ACCC head sees flawed privatisation as harming supply chains
DP World Australia (DPWA) appears to have found an unlikely ally in its defence of new levies for Port Botany and the Port of Melbourne.
It has seized upon comments by ports privatisation critic and Australian Competition and Consumer Commission (ACCC) chairman Rod Sims, made at the Australian Logistics Council Forum in Melbourne, touching on increased costs imposed on stevedores by private port companies.
DPWA quotes Sims, whose organisation has taken stevedores to task in the past over lack of competitive essence in the sector, as speaking of his frustration over a “privatisation debate where we privatise monopolies without any regulation and that damages the supply chain.
“I mean that’s where the problem gets landed. Look we’ve just had this week DP World announce some infrastructure charges that has causing an outcry amongst those who shift containers.
“But I have to say, where was that outcry when Port of Melbourne wanted to increase the rents by 750 per cent as they were privatising the port?”
He continues that the increases ended up being “very small but those increases are what are reflected in those infrastructure levies that DPW is proposing so imagine what that would have been if we hadn’t had that roll back of the 750 per cent increase in rents.
“So I think it would be really helpful if the supply chain was more engaged in this debate as you’re the ones who end up paying.”
DPWA CEO Paul Scurrah, whose company has been under sustained criticism from the container trucking sector at being lumped with its ‘infrastructure surcharge’ and the manner in which it was formulated, welcomed the comments as sheeting responsibility home to the source.
“We consider the introduction of the levies reflective of the commercial realities facing terminal operators across industry,” Scurrah says.
“Over the past three years, DPWA has improved truck turnaround times and continued to invest in both road and rail infrastructure at each of our terminals to the benefit of all landside operators.
“For example, in Sydney this equates to a 35 percent improvement in road efficiency for road carriers and a 37 per cent improvement in rail efficiency over three years.
“At the same time, our occupancy costs including higher rent, land tax and council rates have increased between 30 to 60 per cent with further increases expected in coming years.
“As a result we will be introducing infrastructure levies at both the Melbourne and Sydney terminals commencing 3 April, 2017.
“This will bring these terminals in line with Brisbane which has had a levy in place for the past six years.
“We will continue to work with the industry around the introduction and implementation of the levies and efficiencies going forward”.