Reliability and safety upgrades underway on Hunter Valley Line

Just as work on upgrades to the North East Line have continued in Victoria, despite the COVID-19 crisis, so too will works on the Hunter Valley Line.

The works will focus on ensuring reliability on the Hunter network, which carries passenger and freight services, said the Australian Rail Track Corporation (ARTC).

“The freight and transport industry has been identified as an essential service by the State and Federal Government – this  is a responsibility the Australian Rail Track Corporation takes very seriously, and we are working hard to ensure we balance the challenge of ensuring the safety and reliability of a critical transport network, alongside our obligations to meet and respond to the current public health challenge,” said the ARTC’s group executive Hunter Valley Wayne Johnson.

Half the services on the line are passenger services from Newcastle to the towns of Dungog and Scone, while the rest is comprised of freight services carrying coal, grain, and other export products. Regional and interstate goods services also use the Hunter rail network.

“It is critical that we continue to meet the need of delivering goods, products and people – but we are acutely aware of balancing the demands of running an extensive rail network, with the health and welfare of our people and the communities in which we operate,” said Johnson.

Although a planned maintenance shutdown was scheduled for the Hunter Valley network this week for major upgrades, the ARTC will instead only deliver essential works during the shutdown to maintain the rail network’s safety and reliability. The ARTC has implemented a number of measures to prevent the spread of coronavirus (COVID-19), and ensure that workers are safe.

“As coronavirus (COVID-19) continues to spread and disrupt people’s daily lives, we  have implemented a range of preventative measures to ensure the safety of our team and the community, while endeavouring to ensure reliable network operations can be sustained for critical freight movements in coming weeks,” said Johnson.

North East Rail Line upgrade continuing

Work is continuing on the upgrade of the North East Rail Line, the ARTC confirmed on Friday, March 27.

While shutdowns of non-essential services to limit the spread of coronavirus (COVID-19) have affected other industries, the construction of rail infrastructure has been deemed an essential service, said  Australian Rail Track Corporation (ARTC) general manager projects Victoria, Ed Walker.

“The freight and transport industry is an essential service– and the North East rail line is a vital transport corridor for interstate freight trains, passenger trains, steel for construction and manufacturing and for regional goods like grain.”

The ARTC has implemented measures to ensure the safety of staff and contractors undertaking the vital upgrades. Workers are practicing social distancing, increasing hygiene and health measures, delivering work in smaller groups, and avoiding non-essential travel.

“We continue to follow advice from Government and monitor and assess the situation daily. The current environment is an uncertain and challenging one for everyone and we certainly recognise the responsibilities we have to the community as we deliver this vital project work and to ensure the safe running of essential freight and passenger train services,” said Walker.

Two weeks ago, sections of the track were shutdown and handed over to contractor John Holland Rail, so that a series of projects could be completed. A similar shutdown will occur from Saturday, April 4.

“Further works will take place next weekend, from Saturday 4 April at 6pm, with bridge and track renewal work taking place at the Old Barnawartha Road, West Wodonga and High Street, Barnawartha level crossings,” said Walker.

The announcement from the ARTC follows assurances given to Rail Express last week that a number of rail infrastructure projects are continuing, including the Level Crossing Removal Project, Metronet works, and Cross River Rail construction.

Joint communiqué affirms indispensability of rail freight

Australia’s largest rail freight operators and infrastructure managers have welcomed statements by Australian governments ensuring that rail freight services continue despite state border closures and shutdowns of non-essential services.

Chair of the the Freight on Rail Group, Dean Dalla Valle highlighted that rail freight services are critical for the supply of domestic and imported goods such as food, medical supplies, cleaning products, and fuel.

“Paddock to port, pit to port, or manufacturing plant to port – essential rail freight services stretch across state borders, servicing finely-tuned supply chains across our continent,” he said.

In collaboration with truck drivers working the ‘last mile’ of supply chains, rail services have hauled significant amounts of items in urgent need during the coronavirus (COVID-19) pandemic.

“A single-stacked 1,800-metre interstate goods train can haul 260 shipping containers, thereby helping to free-up hundreds of truck drivers each week to focus on delivering goods and products the remaining ‘last mile’ from warehouses to stores where consumers need shelves restocked,” said Dalla Valle.

“To put this in perspective, a single shipping container can hold approximately 25,000 toilet paper rolls, 55,000 food cans or 1,500 cases of beer.”

The move follows a meeting of the Transport and Infrastructure Council, made up of state, territory and federal infrastructure and transport ministers, on Wednesday, March 25, which affirmed that freight movements are an essential service, and will continue to operate despite restrictions on activity around the country.

“We, Australia’s Transport and Infrastructure Ministers, wanted to reassure Australians that supporting freight movements and supply of goods to individuals, businesses and service providers is a high priority for all governments,” wrote the ministers in a joint communique.

While Queensland was the latest state to close its borders, following Western Australia, South Australia, the Northern Territory, and Tasmania, the ministers confirmed that these would not inhibit the efficient movement of freight across Australia.

“All jurisdictions where restrictions are in place have provided exemptions to these measures to ensure Australia’s supply chains are maintained,” wrote the ministers.

“We want to thank all those Australians involved in the freight industry who are serving Australia so diligently despite the challenges we face.”

To ensure that rail freight operators do not become susceptible to COVID-19, additional measures have been put in place, said Dalla Valle.

“In recent weeks, rail freight operators have implemented strict hygiene protocols at depots, terminals and maintenance facilities, including social distancing, to protect the health of essential staff,” he said.

“Rail freight has the added benefit of operating within secure railway corridors and facilities prohibited to members of the general public.”

The Freight on Rail Group is made up of nine rail freight businesses, Pacific National, the Australian Rail Track Corporation (ARTC), Aurizon, Qube, One Rail Australia, SCT Logistics, Arc Infrastructure, WatCo Australia, and Southern Shorthaul Railroad.

Major projects

Infrastructure works an “essential service”

Major infrastructure projects are ensuring the safety of their staff while continuing to progress upgrades and significant works while COVID-19 mitigation measures close down other sectors.

The Cross River Rail Delivery Authority (CRRDA) is adhering government guidelines and advice by implementing new safety measures at its sites.

Segregated work zones, restricted access for non-essential workers, and a ban on non-essential access is enabling the 1,500 people working on the Cross River Rail project to continue.

Major works contractors are strengthening their own health and safety procedures while CRRDA office staff are working from home, or only attending the office when essential tasks cannot be completed remotely.

In Perth, construction on the Metronet project is continuing, business as usual, with no restrictions on works being conducted.

In Victoria, the Corey Hannett, director-general, Major Transport Infrastructure Authority, which delivers projects including the Level Crossing Removal Program, the Metro Tunnel project, and the Regional Rail Revival program, among others, told Rail Express that the Authority is ensuring that construction continues with no impact to projects.

“The construction sector is currently considered an essential service and we are working closely with industry partners, unions, employers and workers to protect both their safety and jobs,” said Hannett.

A safety team of 70 is ensuring workers and sites comply with social distancing requirements.

“Project sites have strict rules in place around social distancing, increased industrial cleaning, provisions of personal protective equipment,” said Hannett.

Additionally, an alliance of construction unions and employers groups have united to ensure that safe practices are adopted to keep construction sites open.

In New Zealand, works have been temporarily suspended on the City Rail Link project, however the delivery team is ensuring that when lockdown measures are lifted, teams can get back to work immediately.

“We are doing everything we can to ensure that we are well placed to come out of the blocks very fast when the restart call is given,” said CRL chief executive Sean Sweeny.

Freight continues as borders shut

With states closing their borders to interstate travel, those needing to continue to travel, including rail freight operators, into Western Australia and the Northern Territory are being asked to complete an arrival form.

The respective forms for WA and the NT can be found here and here.

From today, March 25, Queensland has also closed its borders. This has affected passenger rail services from NSW, which are now terminating at Casino, rather than continuing to Brisbane.

Due to the extensive connections between Queensland and New South Wales along the border at Tweed Heads/Coolangatta, local movements for shopping, work, medical appointments and travel home are not affected.

In addition, to limit the spread of the virus train and tram services in South East Queensland are only accepting pre-paid tickets to avoid the handling of cash.

While these measures have been put in place to ensure community safety, the Australian Logistics Council (ALC) has continued to press for freight services to be allowed to continue unaffected, due to their critical nature delivering food and supplies around Australia.

CEO of the ALC, Kirk Coningham, has said that he is happy with the measures put in place so far.

“It is pleasing that states and territories have all recognised the essential nature of the freight task by exempting freight and logistics from border closure arrangements,” he said.

“We now need states and territories to ensure that exemption is given practical effect, and make certain freight vehicles are not delayed for lengthy periods at border check points.”

Freight operators have been putting in place extra social distancing measures and cleaning measures to ensure that freight vehicle operators cannot spread COVID-19. With this in mind, delays at borders should be minimised, said Coningham.

“Those operating freight vehicles have rigorous restrictions around the number of hours they can work. Significant delays at border check points could end up producing delays of 24-hours or more in the movement of freight,” he said.

Qube

Rail stocks see rebound

While stock markets around the globe have seen a series of wild weeks with swings some of the largest they have been for a century, one area of safety is rail freight.

ASX-traded Aurizon (AZJ) received a significant bump in trading, up 3.85 per cent over the past five days of trading. The stock was reportedly selected by Swiss investment bank UBS as one of the best defensive stock bets in Australian markets.

“We like [gas pipeline owner] APA and AZJ as they are two income names with highly defensive dividends given their ‘take-or-pay’ structure,” a UBS analyst told financial markets site The Motley Fool.

Aurizon’s share price has been lifted by stock buybacks by the company, as well as targeted buying by insiders, including chairman Timothy Poole and non-executive director Michael Fraser, how both bought tens of thousands of dollars worth of Aurizon stock, according to finance watcher Simply Wall St.

Other rail stocks that have been weathering the financial storm during COVID-19 is logistics provider Qube. The company, listed on the Australian Stock Exchange (ASX) as QUB, grew by 3.76 per cent over the past five days.

Although rallies elsewhere in markets have been driven by speculation on the size of the US stimulus and it passing through the legislature there, the strong performance of Aurizon and Qube could be linked to their role in continuing to move freight despite shutdowns elsewhere in the economy,

Room for growth in trying times

While the COVID-19 pandemic is causing an undeniable impact upon the Australian economy, the rail industry is continuing to play its vital part in moving people and goods around Australia.

During these times, Rail Express will continue to deliver timely news and industry insights to our audience of rail professionals. Rail Express is the only publication dedicated to the rail industry that is publishing daily briefs as the story evolves. Our email newsletter database and online page views have been experiencing substantial growth over the past months, and we will endeavour to ensure that they continue to do so, even as disruption occurs.

Already, we have seen significant interest in how the rail industry will continue to be the lifeblood of Australia’s logistics supply chain. We have spoken with our key industry associations and partner organisations to understand that in fact, the demand for key rail services, particularly in the freight sector, is growing, with the resulting need for suppliers of equipment and services to continue to engage with the industry.

In addition, the growing government stimulus packages have a direct impact upon organisations working in the rail industry, many of whom are looking for the stimulus to go further so they can continue to meet the demand for mobility.

Finally, when the initial impacts of the virus subside, the rail industry will be continuing to grow as infrastructure spending is adopted by governments as a way to kickstart the economy.

More than ever, Rail Express is the resource that the Australasian rail industry turns to. The publication is continuing to grow in both print and online to meet the needs of the sector’s growth as a whole.

Industry seeks clarity on status of rail freight

The Australian rail sector is calling for a clear statement from governments that rail freight is an “essential service” and can continue to operate despite coronavirus (COVID-19) shutdowns.

“With state borders around the country closing, rail freight is more important than ever. It needs to be clear that essential services such as rail freight movements can continue during this time,” said CEO of the Australasian Railway Association (ARA), Caroline Wilkie.

The Australian Logistics Council (ALC) also reiterated the need for governments to take a definitive position on the status of rail freight.

“It would be helpful if governments at all levels reinforced this point in their communications and made it clear that freight operations will not be impeded by border closures,” said ALC CEO, Kirk Coningham.

The statement follows border closures in Queensland, Western Australia, South Australia, and the Northern Territory and shutdowns of “non-essential services” in NSW and Victoria.

In some cases, the demand for rail freight is increasing, as Matthew Roberts, rollingstock operations manager at CFCL Australia (CFCLA) highlighted.

“Our assets and maintenance workshops are running as normal ensuring the servicing, maintenance and continuation of rebuilds of rollingstock for rail operators and other rail freight shippers continues. The CFCLA leasing business is also working with customers to increase the supply of locomotives and wagons in service in some areas.”

However, as supermarkets, pharmacies, and other retail stores remain open, rail freight is required to keep supply chains moving.

“ALC’s conversations with governments and regulators at federal and state/territory level have been focussed on ensuring freight and logistics across all transport modes remain classified as an essential service. So far, that advice is being accepted, and as a result, our supply chains are continuing to function,” said Coningham.

To date, freight is yet to be told to reduce services.

“The COVID-19 situation is unlike anything we have faced, but rail freight is providing the backbone to our nation’s supply chain during these challenging times. Our members are keeping freight moving, ensuring that essential goods such as canned food, toilet paper and cleaning products continue to get to where they need to be,” said Wilkie.

Transport for NSW secretary, Rodd Staples, said that the agency will work to ensure freight continues in NSW.

“A key part of our role is ensuring goods and services are able to get to where they are needed most, including supermarkets. The team is continuing to work closely with the freight industry to ensure we don’t see any barriers emerge in critical supply chains, across roads, ports and rail.”

While curfews have been lifted for road freight to supply supermarkets and stores that have had to deal with panic buying, curfews still apply to rail freight movements. Additionally, as passenger demand drops, there is the potential for increased freight movements.

“We appreciate the need to keep critical passenger train services moving in our cities but if we see a reduction in passenger services on metropolitan networks, rail freight access should be increased to these networks to facilitate the transport of essential goods. This could include modifications to current curfews to increase frequency and availability of freight services,” said Wilkie.

Coningham also highlighted that the seamless movement of goods is critical at this time.

“Our supply chains cannot afford to have rail freight being delayed at check points for hours if we want to keep essential goods flowing. The health and welfare of Australian communities needs to be our priority – and in order to ensure it,  we have to keep food, clothing and medicines moving to the places they need to go.”

Rail freight operators are ensuring that they are able to provide a safe and reliable service to customers by increasing cleaning procedures.

“To mitigate the potential person to person contamination risk, workshop crews are being split into small teams and working hours are staggered with crews running two shifts instead of the normal day shift reducing person to person contact as far as possible. Cleaning of workshops has increased each day and between shifts and importantly cleaning locomotive cabs has been stepped up further as they pass through for servicing,” said Roberts.

“CFCLA is taking seriously the supply of goods and services necessary to the freight sector with the health and wellbeing of all Australians being paramount.”

Transport agencies respond to COVID-19 shutdown

On Sunday, March 22, NSW and Victoria announced shutdowns of non-essential services from midday, Monday, March 23.

While both states have continued to determine that public transport is an essential service, Victoria has introduced extra guidelines to keep passengers and rail workers safe from coronavirus (COVID-19).

The Victorian government has encouraged commuters to stagger the times that they need to use public transport. With the recommended distance of four square metres per person in indoor gatherings often difficult to achieve on public transport, even with reduced patronage numbers, travelling outside of peak times could be safer.

On top of measures announced last week, extra cleaning will be carried out on Victorian public transport, including trains and trams. Similarly, in Auckland personal hand sanitisers have been given to frontline staff, and new public hand sanitiser stands have been installed. Health advice has been displayed on services and in stations and stops.

Transport for NSW reiterated the advice it has given to passengers and staff to limit the spread of COVID-19.

Operators are encouraging passengers to use cashless payments, including the myki and AT HOP cards. Auckland Transport will not be accepting cash fares on buses from Monday, March 23.

Outside of the major cities, the Australian and New Zealand governments have prohibited non-essential travel. This has led to operators suspending some interstate and regional passenger services.

In Australia, The Overland, The Ghan, and the Indian Pacific have been cancelled until May 31 after Western Australia and the Northern Territory closed their borders to non essential travel. South Australia has also restricted border crossings. This closure does not apply to freight rail.

In New Zealand, KiwiRail has suspended three tourist trains, until further notice, said chief executive Greg Miller.

“Tomorrow’s TranzAlpine, Northern Explorer and Coastal Pacific trains have been cancelled and the services will remain suspended until further notice,” he said. The Capital Connection service will continue.

Miller said that safety of staff, customers, and communities was the priority.

V/Line has advised that passengers using regional services should reconsider if their journeys are essential. Café bar services on V/Line trains will not be available.

A Transport for NSW spokesperson said that regional and urban trains will continue as normal.

“We understand the important role public transport plays in the daily lives of our commuters, especially in the regions, and there is currently no plan to reduce services of trains or buses across our network.”

COVID-19 stimulus package: what it means for businesses in rail

The federal government has announced a $17.6 billion economic plan to keep Australian businesses in business, so what does this mean for the rail sector?

As the entire global economy faces significant challenges posed by the spread of the coronavirus, stimulus packages have been implemented across the nation to support small and medium sized businesses.

Prime Minister Scott Morrison said as part of the plan up to 6.5 million individuals and 3.5 million businesses would be directly supported by the package.

Caroline Wilkie, Australasian Railway Association (ARA) CEO said stimulus measures announced by the New Zealand, Australian commonwealth and state governments for small and medium enterprises, such as direct payments, asset write offs, apprentice wage subsidies, accelerated depreciation, and payroll tax exemptions will be of benefit to eligible businesses in the rail supply chain.

“However it is likely that additional government support will be necessary,” she said.

Similarly, Luke Wisbey manager – rail for civil engineering and plant hire company Brefni, noted that there is room for current stimulus measures to go further.

“The $17bn support package offered by the Federal Government is quite a significant sum and highlights the enormity of the situation facing business across all sectors including the rail industry,” said Wisbey.

“Although the package offered is substantial, the individual initiatives represent relatively small spends at a time when the economy faces mass bankruptcies. In order for businesses to survive the likely drops in revenue the crisis will generate, the government needs to be considering corporate level funding rather than ad hoc initiatives.”

Wilkie said passenger rail operators are reporting significant reductions in patronage and visible social distancing between customers on Australian and New Zealand rail networks.

At this stage, services have not been reduced. Other ARA members across the freight, contractor and supply chain are also reporting challenging conditions.

“ARA is uniting its members across all sectors of the industry to collectively address the COVID-19 situation and continues to work with our members to assess the industry impact and to engage with the government on areas where assistance can provide the most benefit,” Wilkie said.

What financial support is available?

The federal government will invest $6.7bn to boost tax-free cash flow for employers. The payment will provide cash flow support to businesses with a turnover of less than $50m that employ staff from the beginning of this year to June.

Up to $25,000 is available to help pay wages or for investment to protect against a downturn in activity.

Businesses with turnover less than $500m will be able to access a 15 month investment incentive by accelerating depreciation deductions. These businesses are also eligible for an expanded instant asset write-off for asset investments of up to $150,000. 

Similar to the relief provided following the bushfires, the Australian Taxation Office (ATO) will provide administrative relief for certain tax obligations on a case-by-case basis. 

If you’re a quarterly pay as you go (PAYG) instalments payer you can vary your PAYG instalments on your activity statement for the March 2020 quarter. Wisbey noted that thresholds here limit the amount of available assistance,

“The 50 per cent allowance on PAYG capped at $25,000 limits the target pool and those companies still need to pay net wages and super. For SME businesses, support with wages are of most concern. We support the wage assistance initiative for apprentices and trainees.”

What about investment in my business?

From March 12, businesses with a turnover of less than $500m will be able to deduct 50 per cent of the cost of an eligible asset on installation, with existing depreciation rules applying to the balance of the asset cost.

A time-limited 15 month investment incentive to support business investment and economic growth over the short term, by accelerating depreciation deductions. 

How will my state support my business?

State governments across Australia have announced their own stimulus packages which includes state support for the waiver of payroll tax, fees and charges for businesses, and additional maintenance and cleaners of transport assets.  

In NSW, the state government has announced that more than $250m will be invested to employ additional cleaners of public infrastructure, including TfNSW’s external operators statewide. This is in addition to the $450m for the waiver of payroll tax for businesses with payrolls of up to $10m for three months and raising the threshold limit to $1m in 2020-21.

Thresholds here also exclude some businesses, highlighted Wisbey.

“The proposed NSW holiday on Payroll tax is good and should be extended until the end of the year at least. The threshold has also been lifted to $1m before it kicks in. However, this is an absolute tax on employment & the threshold should be north of $5m to be more effective.”

The Queensland government will create a new $500m loan facility, interest free for the first 12 months, to support businesses to keep Queenslanders in work and extend the coronavirus payroll tax deferral to all businesses across the state.

Western Australia’s state government stimulus package includes $114 million in measures to support Western Australian small and medium businesses.

Ben Wyatt, WA Treasurer said “the state government’s stimulus package works hand in glove with the commonwealth government, and ensures these additional measures complement the stimulus announced by the Prime Minister last week.”

Specific state and territory information and assistance for businesses can be found on the federal government’s website.