Call for state-run rail service as Wakefields Transport hangs in the balance

By: Jason Whittaker


There is a push from rural Victoria for a government-run rail freight service to address the failings of the State’s

There is a push from rural Victoria for a government-run rail freight service to address the failings of the State’s rural network.

Vernon Knight from the Alliance of Councils for Rail Freight Development says the Government needs to play an active role in ensuring that farmers can export their stock, suggesting the Brumby Government invest in above rail operations to do so.

The crumbling network, which in some places forces trains to slow to a crawl, is affecting deliveries and pushing up running costs.

And with Pacific National due to stop operations to cut its losses, the Government now faces the possibility of upgrading a network but having no service to run on it.

This, Knight says, presents a strong case for the Government to run its own service while implementing much-needed upgrades in areas such as the Mildura line.

"From where the Alliance sits, we are saying ‘At least in the short-term you are going to have to be an active player because if you are not, it [the rail freight industry] may not survive," Knight says.

"Why doesn’t the State take it and then sub-contract it if they want to?"

El Zorro has indicated it is willing to expand its operations to cover grain, but Knight questions whether the niche operator has the means to pick up the slack left by Pacific National if it withdraws.

But even if El Zorro can match current services, Knight says the Government cannot solely rely on the private sector to run the service now and into the future because they will be driven to devote services to the most profitable states, or areas, as demonstrated by Pacific National’s plan to pull out.

Knight sees a future for joint services between the Government and a niche operator such as El Zorro, and bemoans the fact the Government did not take control of above rail operations when it purchased the track in April 2007.

"With the benefit of hindsight it would have been nice if they bought the rolling stock too," he says.

As long as the Government invests the right amount of resources in rail upgrades, Knight says it will enjoy a decent return on its investment.

His call for a state-run service comes amid uncertainty surrounding the future of intermodal operator Wakefields.

The family-owned company went into administration last month due in part to the poor state of the rail network.

Administrative firm Deloitte, tasked with finding a buyer to ensure Wakefields can still service the Merbein region, today closed expressions of interest in the company.

Creditors will next month meet to determine the direction in which to take the business, with Knight saying the region is quietly confident that a buyer will be found.

"There is some measured optimism about the future in that the situation may not be quite as bleak as first thought," he says.

The Victorian Transport Association (VTA) has argued that Wakefields cannot be allowed to fall, with Neil Chambers saying the trucking industry will not be able to provide the extra drivers and trucks needed to compensate.

The Brumby Government did not return calls made by ATN .

You can also follow our updates by joining our LinkedIn group or liking us on Facebook