Victorian treasurer Tim Pallas says the privatisation of the Port of Melbourne will help pay for the Melbourne Metro and Level Crossing Removal projects.
Pallas introduced the Delivering Victorian Infrastructure (Port of Melbourne Lease Transaction) Bill 2015 to Parliament on May 26.
The following day, he announced proceeds from the lease will be paid, up front, into the Victorian Transport Fund to contribute to the removal of the state’s 50 “worst” level crossings, and the building of the Melbourne Metro, the West Gate Distributor and “other important transport initiatives”.
The funds raised will also be “critical” to help preserve the state’s triple-A credit rating, the treasurer added.
“We’re constantly reminded of the escalating cost of congestion to the Victorian economy,” he said.
“The returns from the lease transaction offer an opportunity to deliver in less than a decade the productivity boost that level crossings have held back for so long.”
The 50-year lease will be for the port’s commercial operations only, the treasurer said, with the Victorian and Commonwealth governments retaining responsibility for port safety, security and the environment.
Station Pier, walkways and bike paths will remain in public hands.
“The lease will reinforce Victoria’s position as Australia’s freight and logistics capital – good news for producers and manufacturers who export all over the world, and consumers who want affordable products,” Premier Daniel Andrews said.
Joint financial advisers Morgan Stanley and Flagstaff will call for expressions of interest on behalf of the state, once the legislation has passed the Victorian parliament.
The privatisation of the Port of Melbourne follows a trend around Australia in recent months and years.
Port Adelaide has been privately-owned since 2001, but the Port of Brisbane became the first major Australian container port to privatise since then, when it was sold in 2010.
This was followed by the sale of Port Botany and Port Kembla in 2013.
The formalisation of the planned sale of the Port of Melbourne comes in the same month the Western Australian government announced its intentions to sell off that state’s biggest container port, Fremantle.
Once Melbourne and Fremantle are sold, each of Australia’s top five container ports (by traffic) will be privately-owned.
This is an edited version of a story which originally appeared in Rail Express sister publication, Lloyd’s List Australia