Craig Kelly (Hughes, Liberal Party) Share this | Hansard source

I rise to speak on the Land Transport Infrastructure Amendment Bill 2014. In doing so I would firstly like to pick up on some of the comments made by the member for Grayndler and previous infrastructure minister under the previous government, Mr Albanese, in his contribution to this debate. In his speech he said that the government needs to invest wisely in infrastructure—and I could not agree more with that. He went on to say that:

… by its very nature, infrastructure planning and delivery is a long-term business requiring long lead times, careful planning …

That is exactly right. In his speech he also went on to talk about the Moorebank intermodal project:

Sydney's transport system is, of course, the Moorebank Intermodal project. It was initially opposed by the coalition, including the member for Hughes. The member for Hughes campaigned very strongly against it …

and I thank him for that compliment. He goes on to say that that was:

… a position which is now rejected by his party, who understand how important the Moorebank Intermodal project is for Sydney in taking trucks off the road and providing a productivity benefit.

This debate has become very partisan. I could easily attack the former minister for infrastructure for his promotion of the Moorebank intermodal project as a party-political issue, but I do not want to do that, because I believe he made the decision to promote the Moorebank intermodal facility in the right spirit. But he did so on flawed assumptions and a hugely mistaken plan. I say that not just as a member standing up for a project in his local area that is going to adversely affect his local area, which it will. I argue against the Moorebank intermodal project from a truly national perspective. To build such an intermodal transport facility at Moorebank, on the site of the old School of Military Engineering, would be a multi-billion-dollar mistake—not multi-million or multi-hundred-million-dollar—that this nation simply cannot afford.

I come to this debate with what I believe are good qualifications and background to argue the case against this. Before I came to this place I had for 30 years been involved in coordinating the transportation of goods around Sydney. I have driven trucks around Sydney to deliver goods. For many decades I have arranged the import and export of goods from and through Port Botany, and I have coordinated the movement of containers of Australian export goods across the USA and Canada. So I come to this issue not from looking down over Sydney Harbour from an ivory tower somewhere in Sydney and saying, 'That's in Sydney's west'. I come to it from a local perspective, a national perspective and an international perspective. Firstly, what is the problem that the Moorebank intermodal project is attempting to solve? Well, theoretically the problem is the congestion at Port Botany. But the congestion is not actually at the port itself. We have a third container terminal nearing completion at the moment, and we have no problems bringing ships into the port and unloading them, nor any problems with loading them from Port Botany. The problem is the congestion on the local road networks and how the increased projections in freight may not be able to cope with those local road networks.

However, when this has been looked at, it has been looked at under projections of what the growth in those container movements from Port Botany would be. And as with many projections, we see a bit of an up-pick in something over a period of time, and it is very easy to forecast that that growth will continue up and ever onwards. But we have seen that that is not happening. We have seen that the growth in the number of containers at Port Botany has come off the boil. So the panic that there was a couple of years ago—that we would have this eight per cent or 10 per cent year-on-year growth of container movement through Port Botany, and therefore there was some rush to deal with the issue—is simply not there. We have time to plan this. We have time to plan it and to make sure that we get it right. We cannot rush and then make multi-billion-dollar mistakes. And that is where I fear we are heading at the moment.

If the problem is congestion on the roads, and we are unable to move all of those containers from Port Botany throughout Sydney, what are the solutions? The first solution is that we could move a lot of that freight at night, out of peak hours. That does not happen at the moment because of penalty rates. I agree that if someone is working later hours and working at night they deserve to be paid at a higher rate. But at the moment our roads network is often empty at night, when we could be moving a lot of freight from our port. That is one possible solution.

Another solution is to upgrade the existing roads, and that is exactly what we are doing with the WestConnex project. In fact, it is quite possible that what we are doing on that WestConnex project will make the Moorebank intermodal completely redundant. Another option is to put in additional container terminals at Port Kembla or Newcastle. And of course the other option, which is behind the assumption of the Moorebank intermodal, is that we actually move freight from the port by rail.

Just quickly touching on the intermodal concept: when a ship arrives at Port Botany, the containers are unloaded and put on the deck, then they are taken from the deck and put on a stack, and from the stack they are either put on a truck to be transported to where they need to go or put on a train. This is where the first faulty assumption about the Moorebank intermodal comes. We often hear, and we heard it in the minister's speech, that the idea is to take freight off the road and put it on rail. This is a seductively simple statement, and a flawed assumption, because it does not look at the entire distribution chain—from the port to the warehouse to distribution, to the unpacking of those containers, and to those goods getting to the end user. You may be putting it on rail, but ultimately that container has to go on road to get to its destination. Then once those goods are unpacked from that container, unless they are consumed at that location, they need to be distributed further by rail. So, the whole concept is simply flawed from the start.

What intermodal actually does is add another link to the distribution chain. It adds time, and time is money, and it adds cost. To quote Michael Bell, Professor of Ports and Maritime Logistics at Sydney University: 'If you are just introducing another leg into the supply chain, so that you still have the truck leg at the end with the container, then you have the tricky business of trying to argue that you are actually going to make some savings.' And he is exactly right, because there is no other city anywhere in the world that anyone has been able to identify that actually has an intracity intermodal to distribute goods from their port.

Where the intermodal concept works is in places such as Los Angeles, where they have the port at Long Beach. There the containers arrive at Long Beach, then go on a train across to the central parts of the USA—to Denver and Dallas and beyond—and that makes sense because of the long freight journey. The same is true in Canada, where the containers are unloaded at the port of Vancouver, put on the train, and then railed all the way across the country to Calgary, Montreal and Toronto. That makes sense because of the distance.

So, there is a real question mark about whether intermodals can actually work on an intracity basis. This should set alarm bells ringing. There is a very important quote the House should be aware of, from a report on the New South Wales state infrastructure plan called First things first, state infrastructure strategy 2012-2032. It warns, and I would like to quote this exactly, that the short-haul freight market, which is the intermodal concept:

…is essentially unproven in Sydney. At present, most intermodal demand in Sydney is for longer-haul export freight, and there is significant capacity available at a number of existing intermodal sites.

It goes on:

Sydney Ports and Hutchison are currently developing a 300,000 TEU per annum intermodal facility at Enfield.

I understand that is due to open at any time. Enfield provides the test case for larger scale short-haul intermodal freight in Sydney, and the report warns, with a recommendation highlighted in a box:

Infrastructure NSW recommends that state public funding for additional intermodal terminal capacity in Sydney (including in relation to supporting infrastructure) be minimised until there is greater clarity on whether the short-haul rail freight market is viable.

The alarm bells should be ringing. This is not an economically proven concept, and we should not be putting billions of dollars of taxpayers funds into a concept that is not even proven, and may not even be commercially viable.

But, let us just assume that we should have intermodals in Sydney. Where should they go? Ideally, where should they be located? This is where we have a completely failed analysis so far. If you look at where the containers are currently going, there is a big block of containers around the Enfield area. There are currently 474,000 TEU movements out at Enfield, therefore an Enfield intermodal could possibly work, due to its proximity to the current market. There is also a big location up at Eastern Creek, where an intermodal has been proposed in the future. There is also a small block down at Minto, Campbelltown, and in the Ingleburn area, which is serviced by an intermodal at the moment. But if we look around Moorebank, or if we look around Liverpool and the Chipping Norton area, there is simply no current demand whatsoever there for intermodal freight. The market has rejected the Moorebank area as a location to distribute containers from, and yet here we are wanting to put billions of dollars into building an intermodal in a location that the market has rejected. The alarm bells should be ringing very loudly.

Secondly, if we look into the future at the decades to come, if we had a crystal ball, where would we say an intermodal should be located? Well, if we look at Sydney's planning, we have very large growth areas. We have a south-west growth sector, and we have a north-west growth sector. In that area we expect to have 500,000 people living. In fact, the area from Parramatta to Penrith, and Campbelltown to Richmond—that Western Sydney area—by 2030 will have a population of nearly 2,000,000 people. Bang smack in the middle of that area, in the planning, we have an area called the Broader Western Sydney Employment Area. That is the area where the future container growth will be. That is the ideal location. To set it up at Moorebank and then to have to transport it 20 kilometres further west is simply poor planning, but that is exactly what we are doing.

When I have raised these real concerns with certain people, saying that Moorebank is not an ideal location, the comments I have gotten back are that it is okay because Moorebank could be one of several intermodals that we need, so if it is not exactly right that is okay, because we will build other intermodals later. This is deeply flawed. To get the containers out to Sydney's west by rail, we have only one rail line, which is the Southern Sydney Freight Line. That rail line has a maximum capacity of about 1.9 million containers. So, if we build Moorebank intermodal, and we add on the Enfield intermodal with another 300,000 containers, plus the Minto intermodal, then there is simply no more capacity left on that freight line.

We in government who are planning infrastructure have one shot in the locker to get this right, and Moorebank is completely the wrong location for this. The other concern is that there has been no alternative economic analysis or cost-benefit analysis of alternative locations. Look at the planning and the thought that have gone into Sydney's second airport. How many locations have been looked at? Economic analysis has been done for Badgerys Creek as a site. This has not been done at Moorebank; Moorebank is the worst possible location. We would have to spend hundreds of millions of dollars, if not billions of dollars, upgrading the local roads.

I could go on all day, but one of the real concerns we have at Moorebank is what it could potentially do to Liverpool Hospital. This is our largest hospital in Australia and the largest hospital in the Southern Hemisphere; it is in the Liverpool CBD. Building that intermodal at Moorebank, with the 20,000 extra trucks a day that it will bring, will create all these rat runs through the Liverpool CBD. That would jeopardise effectiveness of ambulances and emergency services getting to Liverpool Hospital.

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