The region’s peak business industry group, Business Hunter has welcomed IPART’s determination of the value of the Port of Newcastle’s one-off compensation payment.
Business Hunter CEO, Bob Hawes said Business Hunter has always advocated for a level playing field for the Port of Newcastle.
“If there is an opportunity for the Port to offer container freight services, it should be left to the market to determine where it’s cheaper and more efficient option to freight materials,” Bob said.
“The IPART determination would appear to set a reasonable hurdle price for the Port to consider, and we sincerity hope they confirm their long held ambition to diversify activity in the port and proceed with further development of their capacity to handle container freight.”
“In time, the diversification of trade in the Port will form a significant part of the transition story for the Hunter region, with the promise of jobs and economic activity to help balance the decline in coal trade they might experience in the medium to long term.”
While the details of the determination are yet to be fully examined, once complete, this payment of the compensation sum will bring an end to the legislative process, meaning Port of Newcastle will no longer be penalised for competing against Port Botany.
Port of Newcastle CEO, Craig Carmody, said with the determination figure handed down, the Port has one final regulatory roadblock to remove before meaningful progression can occur on a container terminal.
“This is a significant and historic milestone for Port of Newcastle and regional NSW, a path forward that means we will no longer be penalised for wanting to offer choice and competition in NSW container trade,” Craig said.
Approximately twelve months ago the Productivity Commission released a report that noted inefficiencies in our nations ports were costing the Australian economy about $600 million and indicated that “lack of competition in some parts of the marine logistics system” was contributing to the inefficiency and costs.
“While we are delighted that the determination has been made, we now need to ensure the NSW Freight Reform Review, which the NSW Government has commenced, also reflects the decision by Parliament to promote competition through the Port of Newcastle Extinguishment of Liability Act,” Craig continued.
“The current Freight and Ports Policy states that Port Kembla is the designated second port for a container terminal in NSW, which impacts Port of Newcastle’s ability to get planning approvals for its own container terminal.
“We hope the NSW Freight Reform Review will agree that there should be a level playing field for competition rather than the state trying to pick winners,” Craig concluded.
Bob said businesses were experiencing pressure from sharp increases in freight costs, which ultimately dampen economic growth.
“A container facility in Newcastle will increase competition and give the market more choice and potentially address this concern. That’s got to be good for the economy, business and consumers,”
“It’s an issue greatly magnified for industries producing at scale, such as the agriculture sector stretching up into the states northwest and particularly the grain growers. It’s a matter of national importance,” Bob concluded.
IMAGE | Port of Newcastle
