PDF: 4470 KB - Infrastructure Australia


PDF: 4470 KB - Infrastructure Australia

Toll Group Response To Infrastructure Australia’s

National Land Freight Strategy Discussion Paper

May 2011


Toll Group

Toll Group is the Asian region’s leading provider

of integrated logistics services. With annualised

revenue in excess of A$8 billion, we employ

around 40,000 people via a network of 1,200

sites in 55 countries. Toll Group’s substantial

international presence makes it perhaps the most

geographically diverse Australian multinational.

In Australia, Toll directly employs around 20,000


Toll’s first class collection of and access to

transport and infrastructure assets, including road

fleets, air and marine capacity, warehousing, ports

and railways, help the company achieve world’s

best practice in supply chain management. The

company’s integrated logistics strategy combined

with smart technology, which connects services

and interfaces with our customers, provides

our most powerful point of differentiation in the

market place.


Key Recommendations

We support the action areas identified by Infrastructure

Australia in the Discussion Paper in the following order of


1. Priority Area 1: Identification of a national land freight


Ideally the identification of a national land freight

network should be the first step in achieving:


Dedicated freight corridors free from ‘last mile’

access issues such as those preventing efficient

use of key pieces of national infrastructure,

including Australia’s ports and airports, and major

manufacturing facilities;


Modern, efficient logistics infrastructure such

as intermodal hubs free from congestion and



Collaboration along supply chains;


Each mode of freight being a competitive option;


Simple and consistent regulation with national

uniformity, e.g. Chain of Responsibility legislation;


Minimal handling;

hubs and large customer infrastructure;


The reservation of identified land for future needs;



Safer modes of transport for all users.

2. Priority Area 4: Freight infrastructure improvement and


A safe, reliable, sustainable, productive and

competitive freight transport and logistics industry

depends on all tiers of Government addressing freight

infrastructure deficiencies and delivering improved


3. Priority Area 5: Governance

Governance arrangements that ensure nationally

consistent outcomes, transparency and accountability

will deliver improved efficiency and productivity.

4. Priority Area 3: Ensuring plans can be executed

5. Priority Area 2: Completion of a strategy


Use of new technologies to improve safety and

environmental outcomes;


Appropriate planning regimes around intermodal



Freight capability drives and facilitates economic growth.

Australia’s place in the world depends on the productivity

and efficiency of supply chains. As noted in the National

Land Freight Strategy Discussion Paper “the freight sector

is a substantial economic activity in Australia generating

economic growth, employment and accounts for a

significant share of GDP.” Unfortunately, in our experience

the standards and efficiency of Australia’s nationally

significant port, road, rail and aviation infrastructure varies

widely, undermining the industry’s potential contribution to

Australia’s economy.

At best, elements of the national land freight task are

capable of accommodating moderate future growth.

However, at worst, the freight task is characterised

by bottlenecks, undercapitalised infrastructure and

inadequate planning to buffer freight movements from

residential areas and enable future growth. Inaction and a

lack of policy direction by Governments in particular has in

some key metropolitan areas resulted in the freight industry

becoming increasingly subject to congestion, inefficiency,

increased surveillance and higher costs. Not only has this

led to increased regulation and red tape, but it has also

undermined national productivity and proven detrimental

to safety, business prosperity, community amenity and

the environment. As the freight task increases, we believe

these problems will be compounded.

As noted in the Discussion Paper, Australia’s freight task

is expected to double between 2000 and 2020, and by

2050 be triple its current size. The projected growth in

Australia’s population to 36 million people by 2050 will

have significant implications for the freight transport and

logistics sector. It is essential that all tiers of Government

work quickly with industry to undertake the investment

and reform necessary to ensure the benefits of the sector’s

growth are not squandered.

Toll Group welcomes the Infrastructure Australia

Discussion Paper on National Land Freight issues.

Toll Group believes it is well and truly time to address

the under-investment in freight transport and logistics

infrastructure, develop a nationally consistent approach to

managing the future freight task and quarantine the sector

from further short-sighted political decision-making.

This submission outlines some of Toll Group’s thoughts

on how to ensure Australia’s national land freight

task can accommodate future growth and demand,

highlights which priority areas identified by Infrastructure

Australia should be actioned first and reaffirms the

Company’s commitment to working with Governments

and bureaucracies to resolve the challenges confronting

Australia’s freight transport and logistics industry.


Land Freight Transport and

Logistics in Australia in 2011

The Australian Logistics Council estimates the Freight

Transport and Logistics industry generates approximately

14% of Australia’s GDP and its 165,000 companies

employ more than one million Australians. As the

Discussion Paper notes, the land freight transport industry

is dominated by road freight, with rail freight contributing

smaller market share.

Toll Group is mode neutral; the Company has Business

Units that operate in each of the road, rail, maritime and

aviation sectors. For that reason, the Company supports

freight transport planning and decision-making that is nondistorting

and competitive neutral. We strongly support

the development of a freight strategy that considers the full

costs of externalities on each sector. We would strongly

discourage any suggestion that Governments should

promote one mode of transport at the expense of another.

That would inevitably lead to loss of productivity.

It is important that Governments and bureaucracies

recognise that customers also have a key role to play

in land freight transport planning; it should not solely be

the responsibility of freight transport businesses. Due to

the size and scale of Toll Group we are able to offer our

customers a range of logistics and supply chain solutions

across modes, and ultimately it is the customers’ choice

as to which mode they utilise. Generally customer decision

making will come down to issues of timeliness, handling

efficiencies and cost.

Concern about Australia’s future freight capability is not

new. There have been a number of reports in Australian

State Government jurisdictions about the infrastructure

requirements necessary to plan for the future freight task.

Toll Group has found the responsiveness of successive

Federal and State Governments to addressing important

freight transport and logistics issues varies widely. While

a number of jurisdictions acknowledge the importance of

freight transport, there are many that lack understanding

and political will to address the issues faced by companies

such as ours. For example, there are numerous instances

where key locations and corridors identified for essential

transport infrastructure have been compromised due to

inappropriate planning and decision paralysis.

Equally worrying has been the lack of interaction between

Governments, bureaucracies and industry. While there

is considerable engagement with the community on

important issues of safety, on other issues such as future

infrastructure requirements and in situations where

personal transport and freight considerations merge there

has been little interaction.


The private sector has to date been understandably

reluctant to invest in major freight infrastructure projects

because of the number of land transport regulators,

volume of regulation and the lack of certainty that

Governments pressured by external factors won’t change

the rules.

While private sector transport companies like Toll Group

are looking for opportunities to contribute to improved

freight transport strategies and efficiencies, we strongly

believe Federal and State Governments also have an

obligation to provide genuine, lasting, policy reform and

new investment, particularly in those instances where

freight operators are required to share infrastructure with

the public.

required to overcome the land freight sector’s constraints

and challenges. However, funding and access arguments

between road asset managers, community concerns and

political paralysis have stymied numerous initiatives to

improve productivity and efficiency. For some cities and

transport corridors in particular, we are concerned that it

may be too late to address all the challenges facing the


As the Discussion Paper correctly identifies, issues

such as infrastructure use, infrastructure pricing and

investment, congestion, land use planning and varying

transport regulation have shaped the land freight transport

sector into its current form. In our opinion the problems

facing the sector are so great they cannot be resolved

without extensive reform and close cooperation between

Government and the private sector.

Companies like Toll Group and industry associations like

the Australian Logistics Council are well aware of what is


The Future Land Freight Task and

the Challenges Ahead

Toll Group believes the aim of Governments and industry

alike should be to ensure the land freight transport and

logistics industry operates on a safe, reliable, sustainable

and competitive footing throughout Australia. With the

national freight task expected to double between 2000

and 2020, it is essential that Governments work quickly

to undertake the reforms necessary to capture economic

benefits and employment opportunities. Priority should be

given to those cities and major routes central to the future

freight task.

productivity to date. Without action by road and rail

access managers from all three tiers of Government

to remove access constraints (including ‘last mile’

issues), changed attitudes by Governments so freight

considerations are routinely incorporated into decision

making processes and the provision of nationally

consistent regulation and decision-making processes

that encourage investment, the identification of a network

could be futile.

As the Discussion Paper notes, comprehending the size

of the future land freight challenge and what infrastructure

is required to support it is an important first step. On

this basis Toll Group supports as the key area for action

the Discussion Paper’s Priority Area 1, namely the

identification of a national land freight network. Without

the identification and publication of a national network we

believe attempts to achieve policy consensus between

Governments and successfully make the case for public

and private sector investment will fail.

The identification of a national land freight network

however is likely to be only the first step to achieving a

resolution to freight transport issues that have slowed

the industry’s efforts to achieve greater efficiency and


Comment on Other Issues Identified

in the Discussion Paper

Funding Future Freight Infrastructure


We believe that Governments, industry and private

sector investment each have a role to play funding the

provision of a national land freight network. Numerous

comments within the Discussion Paper suggesting that

the “economic argument for general taxpayer support of

infrastructure principally used for commercial activities is

weak” ignores the fact that:


There is very little infrastructure that is principally

used solely for commercial activities. As noted

in the Discussion Paper a substantial majority of

freight infrastructure is provided on a shared-use

basis between freight and public stakeholders.


Freight infrastructure is subject to numerous

regulatory environments, often in a contradictory

and nationally inconsistent manner.


The use and provision of infrastructure is subject to

political interference and regularly changing policy

directions undermining private investor confidence

in funding initiatives. As the Discussion Paper notes

‘freight externalities’ and ‘community disquiet’ can

limit freight productivity and act as a deterrent to

private sector infrastructure investment and fail to

encourage transport users to pay their way.


Consideration of funding on a market use basis

is appropriate, but as the COAG Road Reform

Plan (CRRP) is discovering can be difficult in

application. Furthermore, in our experience there

are Governments and bureaucracies that don’t

always want to act on the market signals they

are receiving. For example, aeronautical users of

airports consistently call for increased economic

regulation of airport services while fund managers

warn that increased regulation would undermine



Private sector investment in major infrastructure

is welcome, but often seeks certainty in the form

of regulatory concessions, including the right to

engage in monopolistic behaviour and excessive

charging leading to inferior outcomes for transport

operators and customers.

Improved Planning Regimes in All


Little is being done in some jurisdictions to safeguard

existing freight networks, let alone establish new ones

capable of handling an expanded freight task. Declaring

road freight routes of national significance as ‘High


Productivity Freight Networks’, preserving freight corridors

and establishing consistent environmental approval

arrangements for freight infrastructure would alleviate

some of the short term concern about how Australia will

cope with an expanded freight task.

There are limited avenues to upgrade existing roads to

meet the future freight task and heavy vehicle access at

present is largely determined by whether the truck fits the

road. This short-sighted approach needs to be replaced

with the adoption of strategies that allow for easier

upgrades of road to accommodate freight vehicles and

the future introduction of high productivity freight vehicles

(HPV). For roads identified in a national land freight

strategy as future HPV freight networks consideration

will then need to be given to funding their progressive

upgrade. When new, freight-significant roads are under

construction, augmented over-taking lanes, larger road

shoulders and interchange lane formats should all be

considered, as they have been in Europe.

Toll Group was pleased to see that the Discussion Paper

considered issues beyond simply the obstacles to the

identification and establishment of a national network.

As noted earlier in this submission, the achievement of

a more efficient and productive freight task is hindered

by concerns such as ‘last mile access’ issues in some

instances requiring small infrastructure upgrades that are

unlikely to attract private sector investment. For example

the problems caused by inadequate bridge infrastructure

in many NSW Local Government areas. It is also important

to note that often it is not the linehaul task (both on road

and rail) that is the inefficient component of the journey,

but a transport operators’ inability to successfully load and

unload the freight at either end in a timely or cost efficient

manner, or in reasonable proximity to the customer base.

Planning regimes that acknowledge unique requirements

of the freight industry, such as the need for rest stops and

other roadside facilities used by truck drivers would be

a welcome first step. Such facilities have been provided

largely on an ad hoc basis to date, and we are aware

of instances where the development of facilities has

been stymied by community disquiet to the detriment

of industry on nationally significant freight routes. Not

only do these sites contribute to improved productivity,

but more importantly they can contribute to enhanced

safety outcomes. Improved planning regimes and funding

for such facilities is one small way in which jurisdictions

can demonstrate their infrastructure priorities include

consideration of the future freight task.


Achieving Nationally Consistent


Although not canvassed in detail, the Discussion

Paper acknowledges that a number of initiatives are

currently underway to achieve national consensus

amongst jurisdictions and stakeholders involved in the

freight transport and logistics industry including via the

establishment of a National Heavy Vehicle Regulator, the

Council of Australian Governments Road Reform Plan

and Capital Cities Strategic Planning Systems, and work

being undertaken by Infrastructure Australia, including the

National Ports Strategy and National Freight Network Plan.

The right, nationally consistent regulation is essential

from both a safety and national productivity perspective.

Failure to reach consensus on these initiatives will

undermine efforts to establish a national freight network

capable of efficiently handling the future freight task. Toll

Group is strongly supportive of efforts by all Australian

governments, the National Transport Commission (NTC)

and industry to establish a National Heavy Vehicle

Regulator (NHVR). We firmly believe a single national

heavy vehicle regulator managing regulations that are

consistent throughout Australian jurisdictions will not only

boost national productivity and efficiency, but will also

contribute to improved safety. Throughout the process of

reviewing the draft Heavy Vehicle National Law (HVNL) we

have been concerned to see that jurisdictions have been

unable to reach consensus on a number of key items such

as heavy vehicle licensing and the application of fatigue


Progress made in other aspects though should vastly

improve some elements of the national land freight task,

such as the NHVR’s plans for a one-stop shop for access

permit applications. The existing requirement whereby

road users seek access permission from numerous

agencies / authorities including road and rail transport

authorities, private road owners (toll roads), local councils,

bridge owners, port and airport operators and irrigation

authorities is inefficient, time-consuming and costly.


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