Albanese commits to Tasmanian freight subsidies

Rudd Government will retain Tasmanian business subsidies to protect the State's freight and wheat industries from the global economic crisis

The Federal Government will retain Tasmanian business subsidies in an effort to protect the State’s freight and wheat industries from the global economic crisis.

Minister for Infrastructure and Transport Anthony Albanese yesterday announced the Government would continue the Tasmanian Freight Scheme and Tasmanian Wheat Freight Scheme in their current forms.

Both schemes subsidise the State’s industries due to the disadvantages caused by moving cargo across Bass Strait by sea, rather than road transport.

Based on an analysis by the Bureau of Infrastructure, Transport and Regional Economics (BITRE), road freight costs have continued to rise significantly higher than sea freight costs the past decade.

"Adjustments to the parameters would significantly reduce overall assistance levels resulting in a significant negative impact on Tasmanian businesses at a time of global financial uncertainty," Albanese says.

Albanese says the Government reached its decision after considering the 2006 Productivity Commission Inquiry Report and the Tasmanian Freight scheme parameter review draft report prepared by BITRE.

"The Tasmanian Freight Scheme is critical to Tasmanian industry," Albanese says.

"Accordingly the Government has agreed to maintain current levels of assistance and use the parameters which have been in place for the past 10 years."

The schemes will be reviewed in four years.

More than $101 million in funding has been made by the Government this year, which aims to implement a number of administrative and developmental changes such as auditing and compliance arrangements as well as upgraded IT systems.

Albanese says the measures are important to safeguard the integrity of both schemes.

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