Additional Comments from Coalition Senators

1.1Liberal Senators on the Committee thank the witnesses and submitters who contributed to the inquiry, particularly the Tasmanian businesses and industry groups who gave up their time to highlight the inefficiencies and shortcomings in the TFES as it is currently operating.

1.2It is clear from the evidence received during the inquiry that the TFES is not currently meeting the needs of Tasmanian businesses needing to transport products and supplies over Bass Strait and to the Bass Strait islands.

1.3The coalition has a strong and recognised history of implementing positive enhancements to the Tasmanian Freight Equalisation Scheme since its inception.

1.4As the report highlights, the increasing costs of shipping across Bass Strait have been highlighted as a major concern for Tasmanian businesses and industry over recent years.

1.5It is not acceptable for Tasmanian businesses to be disadvantaged because the support provided by the TFES is falling behind the necessary levels of support.

1.6It is clear from the evidence that the scheme needs to be realigned back to its original design principals and given the current high inflation environment of the last three years, that realignment is urgent and the sequence of scheme reviews should be more frequent.

1.7The following graph from the Bureau of Infrastructure and Transport Research Economics’ Tasmanian Freight Equalisation Scheme Monitoring Report 2024[1] demonstrates sharp surge in underpayment in last three years:

1.8The government should move quickly to return the TFES to its original design principals of balance in the class systems including commensurate adjustment of the rates of goods for import, export and the Bass Strait islands.

1.9Given the current high inflation environment the government should reduce the review time period to two years and include scope for the continuation of realignment of the class system and consequent rate adjustments.

[2]

1.10Evidence from submitters demonstrated the extent to which the intermodal costs have fallen behind due to lack of change over the last 20 years and the indexation by CPI over that period would see the intermodal rate increase proportionately to real costs.[3]

1.11The government should act on this evidence.

1.12Tasmanian producers and businesses are responsible for some of the finest foods and products. The ability to get these products to markets around Australia and the world is critical to sustaining and growing jobs in Tasmania and underpinning investment in key industries.

1.13Liberal Senators on the committee support the work done by the inquiry and are convinced that the outcome must be urgent modernisation of the TFES to meet the current and future requirements of Tasmanian business and industry.

Footnotes

[1]Bureau of Infrastructure and Transport Research Economics, Tasmanian Freight Equalisation Scheme: Monitoring Review (Consultation Draft),2024.

[2]See Appendix 3 of the committee’s report.

[3]See, for example, Norske Skog Boyer Mill, Submission 9; Mr Patrick Dooley, General Manager, Norske Skog Boyer Mill, Proof Committee Hansard, 13November 2024, pp.32—39.