National infrastructure coordinator says subsidy to assist Tasmanian exporters is "reactive, disjointed, fragmented and costly" and possibly open to rorting
By Rob McKay | May 28, 2012
The Tasmanian Freight Equalisation Scheme might be safe under the present Federal Government but Infrastructure and Transport Minister Anthony Albanese will be hard pressed to ignore the rest of a deeply critical assessment of it by National Infrastructure Coordinator Michael Deegan.
The 36-year-old scheme helps cover the extra transport costs, including trucking, faced by Tasmanian exporters for doing business in the island state.
But Deegan, in his preamble to the report, A New Deal for Tasmanian Exporters, cast the $100 milion a year scheme as “reactive, disjointed, fragmented and costly” and possibly open to rorting.
Albanese had called for a report in March, when announcing a one-off $20 million support package in lieu of more cash for the scheme.
On the possibility of fraud, of which direct evidence had been lacking, despite a number of allegations made to him, Deegan advises a Federal Police investigation.
Crucially for road operators, many of which operate networks to and from the state, he advises non-bulk freight between Tasmania and mainland be included in any equalisation scheme.
Deegan also wants an Australian Competition and Consumer Commission (ACCC) review of shipping costs and competition.
He believes the subsidy cossets Tasmanian industry and should be replaced with a GST allocation or reduced by 10 percent a year with the savings aimed at infrastructure improvements.
He calls for a freight coordination team, including an industry leadership group, to examine planning for the use of super B-doubles on Tasmanian roads and maximise the benefits of the Brighton Intermodal Hub.
“To date, Infrastructure Australia has not received a proposal for road improvements specifically targeted at modern truck technology for Tasmania,” the report says.
Albanese has pledged to look into the report’s recommendations, other than the scheme’s abolition, especially the possibility of fraud.