John Faulkner (NSW, Australian Labor Party, Cabinet Secretary) Share this | Hansard source

Yesterday, Senator Bushby asked me a question in relation to Tasmanian rail freight services. I seek the leave to incorporate further information in Hansard.

Leave granted.

The answer read as follows—

Senator Bushby—Tasmania: Rail Infrastructure—Further Information

The former Australian Government agreed to a rail rescue package in Tasmania during the course of 2006-07. As part of the package the Australian Government agreed to provide $78 million over a 10 year period to the Tasmanian Government.

Separately, the Tasmanian Government entered into a Memorandum of Understanding in August 2006 with Pacific National which established a number of commitments by Pacific National regarding its rail operations in Tasmania.

The key elements of the overall rescue package agreed to by the Australian Government entailed the following:

• Pacific National, which owned the Tasmanian track, passed ownership to the Tasmanian Government at no cost;
• The Tasmanian Government, as track owner, established an access regime with the ACCC. Under this access regime it is open to any company or group to run trains in Tasmania, not just Pacific National;
• Pacific National committed to providing a non-bulk rail freight service for 10 years unless certain trigger events occurred such as a fall in loads;
• The Australian Government committed to provide capital funding for upgrading the railway line at a cost of $78 million over 10 years.
• The Tasmanian Government committed to fund maintenance costs estimated at $4 million a year to ensure the line is kept in good repair; and
• Pacific National was to contribute at least $38 million, to be provided within three years, for rolling stock replacements and improvements.

The Australian Government is not a party to the MOU between the Tasmanian Government and Pacific National—our agreement is with the Tasmanian Government only who are responsible for the rail network in Tasmania.

To date the Australian Government has paid $16.871 million to the Tasmanian Government as part of the $78 million, 10 year rail rescue package. Payments commenced in 2007 with $1.582 million being provided in 2006-07. $15.289 million has been paid to date in 2007-08.

I understand this funding to date has been used to purchase rail sleepers which will be used by the Tasmanian Government as part of the upgrade of its lines.

The Government has sought confirmation from the Tasmanian Government that Pacific National has met its contractual arrangements with the Tasmanian Government.

The Australian Government is committed to increasing rail’s share of the national freight task and we have made a number of substantial commitments to rail in Tasmania.

Ultimately decisions related to services on the Tasmanian rail network are matters for the state government as track owner, and Pacific National, as the current service provider, to determine.

The Australian Government welcomes the statements made by Pacific National that it is working with the Tasmanian Government to ensure rail services continue while the sale process takes place.

The Australian Government will be having discussions with the Tasmanian Government about our current and future funding commitments and the legal and other implications of the announcement by Pacific National.