Victoria's Freight Minister Melissa Horne has told a parliamentary committee a government rail freight rebate scheme is no longer "fit for purpose" and is now obsolete.
Ms Horne told the parliamentary Public Accounts and Estimates committee hearing into the budget the Mode Shift Incentive Scheme, which is due to end in 12 month's time, had "done what it was intended to do."
The MSIS provides a rebate to four Victorian rail freight operators, which largely transport agricultural products, to encourage them to carry containers on rail instead of road.
They are Wimmera Container Line (SCT), Dooen; Linx, Tocumwal; Westvic, Warrnambool and Seaway, Merbein.
Gippsland South National MP Danny O'Brien told the committee in 2014 rail carried 14 per cent of freight into the Port of Melbourne.
That had dropped to 5.3pc by April this year.
"How have you not failed to actually increase the rail proportion going into the Port of Melbourne," Mr O'Brien said.
Ms Horne said the Victorian Auditor General's Office was conducting a review into the MSIS, but it would end in 12 months time.
Without pre-empting that review, "what we can see from advice from from Freight Victoria, and talking to people out there on the ground, it is no longer really fit for purpose," she said.
"This is an incentive scheme that has done what it was intended to do."
She said by the end of next financial year infrastructure would be in place to be able to provide "rail to port linkages."
Port rail shuttles were one of the reasons why the MSIS had become "obsolete," she told the committee.
That decision has been questioned by rail freight operators.
"There used to be 23 [rail freight] paths out of regional Victoria a week [into the Port of Melbourne], now it's up to 49," she said.
That was due to sustained investment in the regional rail freight network to ensure it was working to capacity and carrying longer, heavier trains.
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Mr O'Brien asked when the shuttles were likely to be "up and running", given the budget noted that a date was "to be confirmed.
"When will we have a port-rail shuttle," he said
"It's been on the books since you came to government and it's still not been delivered?"
Port rail shuttles will run out of intermodal hubs at Altona (SCT), Somerton (Austrak) and Dandenong South (Salta).
The government estimates tens of thousands of containers would be carried through the shuttles each year, freeing up 6000 truck movements a day.
But Mr O'Brien said it appeared no time-frame had been set, with budget papers saying the projects were subject to the commonwealth's Infrastructure Investment Review.
"Isn't this just hiding the fact you have had a blow-out in time and a blow-out in cost, because this project was already started, well and truly before the review began, and it specifically states the review does not affect projects already underway," he said.
Ms Horne said there were a number of factors around making sure the share of rail freight was increased.
That included providing a rail link to Swanson Dock.
"They [the port] has invested $125 million to be able to do that, which is about providing that linkage of rail down on the dock," she said.
Significant progress had been made on the shuttles, Ms Horne said.
"Altona will be up and running, very, very shortly, up at Somerton we've had an issue of land acquisition, which has subsequently been resolved, and Austrak is about ready to start work up there," she said.
Salta was finalising the design for Dandenong South and was working to engage a rail operator.
"This is a significant investment by the private sector, but, of course we are reliant on our industry partners to make this succeed," she said.
There were contractual requirements with Salta, Austrak and SCT.
"These have been entered into with the DoTP, they are being held to account and they are progressing," she said.
Andrew Miller
I'm a general reporter with Stock & Land, with a special interest in irrigation issues. I completed my cadetship, with the Age, in 1980. Over my career, I've worked for ABC radio news (Mt Isa, Qld) and at provincial and suburban newspapers.
I'm a general reporter with Stock & Land, with a special interest in irrigation issues. I completed my cadetship, with the Age, in 1980. Over my career, I've worked for ABC radio news (Mt Isa, Qld) and at provincial and suburban newspapers.
