The Economics of Road Freight 22 November 2006 Stuart St Clair Chief Executive Australian Trucking Association

Australian Trucking Association Established in 1989 Peak representative body for trucking in Australia A federation of state and sector associations and major logistics companies All corporate members are multi-modal Our mission: “To unite and represent a professional and safe Australian trucking industry.”

Industry Creates National Wealth An essential industry. We contribute to wealth & improve national standard of living We represent around 3.4% of the GDP of Australia. Around $30 billion. Over 180,000 employees in the hire and reward business of transport & over 49,000 trucking operators. More than 250,000 people engaged in supporting industries Trucking industry of world standard

Trucking Pays Its Way Trucking more than pays its share in Australia Trucking pays $1.8b for road use towards allocated construction and maintenance costs of just $1.62b All Australian Transport Ministers, state and federal recently rejected National Transport Commission’s recommendations for net diesel excise and registration increases in 3rd Heavy Vehicle Charges Determination

Major Freight Task Major challenge for the trucking Industry. Government forecasts Australia’s road freight task to more then double from 2000 to 2020 Source: BTRE Report 112, 2006 Doing nothing will lead to increased road/rail congestion A major industry concern: safe and efficient infrastructure for road freight transport.

Road Freight Growth Current estimates show only 9-15% of non bulk freight is contestable between road and rail In Australia; about 810,000 kms of roads & about 44,000 kms of rail ATA supports a competitive rail industry, assisted independently of road which pays its own way We oppose increased taxes and charges on road freight operators to make rail more competitive

Council of Australian Governments (COAG) COAG, agreed last February to: Harmonise & reform rail and road regulation within five years Strengthen and coordinate transport planning/project investment appraisal processes Reduce current and projected urban transport congestion.

COAG COAG initiated Productivity Commission Inquiry into Road and Rail Infrastructure Pricing ATA’s Productivity Commission Submission:the further you drive, the more tax you pay, and the heavier the load the more tax you pay

Productivity Commission Draft findings The freight industry is big enough for everyone Rail needs to carry its share of the freight task Road transport is over-recovered

Productivity Gains Productivity improved with B-doubles = 30-40% increase Intermodal terminals important for logistics providers Higher Mass Limits Network (HML) In a country the length and breadth of Australia, HML network is: Essential for industry Uniformity among states is crucial

Productivity Gains Need for productive vehicles; B-Triples, quads axle groups

Conclusions Appreciate being invited today Many common fronts where road and rail freight industries can relate. There needs to be more opportunities to meet in a spirit of cooperation; relationships need to be fostered and grown

Australian Trucking Association Thank you