL, Market Sectors

Industry welcomes Vic rail buyback plan

<p>The Victorian freight network buy back would clear the way for investment in the deteriorating infrastructure, the logistics and farming lobby said yesterday (Wednesday, November 1).</p> <p>The chairman of the Victorian Freight Logistics Council’s Infrastructure Working Group, Phil Lovel, said the decision would break an impasse in negotiations, which has slowed investment in the state’s rail network. </p> <p>&#8220We have been requesting the government take leadership on this matter for more than a year and we now hope there can be a 10-year investment plan worked through with the rail operators and most importantly, the grain and intermodal customers,&#8221 Mr Lovel said.</p> <p>While the Victorian Farmers Federation (VFF) have applauded the $134m deal for the State Government to buy the lease of the regional track network from Pacific National, they said it must be accompanied by an equally strong commitment to maintenance and improved network condition, while ensuring access pricing remained competitive.</p> <p>Since Rail America subsidiary Freight Australia &#8211 and subsequently Pacific National &#8211 took over a 45-year lease on the network in 1999, the VFF had noticed a &#8220continued decline in rail infrastructure standards&#8221, it said. </p> <p>VFF president Simon Ramsay said the VFF has been a critic of the consequences of the long-term lease from the beginning.</p> <p>&#8220It has long been a policy of the VFF’s that the country rail network should go back into government hands and it’s good to see that the common sense policy decision to buy back the lease has been made by the two major political parties,&#8221 Mr Ramsay said.</p> <p>Infrastructure spending on the network has been a political hot potato since the 1999. sale. </p> <p>The track is in poor condition and initial reports estimate the network will need a $200m injection to bring it up to standard.</p> <p>The Essential Services Commission estimates $28.4m a year is required for regular maintenance and a further $44.5m is required for major periodical maintenance.</p> <p>Victorian Logistics and Freight Council chairman John Begley expects to see improved above rail competition as a result of the decision. </p> <p>&#8220Above rail operators will overcome the perception that a monopoly player will undermine competition,&#8221 he said.</p> <p>&#8220This has been a fear expressed by rail operators which can be dispelled. With investment, this could be the start of increased usage of the network.&#8221</p> <br />