❓ The question challenges the Minister on prioritising the Perth Freight Link over rail freight and a new port in Kwinana. The Minister defends the project, citing increased rail freight efforts, the long timeframe for the Kwinana port, and financial benefits of the road project.
AnsweredQoN 412Legislative Assembly
QuestionView source ↗
PERTH
FREIGHT LINK — LAND ACQUISITION
412. Ms S.F. McGURK to the
Minister for Transport:
I have a
supplementary question. Would it not be better if the minister put his efforts
into putting more freight on existing rail and a new port in Kwinana —
Several members
interjected.
The SPEAKER : Thank you for that little history lesson,
member for Cockburn. We will take it up outside.
Ms S.F. McGURK : Would it not be better if the minister put
his efforts into putting more freight on existing rail and a new port in
Kwinana, rather than this ill-conceived road that will destroy homes?
FREIGHT LINK — LAND ACQUISITION
412. Ms S.F. McGURK to the
Minister for Transport:
I have a
supplementary question. Would it not be better if the minister put his efforts
into putting more freight on existing rail and a new port in Kwinana —
Several members
interjected.
The SPEAKER : Thank you for that little history lesson,
member for Cockburn. We will take it up outside.
Ms S.F. McGURK : Would it not be better if the minister put
his efforts into putting more freight on existing rail and a new port in
Kwinana, rather than this ill-conceived road that will destroy homes?
AnswerView source ↗
I thank the member
for that question, because there are some great points here. With regard to
putting more freight on rail, that is exactly what we are doing by increasing
the spur that is down in Fremantle; we announced that last year. We are
allowing for extra overtaking lanes so that we can increase the capacity on the
line. My office engaged with international providers like Watco, a world
recognised rail freight company and Watco asked, ''What is your goal
here?'' We said that we would like to increase freight by rail up to 30 per
cent. Watco indicated that if we achieved that, we would be world's
best practice, which indicates we could still expect a minimum of 70 per cent
of freight to move by road. Here we are faced with the need to deal with
growing freight movements in Perth. That is the issue with rail. The second
question was: why are we not proceeding with Kwinana? We have talked about that
in our longer term planning, but I can tell members that, on the advice I have,
it will take 10 to 15 years to get the Kwinana outer harbour moving and to be
able to deliver freight. If it is going to take 10 to 15 years, in that time we
will see freight movement double in Perth. If we were to do nothing but
proceed with the outer harbour, we would clog up Leach Highway, and people in
the electorates of the members for Willagee, Riverton and Bateman would see
their roads clogged up with freight movement. We have to deal with that now.
There is one final point. The opposition talked about this
being a waste of taxpayers' money. It is a $1.57 billion project. We
have received a $925 million offer from the federal government on the basis
that we establish a freight charge. I said we would only do that if we could
create a win–win for industry, and that is what we are working through.
The other thing the federal government wanted us to do was to raise finance
from a public–private partnership. The split was going to be $925 million
from the federal government, $415 million in equity from a public–private
partnership and a $235 million contribution from the state. When we started to
explore and understand that model, we found that there was a 62 per cent
discount on the private partnership from financiers because of the anticipated
leakage, and because of discounting for a new project. I felt that a 62 per cent
discount was far too great an amount of revenue to give away to a private
partnership. We have explored this, working with Treasury, and found that it is
far more acceptable to use global positioning system technology to deal with
leakage on our roads. If we deliver this and implement it well, we can reduce
this leakage, and cover not only the public–private partnership
funding, but also the state funding. If we do that, we can pay off this
infrastructure project in a nine-year period. It would take us 10 to 15 years
to deliver the port, and if we implement this project well, we can pay its cost
back in eight to nine years. This is a fantastic project for the state, and I
think it is exciting for the state.
for that question, because there are some great points here. With regard to
putting more freight on rail, that is exactly what we are doing by increasing
the spur that is down in Fremantle; we announced that last year. We are
allowing for extra overtaking lanes so that we can increase the capacity on the
line. My office engaged with international providers like Watco, a world
recognised rail freight company and Watco asked, ''What is your goal
here?'' We said that we would like to increase freight by rail up to 30 per
cent. Watco indicated that if we achieved that, we would be world's
best practice, which indicates we could still expect a minimum of 70 per cent
of freight to move by road. Here we are faced with the need to deal with
growing freight movements in Perth. That is the issue with rail. The second
question was: why are we not proceeding with Kwinana? We have talked about that
in our longer term planning, but I can tell members that, on the advice I have,
it will take 10 to 15 years to get the Kwinana outer harbour moving and to be
able to deliver freight. If it is going to take 10 to 15 years, in that time we
will see freight movement double in Perth. If we were to do nothing but
proceed with the outer harbour, we would clog up Leach Highway, and people in
the electorates of the members for Willagee, Riverton and Bateman would see
their roads clogged up with freight movement. We have to deal with that now.
There is one final point. The opposition talked about this
being a waste of taxpayers' money. It is a $1.57 billion project. We
have received a $925 million offer from the federal government on the basis
that we establish a freight charge. I said we would only do that if we could
create a win–win for industry, and that is what we are working through.
The other thing the federal government wanted us to do was to raise finance
from a public–private partnership. The split was going to be $925 million
from the federal government, $415 million in equity from a public–private
partnership and a $235 million contribution from the state. When we started to
explore and understand that model, we found that there was a 62 per cent
discount on the private partnership from financiers because of the anticipated
leakage, and because of discounting for a new project. I felt that a 62 per cent
discount was far too great an amount of revenue to give away to a private
partnership. We have explored this, working with Treasury, and found that it is
far more acceptable to use global positioning system technology to deal with
leakage on our roads. If we deliver this and implement it well, we can reduce
this leakage, and cover not only the public–private partnership
funding, but also the state funding. If we do that, we can pay off this
infrastructure project in a nine-year period. It would take us 10 to 15 years
to deliver the port, and if we implement this project well, we can pay its cost
back in eight to nine years. This is a fantastic project for the state, and I
think it is exciting for the state.
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