The federal government has committed $200.2 million to get work started on the revised Murray Basin Rail Project (MBRP). Read more
Infrastructure Victoria, the state’s independent infrastructure advisory body, has called for a business case for Melbourne Metro Two to be completed in five years. Read more
The Freight on Rail Group has called upon the federal government to fund the resumption of the Murray Basin Rail Project.
The coalition of rail freight businesses, chaired by Dean Dalla Valle said that with the Victorian government committing $48.8m in funding, the Commonwealth needed to come to the table as well.
“This commitment from the Victorian government is welcome – as a nation we need to get this rail freight network humming again. Given we could see another bumper crop next year, industry encourages the Commonwealth to also commit extra funding to help get the network back on track,” said Dalla Valle.
Getting the project back on track would improve the productivity of the Victorian rail network, and with forecast bumper grain harvests, the need for investment is critical.
“Due to well-documented problems with rail infrastructure in the basin, I’ve heard almost 70 percent of export grain this season will be transported by truck to Victorian ports – this is an extremely poor outcome for society; and certainly not good for regional councils already struggling to repair and maintain large road networks,” said Dalla Valle.
Since stalling in 2019, the partially completed project has led to a decline in freight carried by rail in the region. Groups including farmers, grain haulers, and now freight rail businesses are highlighting the importance of an efficient freight network.
“Inefficient transport supply chains corrode the core fundamentals of state and national economic productivity; destroying jobs and increasing cost of living pressures for millions of Australians,” said Dalla Valle.
The opportunity to reinvigorate the Murray Basin rail network had positives on a number of fronts, said Dalla Valle, beyond agricultural productivity. Moving more freight by rail would make roads safer for passenger vehicle by reducing accidents and wear and tear on roads. Additionally, as rail freight is less emissions intensive than road freight, Australia could reduce transport emissions. According to a 2017 Deloitte Access Economics report, for every kilometre of freight transport, rail produces 16 times less carbon pollution than road freight, and 14 times less accident costs.
Rebuilding the network would also provide a boost for regional economies and the Australian supply chain.
“Just imagine all the Australian-made steel that will be used in upgrading and standardising the network with new track – additional support for this project should be of the highest national priority,” said Dalla Valle.
With the executive summary of the revised business case for the Murray Basin Rail Project now released, farmers, grain haulers, and rail experts are renewing their call for the project to be delivered in full, as per the original scope.
The revised business case recommends that the Sea Lake and Manangatang lines remain broad gauge, while work should focus on improving the existing, separate gauge network.
GrainCorp rail commercial and contracts manager Alex Donnelly said that the proposed scope of works would return the network to a viable state.
“The proposed improvements are all quite sensible and are all going to be beneficial to the rail network in the long term. They are not going to provide the capacity and costs we’d like to see, but they are certainly improvements from the current heavily degraded state of the MBRP affected network,” said Donnelly.
Since work stalled in 2017 and 2018 and then halted in 2019, increasing volumes of grain from North West Victoria have had to be hauled by road. In 2019, when NSW and Queensland were in drought, the relatively good conditions in Victoria meant that grain grown along the Sea Lake and Managatang lines missed out on markets and higher bid prices in northern NSW, as the grain could not be moved via rail on the interstate standard gauge network.
“Those farmers on the Mananagatang and Sea Lake sites really missed out, because their grain could only flow south by rail to Geelong or Melbourne, or by truck into southern NSW homes – where the bids weren’t as strong,” said Donnelly.
Victorian Farmers Federation grains group president Ashley Fraser said that the proposed works would create two separate networks.
“A commitment was made to build the Murray Basin Rail Project five years ago, including the standardisation of the Sea Lake and Manangatang lines,” he said.
“Under this revised plan these lines will not be converted to standard gauge resulting in farmers and businesses along the broad-gauge Sea Lake and Manangatang lines effectively being cut off from the standard gauge Inland Rail network.
“Ultimately this means double handling of freight which results in added costs for farmers, especially in the important grain growing regions in Victoria’s north west.”
John Hearsch, Rail Futures Institute president, said the proposed scope of works would not be able to handle the projected increase in freight volumes.
“It’s probably sufficient for the short term but, as I see it, I don’t think it properly takes account of what needs to happen in a bumper grain harvest which is what we’re about to experience. The outcome of that will be pretty straightforward; we’ll have a lot more trucks on the road than we really should have.”
Hearsch also highlighted that if the works proposed in the revised business case go ahead, while there will be marginal improvements, the plans locks in inefficiencies, such as standard gauge trains on the Mildura line from Yelta and Murrayville having to travel further to get to the port of Geelong or Melbourne via the Maryborough to Ararat connection, rather than directly via Ballarat.
“I find that quite disappointing and it still means that notwithstanding some marginal improvement on the journey from Maryborough to Ararat, these trains are still having to run well over 100km extra distance, which takes extra time and involves extra cost. That looks like a semi-permanent feature of what this part of the rail network is going to look like.”
Other potential projects that depended upon the full completion of the original Murray Basin Rail Project are also looking to miss out in the revised plan. In Ouyen, a local community group that has been working to set up an intermodal terminal is furious that the revised scope will not include a standard gauge connection to Melbourne.
“The MBRP was to be a ‘once in a generation’ project for the ultimate benefit of all Victorians and we are hoping governments will sort through the current MBRP quagmire very soon, to ensure it gets completed as originally planned. The Victorian government’s announcement will result in the Ouyen train having to go on a five-hour detour via Ararat making it unsustainable,” said Ouyen Inc president Scott Anderson.
Having two separate gauges in Victoria would also place increased cost pressures on businesses, said Donnelly, and could lead to the broad-gauge network becoming a stranded asset.
“Rollingstock owners need to keep their aging broad-gauge gear alive and running, which gets more expensive every year as spares and parts become harder to source. The broad-gauge network misses out on the expensive new gear that cascades out of the big coal and interstate operations, while standard gauge sites will see the benefits of this equipment.”
One of the reasons cited in the business case summary for the change in scope to let the Ballarat corridor remain broad gauge was the potential disruption to passenger services. Hearsch said that with proper, integrated planning between Victorian government bodies, this could have been avoided.
“Of course, the freight upgrades should’ve been accounted for in the upgrades of the passenger network, that didn’t happen. The reason it didn’t happen, as I read it, is that the Ballarat line upgrade and the Murray Basin Rail Project, both of which affected Ballarat, those two projects didn’t talk to each other.”
With the Murray Basin Rail Project having been heavily criticised by the Victorian Auditor-General in a report early in 2020 for deficiencies in planning and project management, Donnelly said it was critical that the revised project is handled correctly.
“For this coming 20/21 harvest these improvements will probably not provide any benefit to rail capacity. It’s very unlikely that any of the significant components of the proposal could implemented in time to help the coming harvest export task,” said Donnelly.
“In fact, we hold strong concerns that the proposed works pose a risk to an already constrained rail network: construction closures and trackwork blocking lines will stop the trains from exporting grain and we are expecting rail to be running flat out all year long.
“Any major shutdown will reduce rail tonnes moved to port, which will transfer straight to road instead. We need very careful consultation, coordination, and planning by the department to mitigate the impacts on the industry.”
Fraser said that the original aim was the correct one and should be carried out.
“The original vision was for a modern, efficient regional rail freight network. While the execution to achieve this vision may have been flawed, the intention was right.”
The Victorian government has released the revised business case for the Murray Basin Rail Project and dropped the project’s initial goal of standardising the region’s freight network.
The long-awaited business case outlines the way forward for the troubled project, which halted in mid-2019 due to a lack of funds.
With stage one delivered and stage 2 partially delivered, the Murrayville and Yelta lines were standardised and the Maryborough to Ararat line reopened as standard gauge. The Sea Lake and Manangatang lines remained broad gauge, and the revised business case proposes to continue this split.
Victorian Minister for Transport Infrastructure Jacinta Allan said that the Victorian government was disappointed that funding for the project was not included in the 2020 federal budget, and was the only project on the state government’s wishlist of projects to not receive funding.
“This project is too important to play politics with – we want the Commonwealth to come forward with their support so we can get more freight on trains and more trucks off regional roads.”
To complete the revised scope of works, the Victorian government has announced they will commit $48.8 million and are asking the federal government to contribute $195.2m.
Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack said that the federal government had already contributed $240m to the project and that project errors were the responsibility of the Victorian government.
“It is important to remember that the Victorian Labor government was responsible for delivering this project and actively chose to lay 100-year-old steel as part of its ‘upgrade‘,” he said.
“I look forward to hearing the views of industry and communities on the proposal and document released yesterday by the Victorian government.”
The report notes that the time and cost of delivering the project to its original scope has now increased and there is greater potential for conflict with passenger services in the standardisation of the Gheringhap to Ballarat section and the Ballarat corridor.
The Rail Freight Alliance (RFA), a grouping of councils pushing for more freight to be handled by rail, said in a statement that the revised business case amounted to fixing problems caused by the initial works.
“What it appears Minister Allan has announced today is repairs to the shoddy and substandard work that has hampered this project from the inception. Rerailing the section of line between Maryborough and Ararat that was done as part of the project in 2017 with some sections of century old rail and putting back some staging areas that were removed as part of the MBRP only a few years ago.”
Works to be immediately completed under the revised business case include re-railing 88km on the Ararat to Maryborough line, where old rail was re-used, signalling works at Ararat Junction and Maryborough Yard. Further works include passing loops, instituting electronic train ordering, resleepering, and improvements to sidings.
Minister for Ports and Freight Melissa Horne said that if funded, the project would increase export volumes.
“These works will boost our freight network’s capacity and efficiency to get more Victorian products exported. We just need the Commonwealth to come to the table with their support.”
Victorian farmers were disappointed that in last week’s federal budget there was no more funding for the Murray Basin Rail Project.
While a business case has reportedly been prepared for the resumption of upgrade works to standardise freight rail lines in the north-west of the state, the funding initially committed has run out and Victorian Farmers Federation David Jochinke said the project needs to continue.
“For the Murray Basin Rail Project to miss out on funding is incredibly disappointing,” Jochinke said.
“The onus is now on the Victorian government to show leadership and commit to funding the project as promised as we enter its sixth year of construction.”
In an interview with ABC radio Ballarat, Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack said it was up to the Victorian government to release the business case before federal funding could be committed.
“[The Victorian government] needs to come up with that business case to release it so that there’s full transparency, full accountability. The federal government has already contributed more than $240 million and I’m happy to continue to work with the Victorian government.”
The Rail Freight Alliance, a grouping of councils across Victoria, said that both governments needed to work together to ensure the project is completed.
“The Mexican standoff between the federal and Victorian government is a convenient out for both governments, it doesn’t solve the problem and leaves the people of Victoria and the nation poorer for it,” the group said in a statement.
The Rail Freight Alliance said the Murray Basin Rail Project was an ideal project to get the state’s economy moving again.
“This project ticks all the boxes, it’s shovel ready, will boost jobs, attract private investment, support businesses to recover and grow, enhance Victoria’s growing exports and freight task. Now is the time to invest in this nation building project.”
New projects and upgrades to existing technology should be considered for funding as part of the federal budget, CEO of the Australasian Railway Association (ARA) Caroline Wilkie has said.
With the budget to be handed down on October 6 and early announcements already coming out, Wilkie said that rail was ready to contribute to Australia’s economic recovery.
“There is a significant pipeline of rail investment that could be fast tracked to generate more jobs and opportunity to support our economic recovery,” said Wilkie.
“This is work that will make a difference right now while leaving a lasting legacy for the cities and towns that benefit from new rail projects.”
A number of rail projects are awaiting federal funding to take the next step. The Melbourne Airport Rail Link will proceed once final funding from the federal government confirmed, as can the resumption of the Murray Basin Rail Project, with a business case sitting with Canberra.
In addition to new construction, funding for technology upgrades such as the Australian Rail Track Corporation’s Advanced Train Management System, would provide long term benefits. Infrastructure upgrades such as level crossing removals are another way the federal government’s funding to rail would conitrbute to wider economic outcomes.
“At a time where we desperately need more people in jobs and more certainty for those rebounding from the economic hardships of the pandemic, we need to see more projects started sooner to build the country back up again,” said Wilkie.
Deputy Prime Minister and Minister for Infrastructure, Transport and Regional Development Michael McCormack has indicated that major infrastructure projects will be part of the 2020 budget, however no particular projects have been tipped yet. The federal government has indicated that money allocated to the states for infrastructure will be needed to be spent quickly and may be a condition of further funding.
After data showed that the Rainbow-Dimboola line had carried 33 return freight services and 66,000 tonnes of grain since it was reopened in April, the Victorian Farmers Federation (VFF) is calling on governments to upgrade regional freight lines.
VFF grains group president Ashley Fraser said that the grains industry in the Wimmera and Mallee regions had a high demand for rail freight.
“We know the demand is there, industry knows the demand is there and here is the government’s data demonstrating the demand is there. All that is required is a willingness to get on with the job,” said Fraser.
Freight demand in Victoria is expected to triple by 2051 and rail is seen as vital to take a greater share of this demand.
“The government should heed their own message in this case – improvements to Victoria’s regional rail freight network will take trucks off roads resulting in lower freight costs and better road maintenance and safety outcomes,” said Fraser.
So far, major upgrades to the network of freight lines which connect Victoria’s agricultural regions to its ports have stalled since the halting of the Murray Basin Rail Project. A bumper grain crop in 2020 and calls for infrastructure funding to boost COVID-19 affected economies are driving demands for the project to be restarted.
Funding for regional rail improvements was part of the Victorian government’s COVID-19 stimulus package, however focused on resleepering existing lines, rather than opening new lines or gauge conversions.
Fraser said that now was the time for the Victorian government to act and these projects would have the support of farmers.
“If the Victorian government build it, absolutely, the trains will come.”
Victorian Minister for Public Transport Ben Carroll has suspended V/Line CEO James Pinder.
Carroll made the decision due to advice from the Department of Transport that the Independent Broad-based Anti-Corruption Commission (IBAC) had launched an investigation.
“On the basis of that advice, I directed the V/Line Board to immediately suspend Mr Pinder, while IBAC carries out its investigation,” said Carroll in a statement.
Nick Foa, who is currently head of transport services at the Department of Transport will step into Pinder’s role.
According to reports, IBAC is investigating the Department of Transport but is not providing any further information.
V/Line previously came to the attention of IBAC in its investigation into TAFE qualifications for workers.
V/Line and the Department of Transport were also subject to criticism by the Victorian Auditor-General over their handling of the Murray Basin Rail Project, with the stalled project having “not met scope, time, cost or quality expectations”.