By Rob McKay
 This should be done “at almost any cost rather than allowing ARTC to maximise profit””, Smith said.
“”Any diminished profitability of track access is trivial compared with benefits to Australia of ensuring that rail infrastructure is used as efficiently as it can be.””
Speaking at a Committee for Economic Development of Australia (CEDA) event in Melbourne entitled Rail Reform: Getting freight back on track, Smith said that the ARTC’s structure was “”a corporation with profit accountability””.
He said the February 2008 decision to increase track access charges on the east-west corridor by 10 per cent while decreasing track access on the north-south corridor by 10 per cent was retrograde.
This had led to an increase in freight rates to Perth but no discernable savings on the north-south route and the only resultant modal shift had been from east-west rail to sea transport.
Given the capital-intensive nature of rail, such “”goal-post shifting”” could only harm operators, Smith said.
He also warned that the number of operators was reaching saturation point, which would mitigate against investment in modern rolling stock, locomotives and technology, along with critical mass and efficiency.
“”More trains, more operators but with the same amount of volume of freight means smaller and less-efficient trains,”” Smith said.
The likelihood was of consolidation in the industry, without gains for consumers.
Smith said that without the Government will to improve the north-south corridor, rail’s percentage of the freight market would inevitably decline.
“”If we are to swing volumes from road to rail on the eastern seaboard, that will be driven by a more competitive pricing structure,”” Smith said.
“”To reduce prices we need a network which facilitates optimum trains and that’s where the Government’s investments can allow us to do that.
QR refused to comment on the issue and Pacific National had not returned Lloyd’s List DCN’s calls by the time of publication.
Meanwhile, National Transport Commission chief executive Nick Dimopoulos criticised the lack of long-term national planning.
“”Australia is guilty of throwing money on short-term fixes, knowing that once the money runs out, the problems are likely to bounce back in perhaps, five or 10 years time,”” Dimopoulos said.
Australasian Railway Association chief executive Bryan Nye pointed out that if eastern Australia had a normal grain harvest, farmers would struggle to get export produce to port, given the state of regional rail infrastructure.
Nye highlighted the vulnerable nature of rail assets, saying that the average age of the grain fleet was greater “”than anyone in this room””.
The average age of Australian locomotives generally was 34.5 years, while in the US the average age was eight years.
Source: Lloyds List Daily Commercial News – www.lloydslistdcn.com.au
 
 
 
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