Urgent cry to get 'woeful' rail freight network back on track

Our rail freight network badly needs investment to make it more weatherproof and capable of handling national freight expectations more efficiently, according to a landmark research project report.

It also badly needs wholesale regulatory reform by governments because services continue to be fragmented by different state standards and policies, and administered by six different regulators.

Even within states, rail corridors are managed by multiple operators so freight movements become fraught with booking complications and delays.

Notably, agricultural and regional freight has been hit hard, with increasing volumes now moved by road because rail has become too inefficient and slow.

Rail now carries only about a third of the grain leaving northern Victoria's Murray region and relatively modest volumes of wool, meat and horticultural produce, partly because track speeds can be routinely limited to 20 kilometres an hour for months at a time.

Two decades ago 90 per cent of the region's grain going to port went via rail.

The industry report highlighted a "significant and urgent" need for rail to play a greater role in handling and decarbonising Australia's fast growing freight task.

In fact, even if the big budget Inland Rail project between Brisbane and Melbourne was completed without further government cost cuts or delays, far more investment would be needed around the country to divert freight from an increasingly congested, unsafe and emissions-intensive road network.

Shifting just 10pc of road freight travelling between Australia's major capital cities to rail would save more than $700 million in social costs alone, according to the Rail Freight Productivity Review's Future of Freight report.

The review found rail's share of inter-capital freight in eastern mainland states currently totalled just 11pc, partly because rail services were 30pc to 40pc slower than road.

The report, compiled under the auspices of the independent National Transport Research Organisation, said a stronger focus on rail would foster economic growth, be more sustainable than road transport, and safer.

"Our national freight task is growing and we can't rely on roads alone," it said.

Former Deputy Prime Minister and National Transport Research Organisation board director, John Anderson, said many previous funding and management efficiency efforts aimed at boosting the national rail network's capacity were hamstrung by outdated regulatory systems, policies and workplace habits.

"Compared to road freight, rail is underperforming woefully and losing market share just about everywhere except on the Nullarbor," he said.

"Past governments have allocated serious money to encourage freight off our roads, but unlike the national highway network, rail freight services are still hampered by state differences, and safety, signalling and regulatory restrictions, which discourage their use and further investment.

"Rail has had its hands tied behind its back."

Key report recommendations included establishing a single national regulator to standardise rail freight requirements, cutting government red tape, plus other initiatives to improve rail reliability.

Its list of "reliability and resilience" priorities included developing key intermodal terminals to support the Inland Rail project, introducing automated train scheduling systems across the intermodal freight network and improving the rail network's capacity to cope with extreme weather events.

In late 2022 heavy rain closed the NSW line west and south of Parkes for almost 100 days after causing multiple washouts and $37m in freight diversion costs and repairs along 150 kilometres of track.

In Victoria, at the same time, rain caused a derailment and a week-long line closure near Inverleigh costing $16m.

In response to the report the rail industry has launched its own Future of Freight campaign to advocate how the sector could handle more of Australia's freight burden, if given the chance.

It would draw on the comprehensive research which involved input from peak industry bodies, the Australasian Railway Association and the Freight on Rail Group.

The research was also backed by the federal Department of Infrastructure, Transport and Regional Development.

Freight on Rail Group chairman and Aurizon managing director, Andrew Harding, said boosting rail freight on key interstate routes should be a priority for governments and the rail industry.

He noted how the pandemic illustrated the essential role of robust supply chains.

Aside from potential economic efficiency gains, he said rail freight was up to 16 times less carbon intensive than road freight.

However, the rail freight sector's big repair plans have clashed with the federal government's November decision to overhaul its $120b infrastructure spending pipeline.

It culled Commonwealth funding for 50 proposed road and rail projects, including funds destined for Inland Rail intermodal and inland port investment.

Canberra blamed about $33b in cost blowouts linked to worker shortages, supply chain constraints and high inflation, prompting it to divert $7b of its infrastructure spend to existing projects already underway.

Mr Anderson was particularly worried the vital Inland Rail project, already frustrated by cost blowouts, regulatory restraints and political sideswipes, would again fall victim of more delays, or simply be abandoned.

Worse, the huge taxpayer investment in a high quality north-south freight infrastructure pathway may be completed, then sit wasted because governments refused to make regulatory reforms and give appropriate network support.

"If we don't see some table thumping and an absolute commitment to reform from government ministers and others, Inland Rail will be a white elephant," he said.

"Business will certainly use a national rail network that works seamlessly and has effective intermodal ports and related service efficiencies supporting it.

"There are huge productivity and greenhouse reduction gains to be made in the freight sector if we make these common sense reforms.

"This is low hanging fruit to be seized."