Victoria Transport Association (VTA) chief executive officer Peter Anderson has expressed support for Victoria’s Port of Melbourne lease legislation, provided it is amended to protect port users from price increases.
Speaking at the VTA’s Port Outlook seminar in Melbourne on Tuesday, Anderson said the VTA supports the lease because sale proceeds would boost funding for much-needed infrastructure, including the Government’s level crossing program.
Related story: Port of Melbourne lease crucial to level crossing removal
However, the legislation as it stands “could adversely affect freight operators through excessive cost increases,” he warned.
Anderson added that the VTA remains to be convinced that privatisation will result in operational improvements.
“The VTA is looking for the Port of Melbourne lease to promote fair competition, greater efficiency and improved productivity,” he said.
While the Government has recently announced the schedule of rates for the licence fee, and selected Reference Tariff Schedule has only risen marginally for next year, Anderson is concerned the associated rates that will be controlled by the new monopoly operator have no direct reference, and therefore can be raised without explanation.
Meanwhile, Dr Hermione Parsons, director of Victoria University’s Institute for Supply Chain and Logistics also had concerns about some aspects of the current privatisation proposal.
While capacity forecasts for the Port of Melbourne differ, she argued that there is strong agreement that the Port of Melbourne will not cater for the proposed 50-year private lease.
As a new port will be required 15-20 years before the new lease ends, any contractual arrangements involving compensation payments should be “carefully reconsidered” Dr Parsons argued.
With Jim Wilson.
This article originally appeared in Rail Express sister publication, Lloyd’s List Australia.