Australian port sale impact inquiry begins

Port of Newcastle The Port of Newcastle wants to diversify from its coal-based income, but the New South Wales government has been accused of resisting this. Credit: Port of Newcastle

The New South Wales (NSW) Legislative Council's Public Works Committee has commenced an inquiry into the impact of Port of Newcastle sale arrangements on public works expenditure in New South Wales.

In 2014, the Port of Newcastle, the world’s biggest coal port, was sold by the state of New South Wales to a consortium, now made up of The Infrastructure Fund and China Merchants Group, in a deal worth $1.75bn. However, diversification plans were hampered in 2016, when it was revealed that Port Botany and Port Kembla were protected by the NSW Government from container competition after privatisation with a secret fee on any Newcastle container development to be passed to the ports.

The Hon Robert Brown MLC of the Shooters, Fishers and Farmers Party, committee chair, stated: “The committee will be looking into the extent that current limitations on container port operations contribute to increased pressure on transport and freight infrastructure in New South Wales.

“The nature and status of the port commitment deeds will also be examined, as well as to what extent container port limitations contribute to additional costs for industries who are importing or exporting from New South Wales.”

Detailed analysis

The ATN said that pressure for transport and freight infrastructure will be examined with specific focus on the Westconnex Gateway project; the Port Botany Rail Line duplication; intermodal terminals and rail road connections in southwest and western Sydney; and other additional public road infrastructure requirements due to the additional road freight movements in Sydney under the existing port strategy.

The Port of Newcastle container plan would enable enables container transportation trucks to be replaced by trains in NSW, but this would also replace Port Botany trucks with trains and further track development would also link Port Kemla.

The inquiry will also consider the nature and status of the port commitment deeds, the extent to which they contain limitations on container port movements and the terms and binding nature of any such commitments.

An additional consideration will be the extent to which container port limitations contribute to additional costs for NSW industries who are importing or exporting from New South Wales, especially in the Port of Newcastle catchment.

Mr Brown confirmed the committee will hold one public hearing in January and will table its report by the end of February. The committee is currently accepting submissions with a closing date of 6 January 2019.

The Australian Competition and Consumer Commission is already looking at looking into whether the constraints on Newcastle contravened federal competition laws, with a report due to be completed by the end of 2018.

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