NSW ports told to 'engage' with supply chain

NSW port operators made to “engage” with the supply chain to coordinate logistics facilities and improve efficiency

By Jason Whittaker

New South Wales port operators will be made to "engage" with the supply chain to coordinate landside logistics facilities and improve efficiency.

The NSW Government has finally responded to last year’s Competition and Infrastructure Reform Agreement (CIRA) review into port competition and regulation at Sydney Ports (Port Botany), the Port of Newcastle and Port Kembla.

Ports and Waterways Minister Joe Tripodi says the changes will require port corporation boards to consider "public policy along with commercial outcomes".

"The Government is not involved in managing our ports solely for commercial reasons – we are interested in securing economic growth by cutting costs to industry and passing those savings onto consumers," he says.

Tripodi says port operators will be required to engage with the supply chain to help improve productivity and efficiency, including facilitating and coordinating landside port facilities and supply chain services.

"We will make sure port corporations engage with industry," he says. "We want to help reduce costs and improve the reliability of cargo movements between warehouses and the port.

"This will make export businesses more competitive and imported goods cheaper, giving extra benefits to consumers."

A new framework will allow port corporations to act as coordinator of port-related supply chain services, the Government’s response states.

A new statutory function will facilitate and coordinate landside port facilities and supply chain services to meet performance standards set by the Minister.

The framework could also include regulatory powers allowing the Government to intervene if it decides voluntary initiatives are not effective in improving the efficiency of port services and supply chains.

"Regulations could potentially require port services to report on performance or to meet identified performance or pricing standards," the Government response reads.

The Government will also examine port lease policy in order to establish greater alignment between major leases and Government policy, Tripodi says.

"It is important Government sends a clear message on its policy objectives," he says.

"Major leases such as those with our stevedores need to reinforce and support the Government’s policy goals."

The CIRA review, conducted by PricewaterhouseCoopers, found "more could be done to ensure that terms and conditions of long-term leases encourage as much as possible a competitive environment in respect of leased lands and facilities".

New lease conditions could include minimum terms of duration, productivity/performance targets including incentives and penalties, and end-of-term handover provisions under the Government’s plans.

The NSW Ports Growth Plan will deliver the trade capacity needed to support the State’s economy, Tripodi says.

"These reforms will help unlock necessary future capacity by removing bottlenecks in the supply chain," he says.

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