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Monday, 8 May 1989
Page: 2007


Senator MacGIBBON(6.15) —Anybody who has listened to the debate on the Transport and Communications Legislation Amendment Bill 1989, not only today but also on the earlier occasion, could not fail to understand the concern in the Senate at the parlous state of Australia's transport system during the six or seven years of total neglect of the Labor Government. I do not intend to go through this omnibus Bill in detail because most of the points have been more than competently and eloquently covered by my colleagues. Before moving on to one or two points, I should like to make a few general remarks about transport. Transport occupies a disproportionately important place in the Australian community and the Australian economy. We are a very large country with a low density population and we must have efficient transport. We do not have efficient transport despite the opportunities that exist through modern technology.

I now turn to our various modes of transport. Going back to what has been said by earlier speakers in this debate, I support what Senator Sanders said about our not having an efficient transport system. That is not to say that some parts of the Australian system are not world leaders, that they are not very efficient. But the aggregate position of transport in Australia is not good. As Senator Bjelke-Petersen was saying, the importance of that lies in that it has an impact on all the costs in the country. It affects the standard of living of everyone in the country because it increases the cost of living. Inefficient transport means higher transport costs. That means that people have to pay a little more or a great deal more than they should for everything they buy. It also means that the cost of production of everything in the country, which is of particular importance to the export trade, suffers penalties from the increased costs arising from inefficient transport. Inadequate transport flows right through the whole of the Australian economic picture.

In a way, it has got worse because, in the past 15 or 20 years, we have seen a great concentration of manufacturing and retailing resources in Australia. Small manufacturers in towns, particularly provincial towns, have gone out of business because they have been bought by a company in the capital city. Ultimately, the company in the capital city has been bought by a larger company in Sydney or Melbourne, so we have tended to get a concentration in the production of goods at fewer and fewer points, which means that the cost of distribution of goods throughout Australia has increased. Inevitably when that happens the transport component in the price of goods increases also.

Australia really lives round the coast. Apart from Alice Springs and Mount Isa there is nothing of any size in the centre. It is logical that Australia should have a good shipping trade. When they developed this country, our forebears had a very virile and efficient shipping service around the coast. There is still a place for that because a good deal of the goods that move round Australia are not time dependent. Time is not critical when they move from one point to another. It does not matter whether simple commodities, such as groceries, are sent overnight between capital cities by train or by semitrailer. It could well take a week to deliver a carton of cornflakes from Sydney to Lismore without affecting the quality. It is cheaper to move goods by sea provided the present technology is used. Historically that is the way this country developed. We need to go back only about 30 years to when Australia had a flourishing coastal trade. We had large bulk iron ore carriers, not as large as they are today, travelling from Yampi Sound to the steelworks on the east coast, and we had the colliers, and a great infrastructure of small coasters, 300 tonnes or even smaller, and a large number of ships of 500 to 1,500 tonnes trading between the river ports, particularly along the east coast. That trade disappeared because the State and Federal governments of the day failed to exercise, in the interests of the community, the authority that they had.

There are two reasons why the coastal shipping trade failed in Australia. First of all, it was the onslaught of the State-run railways, which were as grossly inefficient then as they are today. I know that in my own State of Queensland the Australasian United Steam Navigation Co. Ltd, Howard Smith Ltd and the Adelaide Steamship Co. Ltd, but particularly AUSN and Howard Smith which traded up and down the Queensland coast, were driven out of business by the Queensland railways coming in with subsidised contracts to move timber and general cargo up and down the coast at rates that were not profitable to the railways but certainly were grossly unprofitable for the shipping lines. As the shipping lines were private, had to pay a dividend and could not accumulate losses and maintain their trading position, they were gradually forced out and disappeared. Once the ships disappeared, the railways could set their own rates, having a monopoly on the trade, and they proceeded with even more inefficiency than they had proceeded with formerly. That is the sad state that we have today. We have no efficient State railways in this country.

The other factor which beat the coastal shipping trade was the wild, unreasonable practices followed by the Waterside Workers Federation of Australia on the one hand and the Seamen's Union of Australian on another. I am probably one of the very few people in this Parliament who have actually worked on the wharves in Australia, lumping cargo with a cargo hook in one hand and losing a lot of perspiration. I have worked as a deckhand and as a crew member on freighters. To annoy members of the Australian Labor Party I will say that I did both of those jobs without either a union ticket or being paid for it. I did it for the experience when I was a student. It gave me an insight into the gross inefficiencies which existed about 30 years ago on the Australian waterfront and which, sadly, are as much there today as they were in those times. The combination of the State railways and the union movement killed the shipping trade.

It is now time we went back and in the national interest re-established an efficient coastal shipping service. It can be done. With containerisation we can move around the coast a great number of goods and general cargoes which are not time dependent in delivery. With the modern technical control systems on ships, we could have crews as small as five on a 500-tonne freighter running around the coastal ports with containerised cargo without any difficulty at all. The whole of the Australian community would benefit from that.

We move a great deal of bulk freight-iron ore, coal and alumina-around the coast. In the last decade there has been some progress towards lower manning strengths. Manning strengths on ships have come down very considerably. With a bit of good will and care, those manning strengths can go lower still. I hope that they will, because we must do that to maintain efficient coal, iron and aluminium smelting industries in this country. It is in the scale below that, that is, in coastal shipping, that there are considerable advances to be made in the Australian transport scene.

The next big carrier in Australia is the State government railways. It is heartening to see that the New South Wales Liberal Government has made a major investigation into the inefficiencies in its service. I am a great believer in rail traffic because it costs less to move by rail than it does to move by road. Admittedly, rail lacks flexibility, but it is still a good way to move bulk cargoes and move them with speed. It amuses me that we talk about cost recovery, user pays and 100 per cent cost recovery for aviation, but this Government and its predecessors have been quite happy to live with the situation where we lose hundreds, if not thousands, of millions of dollars a year in Australia on the railways. The New South Wales Government, for example, loses hundreds of millions of dollars a day on the New South Wales rail system. The Queensland Government would lose a huge amount of money but for the extortionate levy it puts on its coal exporters where it has a captive market, a monopoly situation. If one were to take the coal industry out of Queensland, one would find that the Queensland rail system was losing at a rate every bit comparable to that of the New South Wales railways. There is no reason at all for this.

We need to rethink the whole of the railway structure. We certainly need a standard gauge railway net throughout the Australian mainland. I remember years ago talking to a former transport Minister when the Fraser Government was in power. He told me that some years previously he had approached the Queensland Government to convert the line from the border up to Townsville to a standard gauge track, instead of the 3 feet 6 inches track, which exists and is in bad shape. That is quite apart from the problem of having a 3 foot 6 inch gauge track. The Queensland government of the day-I am going back at least 15 years-just ridiculed him. It just did not want the money although the money was offered to it to do that. I would hope that those sorts of attitudes have passed now in State governments, because we must have a standard gauge system throughout the whole country.

With modern technology and modern manning practices, I do not see why the freight services by rail cannot be made to pay. If that can be done, again there is considerable benefit to the Australian community. We certainly need to take the long term view and to put Darwin in the railway net. This was something I was opposed to for years, but the logic of it is inexorable. We have to be able to reach what will be the gateway to the Pacific rim nations. We should have a standard gauge railway introduced in Queensland. We should have a link through Queensland to Darwin through the Townsville-Mount Isa line which serves the Mount Isa mine and is already in reasonably good shape. We should build a line between Alice Springs and Katherine, or wherever that line comes in. It is one of those areas where we have to take the long term view and look 50 years ahead as to where Australia will be. With the development that will take place inevitably in the Pacific rim countries and given the proximity of Darwin to those countries, we have to take a much more realistic view of Darwin's place in the nation.

The third part of the transport component is the road system. Every speaker on this side of the chamber has deplored the huge cutbacks in funding for the road system in Australia. It really is a terrible road system to have in the 1980s, coming into the 1990s. The air traffic controllers strike a couple of weeks ago meant that a group of my colleagues and I were driven from Canberra to Sydney in order to catch an aircraft because for some reason either Canberra Airport staff were on strike or the airport was closed. I was pleasantly surprised at the standard of the Hume Highway between Canberra and Sydney. But in the last recess week I drove down from Brisbane to Newcastle. It was the first time for about 25 years that I had travelled on the New England Highway. I was just appalled at the standard of that road. Most of it is a narrow, two-lane road with a bad surface. It goes through every town and hamlet between Newcastle and the Queensland border. It is in no sense at all a national highway. This is one of the main trunk routes of the country; route 1.

I am not at all impressed by the fact that members of the Labor Party get up and say that under their Government for the first time we have a continuous bitumen road right around Australia. That takes no recognition of the quality of that road. The road is absolutely inadequate. For the amount of money that the Government has collected in excise on fuel, one simply cannot justify the cost in lives that these poor roads are occasioning to the Australian people.

Sitting suspended from 6.30 to 8 p.m.


Senator MacGIBBON —Before the suspension of the sitting for dinner I was saying that the various avenues of transport in Australia-sea, rail, road and air-all had to be efficient because of the great national importance of their being so. I discussed some of the shortcomings of the present road system. I made the point that, despite the Government's huge collection of funds from excise each year-running into billions of dollars-the road system in Australia is totally inadequate for a modern society. One of my dreams for Australia is to see a Federal government that has as its objectives the improvement of the standard of living of the Australian people by improving the economic competitiveness of the business sector in Australia and, secondly, the promotion of a decent transport system and also, certainly, something in the way of science and technology in the education system. But we will never get that with a Labor government which is more interested in handing out money to welfare programs and jobs for its friends. Since this Government is coming to the end of its term, hopefully we will not have too long to wait before we have a Liberal government which pursues those goals to the great benefit of all the Australian people.

The point I would make about the road system is that the inadequacies in all our transport systems cost Australia a great deal of money. The inadequacy of the road system costs us money, but it also brings the very great penalty that it costs us lives. Thousands of people a year are killed on the roads in Australia because of bad engineering practices. My argument is that far more people are killed through the bad engineering of those roads than are killed through things like drunken driving and speeding-the two things that provide such a great source of revenue to the State police in the various States of Australia.

Finally, we have the air system. In Australia we have good airlines, but we have a system which is not good. I am not referring to the inadequacies of the timetables and the inappropriateness of that situation. I am referring to the huge cost of travel. I am one of the very few people on this side of Parliament who voted against the two-airline Bill when it was brought in in the early 1980s. I am referring to the Act under which we presently operate.


Senator Crichton-Browne —That is a bit unkind. I wasn't here.


Senator MacGIBBON —The honourable senator would have voted with the government of the day had he been here-unless I had had the time and the patience to enlighten and educate him. My objection to the two-airline Bill at the time-about seven or eight years ago-was based on the fact that it provided no commercial competition between the two major airlines. I might say in passing that it was the Bill that both Trans-Australia Airlines, as it was then, and particularly Sir Peter Abeles, the head of Ansett Airlines of Australia, wanted at the time. So let there be no mistake about that: they got the Act they wanted, just as Sir Peter Abeles got what he wanted with respect to airport leases when Senator Gareth Evans was the Minister for Transport before the Federal Airports Corporation (FAC) and the Civil Aviation Authority (CAA) were created. But that is another story for another time.

My objection to the two-airline Act is the fact that it did not provide any realistic commercial competition between the two major airlines, and I said at that time that the end point of that would be the fares in Australia, which were already high, would just go beyond the reach of the average person. That is true today in Australia. Ordinary Australians simply cannot afford to fly from Sydney to Cairns, from Sydney to Perth, or even from Brisbane to Sydney; the fare structure is just so high. I suspect that the great majority of travellers on Australian airlines are people who travel on a business account-people who have to travel in the legitimate pursuit of their business; otherwise they would find some other way.

The reason why air traffic in Australia is not efficient gets down to over-regulation on the part of the Government. We have too many restrictions. I am not calling for a completely dog-eat-dog or catch-as-catch-can society. There have to be some rules and regulations if we are to maintain safety. But one of the great determinants of safety in the airlines is profitability. Provided airlines can operate profitably, they are prepared to spend the money on the maintenance, do the right things and not cut corners. Although some degree of regulation is always required in aviation, we have far too much regulation in Australia for the whole of the aviation industry, and the great majority of that legislation is totally counter-productive for the interests of the community.

Of course, the other problem we have is the union movement. It is not quite as bad and quite as blatant as it is on the waterfront, but we can look at the great unrest among air traffic controllers in Sydney at present and the airline pilots, with their eternal cry for more money-although they have more than kept pace despite the wage restraint of the last few years. I have noted a number of stories circulating through Australia at present to the effect that the airline pilots are ready to go on a major strike in June and bring the country to its knees. I hope they are not true, because the airline pilots have a responsibility to provide an essential service, and I hope they use the normal processes of negotiation. But it is the effects of over-regulation and excessive unionism that have contributed to the high cost of aviation in Australia. And aviation-along with road, rail and sea-has an essential part to play in the Australian economy, so it is in our interests that they are all efficient.

One of the great blows that the aviation industry has suffered has been the imposition of the Federal Airports Corporation and the Civil Aviation Authority on it by this Government. If we look at the whole of the infrastructure of Australian society with respect to transport we find that, in the six or seven years we have suffered and endured this Labor Government, it has collected tens of billions of dollars, if not hundreds of billions of dollars, in excise and taxes, and it has put very little of it back into the transport system as a whole. Certainly in the aviation field, despite the fact that the Government recovered outgoings to the extent of 108 per cent in the last year before the FAC and the CAA were introduced, very little of it went back into running the system-into building the radar systems and making the necessary improvements to the airports. The Government just socked it off into Consolidated Revenue and spent it on its pet welfare schemes, soft living and things like that that contributed nothing to the economic growth of Australia.

The creation of the CAA and the FAC has produced an enormous reaction in the Australian aviation industry. It was for that reason-I do not wish to canvass what might be the findings of the Senate Committee-that the Senate last year, at the behest of a motion of mine, agreed to set up an inquiry into both the organisation and the management of those bodies. Sadly, having started on that inquiry, one has to say that both of these authorities-the Federal Airports Corporation and the CAA-are not managing very well. The Civil Aviation Authority, as the descendant of the old Department of Aviation, at least has some glimmer of understanding of what the aviation community is about, even if it has a limited understanding of the realities of the commercial world. The Federal Airports Corporation, in contradiction, has no understanding-not even the faintest glimmer of understanding-of what the aviation industry is about, and it has a parallel ignorance about the commercial world.

Both of these bodies are trying to gouge hundreds of millions of dollars out of a very small tax base. The levels of charges by both authorities have increased enormously in the year or so that they have been in operation. For example, rentals to the FAC have commonly gone up by 500, 600 or even 800 per cent-which, even given the fact that we have rampant inflation under Labor, is hardly a fair thing for the limited base that is trying to support it. These bodies really cannot see that they are driving the aviation industry in this country, particularly the general aviation industry, out of existence. But it is not my purpose tonight to debate the shortcomings of those two authorities except to use them as an illustration of the way the Labor Party has failed to manage an essential component of the transport industry in Australia.

The Opposition will be moving an amendment that extends the time of payment from 28 to 45 days. The industry standard is between 60 and 90 days. We think it most unreasonable that draconian powers should be given to the aviation authorities to sue for payment after 28 days. The authorities are extraordinarily inefficient. By way of example I cite the case of an account for a sum of about $13.20 owing to the FAC. In the pile of papers I have before me there are 11 statements. The bill has been paid. A letter was written to the Federal Airports Corporation by the person concerned, who was billed about five months ago. That letter was never acknowledged. The letter pointed out that payment had been made, but accounts kept being sent out every month. As I said, the sum involved is $13.20. The short payment is alleged to be $6.60. It was paid when the account was originally presented. But the FAC's accounting system is so poor that it keeps sending out those accounts, each of which, the Federal Airports Corporation admitted to a Senate committee at the start of this week, costs about $30 to $35 to produce. So incompetence in detecting what went wrong over a $6 bill has probably cost the FAC a couple of hundred dollars in accounts which it has mindlessly sent to the person who has written explaining that the bill has already been paid.

The Government is asking us to allow the period for payment under law to be 28 days instead of the industry standard of, as I said, between 60 and 90 days. The Federal Airports Corporation and the Civil Aviation Authority will be able to take a lien on the aircraft owned by the people. It is absolutely absurd to allow them the right to take a lien against an aircraft that certainly would cost at least tens of thousands and maybe hundreds of thousands of dollars, or millions of dollars in the case of corporate aircraft covered by the Business Aircraft Association, when their own accountancy practices are so bad. One only has to talk to people in the aviation industry to realise how widespread slipshod accounting practices are, quite apart from the argument as to whether these rapacious charges to be imposed are justified. It is just not tenable to reduce this payment period to 28 days. No-one in this country now pays his bills in 28 days. So the Opposition will be moving an amendment to the Bill in the committee stage which extends the payment period to a more realistic 45 days.