Facility access fee opponents hit ministerial wall

By: Rob McKay


Pavey and Chester see surcharges on third party and non-contracted stakeholders as commercial decisions

Facility access fee opponents hit ministerial wall
Melinda Pavey and Darren Chester fail to see a reason to intervene

 

Trucking representatives and others battling terminal access fees have all but run out of political and regulatory options, even as the spectre of their continued spread is raised again and other options are canvassed.

The latest to make public his concerns about the steady injection of increasing costs into the supply chain and its service operators is Paul Zalai, director of Freight & Trade Alliance (FTA), the international supply chain sector representative body for importers, customs brokers, freight forwarders and logistics service providers that is aligned with the Australian Peak Shippers’ Association (APSA).

His intervention comes after a meeting with Qube Logistics, which recently announced an container freight station access charge, the International Terminal Fee (ITF), after Qube stevedoring subsidiary Patrick joined rival DP World in charging haulage firms for shipping container access at port terminals.

The stevedoring charges followed state port lease sales resulting higher port land rental and other costs being passed on, with those down the line criticising the way this is implemented, with every link now burdened with cost-recovery procedures.

Opponents have tried seeking political and regulatory relief – approaching ministers and the Australian Competition and Consumer Commission (ACCC), whose chairman, Rod Sims is a critic of recent port privatisations – but failed to make progress.

"While Qube Logistics are aware of industry concerns, they must have done the sums and conclude that they will be adequately compensated with a new revenue stream from the arrangements," Zalai explains.

"The onus now clearly lies with industry to respond by either accepting the charges and move on, or to take business elsewhere.

"Is the latter option viable? Are there neutral wholesale services available using alternate depots? Are these depots at capacity? Is it time for independent depots nationally to come together as a consortium to provide a viable alternative?

"Our fear is that rather than healthy competition entering the market, other depots will do as we have witnessed with the stevedores and simply ‘follow the leader’ with the introduction of similar surcharges.

"We certainly hope that this is not the case and would be delighted to promote any alternative solutions."

A Qube spokesman was unable to say if any surcharge would apply to its Moorebank intermodal terminal, telling ATN that it is "probably two years too early" to consider it. 

VTA

The Victorian Transport Association (VTA) takes a pragmatic line, accepting that the injection of extra costs is a general national trend and advising of the logical next step.  

"The VTA’s position is that as regrettable as new and higher fees and charges are, they are a part of doing business at a time when costs everywhere are increasing across the board," VTA CEO Peter Anderson says.

"Ultimately costs have to be passed on through the supply chain to consumers – if they aren’t, operators will go out of business.

"What’s important is that when new or higher charges are introduced, they are clearly explained and justified, and the operator given a reasonable amount of time to plan for the increase and notify their customers of any pricing impact.

"Of course, where a new fee or higher charge cannot be justified, we will ask for an explanation on behalf of the industry, and take further action where warranted."

Chester and Pavey

Federal and state politician ATN has raised the issues with refuse to address the issues those opposed to the extra charges raise.

"The federal government is currently undertaking an inquiry into Australia’s National Freight and Supply Chain Priorities, with a draft report to be made available by December 2017," federal infrastructure and transport minister Darren Chester tells ATN.

"The imposition of these charges remains a commercial issue and my Department is unaware of any action being taken by the ACCC on these matters."

Chester’s comments chime with the New South Wales government view.

"This is a commercial decision of a private company," a spokesman for NSW roads, maritime and freight minister Melinda Pavey tells ATN.

It is understood charges opponent Road Freight NSW got the same message from Pavey.

ATN has sought a response from federal opposition transport spokesman Anthony Albanese.

ASBFEO

The remaining government option for those against the charges is Australian Small Business and Family Enterprise Ombudsman (ASBFEO), Kate Carnell, who has been observing developments.

"With the ACCC not seeing it as a market power/competition issue, we will look at possible next steps to see if we can get the parties around the table to discuss a way forward," an Australian Small Business and Family Enterprise Ombudsman (ASBFEO) spokesman tells ATN.

FTA and APSA

Zalai says the FTA discussed the ITF’s introduction with Qube Logistics executives on Monday.

It was explained that FTA and the APSA "have a high priority focus on removing the rapidly increasing trend towards surcharges on third party/non-contracted stakeholders".

"Qube Logistics again reiterated the need to recover increasing operational costs," Zalai says.

"FTA argued that like most commercial entities, costs need to be absorbed or passed on to commercial clients, in this case being cargo wholesalers and direct freight forwarder clients.

"FTA provided member feedback that fallout from the introduction of this arbitrary surcharge may lead to business being taken away from Qube Logistics.

"Qube Logistics acknowledged the issues raised but showed no indication that they would deviate away from this cost recovery model. It appears as though they are prepared to ‘weather the storm’ of criticism and proceed as planned with their implementation."

Qube has been approached for comment about the meeting.

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