Tasmanian Freight Equalisation Scheme gains extension

The $203 million will add more exporters to those eligible for a $700 per container subsidy

Tasmanian Freight Equalisation Scheme gains extension
Will Hodgman says it will give the state a major boost.


The Federal Government has announced an extension to the Tasmanian Freight Equalisation Scheme (TFES) of $203 million over four years.

From January 1 next year, the $700 per container subsidy will apply to exports goods heading to a broader range of markets.

Currently, only those bound for Melbourne receive the payment, along with all imported containers.

Shippers from King Island and the Furneaux group of islands in Bass Strait will be eligible for a 15 per cent additional loading.

The total extension represents a more than 40 per cent increase on the $98 million currently allocated to the TFES each year.

"Shipping and freight services are critical to Tasmania’s competitiveness," Prime Minister Tony Abbott says.

"The equalisation scheme helps the state’s businesses compete with businesses from other parts of Australia."

A continuation and extension of the TFES had been expected since the Abbott Government took office in 2013, despite a 2014 Productivity Commission report advising the scheme "falls well short of what is needed to improve the lagging competitiveness of the Tasmanian economy".

"We are committed to retaining the TFES and to making it more effective and more targeted," Abbott says today.

The decision has been welcomed by the state government. Premier Will Hodgman says it will give the state a major boost, "lifting our economy to a new level".

"This is an outstanding outcome for Tasmanian businesses and will generate economic growth and jobs in the state," he says.

"This is yet another example of the good outcomes that can be achieved for Tasmania by working cooperatively with the Federal Government, and I congratulate (it) for backing Tasmanian exporters in this way."

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