Government committed to driving coastal shipping reform

Media Release

MCC002/2015

06 October 2015

Assistant Minister to the Deputy Prime Minister Michael McCormack emphasised the Australian Government's plan to move ahead with coastal shipping reforms at the 2015 Australasian Marine Pilots Institute's Pilotage and Logistics Conference in Sydney today.

“The Government is committed to driving much needed reform to enhance the nation's maritime connections which are critical to advancing Australia's prosperity and economic growth,” Mr McCormack told the nearly 200 conference delegates.

“We rely on maritime transport for 95 per cent of our merchandise exports and the Government certainly understands how imperative reliable coastal shipping services are to Australian businesses.”

Legislation was introduced by the Deputy Prime Minister in June this year to address the key challenges and competition barriers that Labor's 2012 legislation created.

“Australia's current industry regulations fall well short of meeting our needs for competitive and efficient shipping. In the first two years of Labor's Coastal Trading Act there was a 63% decline in the carrying capacity of the Australian coastal trading fleet,” said Mr McCormack.

“The fleet of major Australian registered ships with coastal licences is in sharp decline, plummeting from 30 vessels in 2006–07 to just 15 in 2013–14. Between 2000 and 2012, the volume of freight across Australia actually grew by 57 per cent, while shipping's share of Australian freight actually fell from 27 per cent to under 17 per cent.

“With domestic freight growing exponentially, our shipping network must carry a larger share of the load—the case for reform is crystal clear.

“Industries relying on shipping say the Coastal Trading Act is a barrier to competition and market entry by foreign ships and has increased the price of coastal shipping services. This has hit Australian businesses hard with the extra costs for businesses using an Australian vessel costed at a unsustainable $5 million more than using a foreign vessel.”

The new legislation will incorporate built-in protections for Australian workers and safeguards for the wages and seafarers operating on ships in the Australia coasting trade. Australia's rigorous maritime safety and environmental laws will also continue to apply to all ships operating in Australian waters.

Currently the new legislation is before the Senate Rural and Regional Affairs and Transport Legislation Committee which is due to deliver its findings on 12 October.

“Australia needs to be firmly focused on growing our national productivity. The Government is committed to driving the reform needed to support the maritime transport industry and allow it to adapt and respond to current and future freight movements through and beyond our ports,” said Mr McCormack.