Shipping Reforms Commence

Shipping Reforms Commence

The Federal Labor Government’s landmark shipping reforms came into effect on the 1st July 2012.

The tax reforms, including the establishment of the Australian International Shipping Register (AISR) are designed to promote investment in Australia’s involvement in international shipping. 99.9 per cent of Australia’s cargo trade is moved by ships, making it the 4th largest shipping task in the world and yet, Australia has only 4 international trading vessels.

The Government’s view is that a competitive and growing domestic shipping industry is in Australia’s long term national interest.

Companies which place vessels on the AISR will receive the government’s zero tax rate, the seafarer tax exemption (where companies do not have to pay employee income tax) and other fiscal incentives in the government’s shipping reform package, including:

  • provision for accelerated depreciation of vessels via a cap of 10 years to the effective life of those vessels;
  • rollover relief from income tax on the sale of a vessel; and
  • an exemption from royalty withholding tax for payments made for the lease of a shipping vessel.

In addition to reducing the cost of owning and operating an Australian ship, under the government’s shipping reforms AISR vessels on international voyages will pay international wages and conditions as set by the International Transport Federation. AISR vessels will be able to hire foreign seafarers; though the master and chief engineer have to be Australian.

With the Australian merchant shipping fleet having shrunk by half over the last 10 years, these tax arrangements are a major step towards ensuring that investment in Australian shipping will continue.

QTLC Freight Smart Grant Scheme

The QTLC together with Transport and Main Roads offered to 2 grants of $50,000 with the aim of encouraging and supporting Queensland based industries in identifying, trialling and evaluating innovative freight practices that will reduce urban congestion, minimise greenhouse gas emissions and deliver a more efficient and effective freight network.

The successful recipients of the Freight Smart Grant Scheme, Cannon Logistics and Strategix Training Group completed successful trials of their proposals and have presented their final reports to the QTLC.

Cannon Logistics trials tested Ice COLD Technology’s ability to deliver improved refrigeration efficiencies and fuel and carbon emission savings across the Australian refrigeration transport industry.  The trials aimed to deliver savings by restoring lost efficiency caused by oil fouling which occurs naturally in refrigeration.

The trials proved successful and were completed on trailers in an “In Yard” and “On Road” environment.  The average cost recovery period across both Continuous mode and Sentry Cycle mode is 7.46 months. 

Return on Investment (ROI) results were calculated on trailer loads that most closely reflected typical operating conditions and was based 10 years of life usage.

Strategix Training Group presented their final In2Green product to the QTLC’s CEO on 25 May 2012 and includes a:

  • In2 Green workbook
  • In2Green instruction DVD
  • IN2Green template CD

The program has ten easy steps to follow.  It enables users to plan their routes in a more efficient manner, to allow optimum vehicle utilisation, while reducing urban congestion. It outlines programs such as eco-driving and smart planning applied to vehicles, including trucks to demonstrate efficiencies gained by implementing these programs.  Eco drive trials have resulted in the reduction of fuel burn at an average of 22%.

Information relating to the Freight Smart Grant proposals will be available on the QTLC website.  

The next steps will be to promote the final products, the QTLC will work with Cannon Logistic and Strategix Training to ensure that the benefits are shared with the freight and transport industry.

New QLD Infrastructure Investment Unit

New QLD Infrastructure Investment Unit

A new standalone unit aimed at fostering investment partnerships that deliver positive infrastructure outcomes has been set up within the Queensland Department of Treasury and Trade, fulfilling a commitment made by the Queensland Government in its 100 Day Action Plan.

Treasurer Tim Nicholls last week said the new body, Projects Queensland, will focus on driving cooperative funding models that maximise private investment and ensure major projects are built on time and to budget.

According to the government, Projects Queensland’s key responsibilities will be:

  • Preparation, evaluation and management of public-private partnership projects;
  • Active engagement with the private sector to develop funding models to encourage private investment in infrastructure;
  • Preparation of business cases and contract negotiations for government financed infrastructure where the expected cost is greater than $100 million;
  • Acting in an advisory role assisting line agencies in the delivery of projects with an estimated capital cost below $100 million; and
  • Review and maintenance of the government’s key infrastructure policies.

The Treasurer and Cabinet approved the creation of Projects Queensland in early June.
Former Director General of the Department of Transport and Main Roads, Dave Stewart, has been appointed interim head of Projects Queensland. He will start work on July 16 for a period of up to six months.

The QTLC is meeting with senior representatives from the Trade and Investment  Queensland shortly and will seek to ascertain the role of Project Queensland in relation to critical freight transport and logistics infrastructure and the broader infrastructure planning and prioritisation process.

Kingsford Smith Drive Upgrade

Advice Provided to Lord Mayor Graham Quirk on Kingsford Smith Drive Upgrade

Thank you for providing the Queensland Transport and Logistics Council (QTLC) with the opportunity to review your plans for the proposed upgrade of Kingsford Smith Drive and for taking the time to walk me through the proposal at our recent meeting.

The QTLC is the peak body for the freight and logistics industry in Queensland; hence we are vitally concerned to ensure that freight movement, by whatever mode, is fully and properly considered in any planning context. We are also well aware that freight transport, particularly in Brisbane, is growing at a rate far exceeding that of population growth and, as such, represents an increasing proportion of the contribution to urban congestion.

Nevertheless, personal vehicles will continue to predominate as the root cause of congestion in Brisbane, particularly in the case of KSD as it represents the only viable route and means of transport for the many people finding employment within the growing Australia Trade Coast (ATC) precinct.

We are also aware that KSD represents one of the most highly trafficked freight routes under BCC control and provides an important link for freight consumers and generators nearby, including the CBD. The construction industry in particular is very reliant on KSD to afford timely access to project sites.

Whilst the phasing out of cargo shipping operations in the Hamilton Reach and the advent of alternative routes for freight will go some way to reducing heavy freight movements along the corridor, there will remain a significant number of businesses reliant on timely freight deliveries within the Hamilton area. As the process or urban renewal takes its inevitable course and commuter numbers continue to grow, it must be recognised that freight movements will also grow to satisfy local demand for basic essentials.

In terms of benefits to freight transport from the proposed upgrade of KSD, may I offer the following observations:

Increased public transport capacity

The QTLC, whilst being a strong advocate for the freight industry, appreciates the benefits that mass public transport options (both road and rail) can deliver in terms of relieving peak congestion. We also appreciate that putting more buses on an already congested route is likely to do little to increase patronage. Hence we are supportive of measures which will increase the viability of public transport options which will not impose on the freight existing capacity of KSD. This implies a need to upgrade KSD to accommodate bus capacity.

ATC

We, in South-east Queensland, are much the envy of our southern counterparts because we had the foresight to establish the ATC as a hub for industrial activity, including for freight and logistics capacity to serve the region. This vision is now being reflected in significant private sector investment both in the sea and airports as well as by industries which can capitalise on being in close proximity to these assets. KSD will continue to be a significant corridor in terms of freight movement to and from the ATC, given the proposed constraints on freight movement on the Airport Link Project and already implemented for Clem7.

Air Freight
Air freight, whilst not significant in terms of the volume of freight moving around SEQ, is nonetheless valuable and usually time sensitive. Although Brisbane airport is now proximate to a functioning Gateway Motorway there remains a need for this freight traffic to access parts of the City not well served by other corridors such as the Airport Link project.

The growing market for imported goods sourced over the internet is leading to significant growth in the number of light commercial vehicles accessing the road network and many of these trips have their origin and destination at the airport freight terminals.

Distribution Centres
There are a growing number of both importers and domestic freight generators which are logically siting their DCs in the ATC precinct, many of which can be best served from an upgraded KSD.

Whilst the eastern end of KSD, on which Council has already commenced much appreciated upgrades, is of key importance for the use of freight efficient vehicles and thus provides robust linkages to major arterial routes, KSD west of the Gateway Motorway is a vital link for light freight making its way to and from the region as a whole.

The QTLC’s abiding desire is that, whatever upgrade option is ultimately selected, it provides capacity for freight not afforded by circuitous alternatives or tolled options and those businesses adjacent to the corridor, of which there are many, can get access to the goods they need to support the ambitions of higher residential densities in the area.

Thank you again for offering the QTLC the opportunity to lend its support to this valuable and important project and please note that we are more than willing to provide further support in answer to specific issues should they arise.