RAIL FREIGHT

Mr HAMILTON-SMITH (Waite) (12:24): I move:

That this House—

(a) notes the Federal Government's Discussion Paper entitled Adelaide Rail Freight Movement Study, dated October 2009;

(b) commends the City of Mitcham Council and members of the Rail Freight Sub-Committee for their efforts in seeking action on rail freight infrastructure reform;

(c) calls on the Federal and State Governments to advance the Discussion Paper to a plan of action to re-route rail freight traffic from the City of Adelaide through a northern by-pass south of Truro; and

(d) notes that a rail freight by-pass should also provide a corridor for road freight transport to by-pass metropolitan Adelaide.

When I gave notice of this motion in the house on 22 June 2010, the Adelaide Rail Freight Movement Study had not been released. Finally, on 24 June 2010, the federal Minister for Infrastructure and Transport, Anthony Albanese, released that long awaited study. This is a very important issue for all South Australians, but particularly for all who live astride the line from Murray Bridge through to Adelaide, which carries an enormous amount of freight.

It took federal Labor three long years to deliver the study. They finally rushed it out on the day Julia Gillard rolled Kevin Rudd for prime minister in an attempt, I believe, to hide it from public scrutiny. This is no surprise when you look at the findings of the study. It contains little evidence and data to support its findings and the cost of the report has been extraordinary. It comprises 45 pages. If the entire $3 million was spent producing it, it has cost the taxpayers almost $67,000 per page. It is another example, at this point, of Gillard Labor government waste, because the report needs reworking. In particular, economic modelling for the social benefits of a bypass in relation to option 3 is confused and lacking in detail.

The study in its current form is a failure. This is largely due to the terms of reference the consultants were given. My constituents in Waite—and constituents in other electorates—need to know whether the full $3 million was provided to consultants GHD for this work, or was the budget cut? Because the final study is a poor outcome. The study recommends that nothing be done. Each option identified is dismissed as not being cost effective.

Let us consider the nature of the problem. There are freight problems along this route. As noted by the Adelaide Freight Movement Discussion Paper, and then the study, the freight line runs parallel to a passenger line; the line is characterised by steep grades and tight curves which prevent double stacking of containers; freight trains have to travel more slowly than on other lines; freight trains use 50 per cent more power than on other lines; and freight trains are restricted to a maximum of 3,500 tonnes.

Then there are safety issues: derailments, the potential for bushfires caused by poorly maintained undergrowth along the track, and level crossing interactions with road traffic. Then there is the noise issue: noise pollution is causing great discomfort, inconvenience and disruption to local residents all the way along the line throughout the day and night, with wheel squeal being a particular problem.

Let us go over what has been done, or not done, about this problem. It is a long-term problem, with no short-term solution, especially given the dire state of federal finances thanks to the Rudd and Gillard Labor government's fiscal mismanagement and wild spending sprees. At the last election federal Labor was forced to commit to a $3 million study. Two years later, in October 2009, a discussion paper was finally released. Almost three years later, federal Labor rushed out the results of the discussion paper, the Adelaide Rail Freight Movement Study, as I mentioned, on the day that the prime minister was toppled.

In amongst this activity, and in recognition of the serious nature of the problem, Mitcham council established its own Rail Freight Committee. I commend the Mitcham council and the Rail Freight Committee for their significant efforts on the issue, one result of which has been that 65 of 68 South Australian local councils have now agreed that a northern bypass should be built. Local councils of the City of Unley, the City of Mitcham, The Rural City of Murray Bridge, along with Regional Development Australia Barossa and Regional Development Australia Murraylands and Riverland also committed their own funding to prepare a strategic assessment of corridor options, which agrees with the state Liberals' assessment that the cost benefit analysis of social aspects of this matter has been sadly lacking.

I commend the councils for all of their efforts on behalf of my constituents and the broader community affected by this issue. I further note that the City of Mitcham will be holding a public forum on this issue on 30 July 2010. Stakeholders, I am sure, will make sure that this issue does not go away. It would be pertinent at this time for those opposite to state their position on the matter. The Minister for Transport was reported in The Advertiser on 3 July 2010 as stating:

...while the state government would not rule out support for a long-term solution, it was up to the federal government to undertake a new study.

If that is tacit support for the federal government to go back to the drawing board and get the study right, then I agree with the minister, but is this the best the Rann Labor government can do?

Let us look more closely at the study. It was to look at the forecast freight volumes and task, and the ability of the existing rail line to meet future demand having regard to economic, environmental and social factors. In particular, the study was required to specifically consider the feasibility of a new alignment (proposed by Mitcham council rail freight committee) that would run to the north of Adelaide.

I now want to talk about this option, known as option 3. This option is supported by the majority of stakeholders and came with a preliminary costing of $1.4 billion in the discussion paper, a figure that rose to $2.4 billion in the final study. The reason for this increase in cost is poorly explained in the study. Option 3 involves making the ascent of the Mount Lofty Ranges around Truro, requiring extensive bridge and cutting work. In addition, improvements would be required to the short tunnel and the bridge at Murray Bridge.

The budget allows for the bypass to be developed to a standard capable of handling 1,800-metre long, double-stacked container trains. The option would provide enough capacity to meet the rail freight demand through to 2039. Track operating costs for this option are relatively low, and it would reduce transit time and costs for rail freight between Melbourne and Perth. However, it is described as a less effective option for freight to and from Adelaide without, in my view, sufficient evidence.

As the study notes, although the option allows the use of more efficient trains than can currently be accommodated, the route taken by these trains operating to and from Adelaide would be indirect. Under this option, freight traffic on the existing route would cease. This would provide a full resolution of the community amenity issues associated with operations currently on the Adelaide Hills route, as the northern bypass would travel through currently sparsely populated country and pose relatively few new social issues. Preliminary assessment suggests that there are two heritage sites along the route within 100 metres of the alignment that could be affected. However, it is possible that more detailed investigations will reveal refinements to this alignment which would allow these sites to be avoided.

The findings of the study showed that, based on freight demand forecasts, including ARTC's estimates, and in light of the committed works on the corridor, capacity is not likely to be a constraining factor until between 2025 and 2030. The current alignment can handle 10.7 million tonnes of freight per year, which is more than double the 4.8 million tonnes per year that is currently carried on the rail line.

But this is the important point, because on page 13 of the study it is noted that, in the high case scenario, which is a very real prospect, traffic on this freight route is likely to increase 4.6 times by 2039. That is almost five times more freight traffic than we are seeing on the Belair line today. This is an increase of freight tonnage from 4.8 million tonnes, not to the 10.7 million tonnes mentioned earlier but to 22.2 million tonnes by 2039, five times the current rate. This represents an annual average growth of 5 per cent over the 30-year evaluation period. This is what lies ahead.

The study dismisses option 3, the northern bypass, claiming that the net social benefits are minimal. As the study notes, this outcome is largely explained by the way in which this benefit cost analysis quantifies externalities. The unit values used to calculate externality benefits are distance rather than intensity-based values (that is, dollars per train kilometre travelled).

This means that the magnitude of noise benefit is a function of alignment length as opposed to severity of impost on local residents. This was in the terms of reference. Given the northern bypass is approximately 90 kilometres longer than the existing alignment, calculated externality costs (the study argues) will be higher in the northern bypass option than in the status quo.

By adopting a distance-based approach to quantifying noise externalities, it effectively assumes that the intensity and the cost of noise impact per train movement along the northern bypass route is the same as that experienced along the existing route. This is a complete flaw in the study. Had it applied intensity-based values, noise-based values or social dislocation-based values the whole methodology would change.

The study asks us to believe that the noise and inconvenience to people when a train passes through an open expanse of paddock on the way to Truro is the same as a train running past the homes of residents in Blackwood, Belair, Mitcham, Unley or Adelaide. Imagine that! This study is fundamentally flawed and the economic modelling is also flawed.

The work must be redone. The community knows that. That is why 65 of 68 South Australian local councils recently voted to support a northern bypass (option 3). I know constituents in my electorate are deeply affected by the issue and they want to see it resolved. The state Liberal Party has a position of supporting option 3 of the study, and has held this position for some time.

The state Liberals acknowledge that there is no short-term solution here. There may not even be medium-term solutions to this issue, given the now dire state of federal finances, thanks to the Rudd and Gillard Labor governments' spending spree on acknowledged failures such as home insulation and school halls. In the long term there must be an answer. It is not good enough for federal Labor to flick off the study to Infrastructure Australia and the Rann Labor government for inclusion in other studies and plans. This is simply code for doing nothing.

There must be action on the issue. No-one expects a short-term fix. There is no money for a short-term fix. Labor has squandered it, but we need to look at the medium to long term. First, we need to get this study right. We need to get the economic modelling right. We need to know how much was spent on the study.

I am advised that the amount spent on the study may have been underspent by as much as 50 per cent. If that is correct—and I am calling on the federal minister to indicate exactly how much has been spent—the money may already be there to go back to the drawing board and to get the study right at no additional cost. We need the social benefits of option 3 to be properly examined.

Finally, a plan of action must be formulated, even if it is a long-term plan beyond the current budget estimates. In recommending a plan of action I recognise that there is no short-term solution, given the dire state of federal finances. In recommending that the true cost of the study be revealed, a better and more comprehensive cost/benefit analysis be conducted and a plan of action be formulated, I want to know whether those opposite will support us. Will the Minister for Transport and the Rann Labor government start to take this matter seriously for the people of South Australia? They need some long-term infrastructure planning and a bypass in the long term needs to be part of that plan.

Mr GRIFFITHS (Goyder) (12:39): I rise today to support the member for Waite's motion. I recognise the importance he places upon it and the importance that the people of the cities of Mitcham, Unley and Murray Bridge, the District Council of Mallala, the Adelaide Hills Council and regional development board structures around those areas also place upon it.

There is absolutely no doubt in my mind, after reviewing this discussion paper and discussing this matter with the member for Waite, that it is critical that the state government recognises the importance of this report and, importantly, the fact that the report is incomplete in many areas and that additional pressure needs to be placed upon the federal government to ensure that a report is prepared that identifies options that will translate into a project that will occur.

I have great frustration, as does the member for Waite, in being told that, basically, 'Yes, this is a $3 million report.' It is some 46 pages in length, but it makes no firm recommendation on how to proceed because the option of not proceeding is not an option. It is very obvious to me that a line with the capacity of 10.7 million tonnes—which is currently used to some 4.8 million tonnes, but the projections over the 30-year period use a base case, a low case or a high case of freight that will travel on that line—clearly indicates that using the low case of 14.3 tonnes per year or the high case of 22.2 tonnes per year of freight travelling on that line (which will reflect upon the economic growth in our state) means that it is very critical that this investment takes place.

The people who live in the hills have lived with this rail line for many years, there is no doubt about that. Many of those people have been rather placid, I think, in their level of frustration, but the community is now coming to a position where it sees the need for investment to take place. I note that, in a recent Local Government Association vote on this, 65 of the 68 councils supported option three occurring which takes in the northern bypass, because they want to see investment happen in our state.

It is frustrating to me that an alternative option proposed in some other areas for an investment to occur, namely, the Barkandji option of some $300 million, will take investment out of South Australia and take it due north towards Mildura, which, I think, runs the risk of consigning South Australia's rail hub future to a much poorer one than it should be.

It is critical for the infrastructure needs of this state and for the economic opportunities that exist that this report be done properly, that it takes into account the economic, environmental and social impacts of the communities of the Adelaide Hills and the people in the surrounding areas who deal with this issue every day and that we make sure that the investment occurs.

It is a long-term solution; I do recognise that. Capacity exists within the line for the freight increases projected for the next few years, but if we look at the fact that we want South Australia to grow economically, that we want South Australia to become a transport hub given its central location in relation to Australia, it is important that we look at investment opportunities, and this is absolutely one of the key ones.

The member for Waite has referred quite often to financial contributions that the federal government has made to other projects around Australia. All within the nation have read the continuous media examples of poor investments being made, or cost overruns being incurred. Yes, this project comes at a tremendous cost option (my understanding is that option three is some $1.4 billion), but it is important that governments of all persuasions plan for it, and it is important that this state government gets behind it and offers its support to a review of this study to ensure that we get the outcomes that we need.

Rail freight will be increasingly important. I know that, in my meetings with freight operators, I am constantly told that transport will double over the next 10 or 15 years. We all hope that our population increases, that our produce from our state increases, that we get more export opportunities and that revenue comes into our state. It is important that we have a rail freight opportunity to get those products out—and, indeed, bring products in—as we allow our economy to expand.

Rail will be one of the key players. Road investment, obviously, is going to occur, too, but rail will be one of those key players. A government that is focused on opportunities for the future, that has a report which talks about potential growth over the next 30 years and that sees that that growth is more than twice the capacity that sits within the current rail network will recognise the opportunity that this presents. It will push as strong as possible the case for an investment to occur, and it will ensure that that actually happens.

I know that members on this side of the chamber are committed to this. We have held this belief for some months. We welcome the fact that $3 million was provided several years ago for the review to be undertaken and for the study to be prepared, but unless you are actually committed to it that money will be wasted.

Let us ensure that we go back to the drawing board, that we use this data provided as part of this report for the base of it, that we revise the social and environmental impacts that the member for Waite has so well and truly put to the chamber and that we look at the economic opportunities.

I am a person with figures in my head a lot, but this is a real obvious one to me. Tremendous community benefit will occur. It will create opportunities in the Adelaide Hills, it will open up and guarantee South Australia's rail hub future and it will ensure that this state has a chance to move forward. I urge members on both sides of the chamber to support this motion.

The Hon. I.F. EVANS (Davenport) (12:44): I will not hold the house long. I rise to support the motion moved by the member for Waite and the comments of the member for Goyder. The house will be aware that I have raised this issue since 2004 and have been calling on the federal government to make moves to move the freight line from its existing route to northern Adelaide. I was pleased that, at the last election, the two major parties gave a commitment to spend $3 million on a study, as the member for Waite outlined. We are now debating that particular study.

I will not repeat everything the members for Waite and Goyder said, other than to say that the report is lacking in a lot of detail. It did not really take into account a lot of the benefits that would flow to South Australia and the suburbs as a result of moving the freight line. By freeing up all the intersections from Belair to Adelaide along the railway line, there is a huge saving to the state and to the taxpayer in infrastructure projects not having to proceed. The issue in Blackwood is that, if the freight train is taken out to the north of Adelaide, then the existing freight route can be used to create a bypass route around Blackwood, because the land corridor is there. So the passenger train would stay, but a bypass road could be built around Blackwood. Blackwood main street could then be rebuilt like the Norwood Parade or the Stirling main street, and dressed up to be a more attractive place to visit. I know the local business networks certainly support that concept.

They did not cost any of these social issues into the study, as the member for Waite quite rightly points out. The other issue they did not take into account is that, if you move the freight line to the north, which is the line which the Melbourne Express runs on, you could then run the Melbourne Express into the Barossa and have Adelaide to the Barossa overnight, the Barossa to Melbourne, or Melbourne to the Barossa overnight and then into Adelaide. It opens up that whole tourism link into the Barossa Valley, and again that has not been costed into the exercise and neither has the aspect of then running the passenger line to meet the Melbourne Express, which would provide a passenger service from the Barossa through the northern suburbs.

I congratulate the member for Waite on bringing the motion to the house. I congratulate the local residents who have worked long and hard since 2004 on this issue. I think we should understand what happens if we do not move the freight line. The Labor government's plan is to do up the existing route so that it can take longer and larger trains from Melbourne through to Adelaide. Very simply, longer and larger trains mean more traffic congestion and more noise.

I point the following out to the house and I invite anyone in the house to join me. My residents do not complain greatly about the engine noise. It is not the engine noise that is the issue in my electorate so much. The issue is the high-pitched squeal of the steel wheels grinding on the steel rail. There are distinct two noises: the base of the wheel on the top of the steel rail and the flange of the wheel on the side of the two rails. When I was minister for the environment we moved legislation to license the trains and the train track so the EPA could try to deal with the issue. That has not been as successful as everyone would have hoped, but that was a world first in that sense.

The EPA, with the ARTC, introduced sound-measuring technology. It identified which axle squealed and then it would email the owner of that axle and they would have a maintenance regime on that axle to try to address the problem. The ARTC spent over $2 million, from memory, developing that particular technology. The industry has been genuine in trying to deal with this issue. I invite any one of you to come to Blackwood to listen to the squeal and to tell yourself that that is acceptable. No-one in the district is saying that the engine noise is the issue. The squeal is the real issue and the ongoing traffic congestion.

The Labor Party signed off on the Blackwood Park development before losing the 1993 election. There is a 20 per cent increase in Blackwood's population. Blackwood Park only has two exits in case of fire. Traffic congestion in Blackwood as a result of the Blackwood Park development and the Flagstaff Pines development is significant. The residents are very concerned that in time of fire, with the freight train coming through at the wrong time, there is going to be a real issue of evacuation and traffic movement in those times.

So, I agree with the member for Waite and the member for Goyder. The federal government report is lacking, and I am hoping that during this election process there might be some more progress made in the federal election in relation to this issue. Again, I congratulate the member on moving the motion.

The SPEAKER: Member for Schubert, I am sure you have something to say on this matter—anything to do with trains.

Mr VENNING (Schubert) (12:50): You amaze me, Madam Speaker. Your perception, again, is impeccable. This issue has been raised over many years. This is not a new concept. In fact, it was first raised with me when I was a member here in 1995-96 by a person under the name of Mr Ron Bannon—no relation to the former premier. Mr Bannon used to operate a Barossa passenger train service. It was an entrepreneurial service; I think he used to use red hens. He did this in conjunction with other rail entrepreneurs, and it was very successful.

So, Mr Bannon came up with this idea many years ago and put up the concept. For those members who do not understand, the corridor that this is going to go in is largely all there. It is the old rail corridor. It leaves the main line at Tailem Bend, comes up through Apamurra, then to Cambrai and Sedan. This is an existing corridor, even the bridges are still there. It is just a matter of reopening it. I think even the rails are still there. Admittedly, the sleepers would have to be upgraded.

So, the corridor is there. As the member for Waite and the member for Davenport have said, the benefits for South Australia are obvious. You do not need to bring all this freight into Adelaide. I do not have the stats here, but a huge percentage of it is going past Adelaide. It is purely throughput, so why cart all this stuff into the city?

The big issue for me as the member for the Barossa is the entry point back onto the main line. This could be done—and this has been mentioned by the member for Davenport—via the line to Angaston, which has been covered over by a bike track, but it is not far away. It goes down to Nuriootpa, through that line; it could be linked onto that. There are only about 10 or 15 kilometres to put in there. A more popular option is to go around the top into Truro and come down. That is one of the options listed here. Another option is go to in through Eudunda, and there are existing corridors there too.

So, it is just a matter of putting all this together, because it can—and I think it should—happen. The corridors are already there. So, I commend the member for Davenport and I particularly commend the member for Waite for bringing this motion before us today. The benefits are obvious. He has taken this line from the residents in his electorate, residents in Adelaide; I am taking the line from the residents in my electorate. The residents of particularly Cambrai and Sedan would welcome this. They are lovely communities, and I am sure this would bring about their rebirth.

More importantly, in the future we are going to have to have two new deepsea ports in South Australia. We have already heard one being discussed north of Port Lincoln, which is going to have to happen—and it will happen—and one on our side of the gulf. Without a doubt I think that will be in the area north of Wallaroo. It is called Tickera or Myponie Point, whichever atlas you look at. That is an area where there is deep water, it is open space, it is a greenfield site, and it has railway lines not far away—or at least a corridor is there. The corridor links from Wallaroo through to Snowtown, and that corridor is still there.

We should never have taken up that railway line or stopped using it. It was not the government's fault. I blame the farmers' organisation, the SACBH, with which my family has always been connected. The railways did not upgrade the rail unloader at Wallaroo, so it became inefficient and they closed the railway line. They should never have done that; they should have upgraded that line, that service through the hills. They had some steep grades in there. They should have flattened those with a couple of D9s and kept the line there, and it would be a major line today, because Wallaroo was certainly a major port and still is.

I think the future of this rail service is not just for the quality of life of those living in eastern Adelaide, particularly in Waite and in Davenport, but it is also for the future of South Australia. I will be long gone and so will every other member of this place, but I am sure you will see in the future that Adelaide will not be the major port of South Australia. There will be a port to the north where there is plenty of room to link in this rail line, plenty of room to put an industrial area and plenty of room for a great port expansion, and we will have one on each side of the gulf.

I have always supported this concept. There have been many speeches made about this. I hope that the government will agree and support the member for Waite's motion. I agree that the federal report is severely lacking when you read it. They say that it cannot be justified. Well, heavens above! What price do you put on safety and peace and quality of mind?

Really, the port of Adelaide is going to get totally smothered. The congestion is bad there already, particularly now that we have the deep sea grain port there. Luckily—and I commend the government for putting in the loop line down there—it is going to be extremely efficient in relation to the turnaround of the grain trains and we are going to have a very good operation down there, but the whole area is going to be—

Mrs Geraghty: We get all the road traffic. It's terrible.

Mr VENNING: You do. As the member says, you get the road traffic but, hopefully when the system is working properly, madam, and the costs are proportioned accordingly, I think we will find that the farmers will be attracted to dropping their grain, say, at Roseworthy and it will be trained in on these special trains that do not even stop. They drive into Port Adelaide and they just automatically trigger it as they drive over the grid and they do not even stop. That is the way to do it. That is the way of the future. Likewise, it is the same with Tailem Bend in the south. That will be the same, where the farmers will leave their grain and there will be high-speed trains running from Tailem Bend and from Roseworthy to the port.

When the ships are coming onto the horizon there will not be enough grain actually held at the terminal, but the grain will be held at those two places and can be got in very quickly by this large, fast operating trains. This is the way of the future. We are all going to benefit from this. I hope the government will support this motion, because it is just common sense, and I think you might as well bite the bullet now and start planning. It is going to take a lot of time and a lot of money, but I think it is a step in the right direction. I commend the member for Waite.

The Hon. R.B. SUCH (Fisher) (12:57): I will be very brief. I commend the member for Waite for bringing this motion before the house. I have always been suspicious of the whole consideration of this issue, as I do not believe that the federal authorities have really been serious about this. I think that they have put up a bit of a smokescreen to make it look as though they are doing something and then, lo and behold, come out and say that it is too difficult, too costly, to divert rail freight away from the Adelaide Hills. As the member for Schubert pointed out, the base is already there for an alternative rail route, and that could be and should be explored.

One of the problems at the moment is that you cannot double stack and triple stack the freight coming through because of the tunnels. If you want to modify the tunnels in the Adelaide Hills the cost would be enormous, so that is just one aspect. In regard to the squeal, I live three kilometres from this line. We do not suffer so much from the squeal. I quite like the sound of the diesels pulling the freight through the hills, but I sympathise with the people who live nearby who have to put up with the squeal, because it is quite penetrating and very unpleasant.

I think it is time that the federal government—and it has to be the federal government—and the Rail Track Corporation get fair dinkum with the people who live in the hills and with the community at large and come up with a proposal that is fair dinkum to divert rail freight traffic around the Adelaide Hills with a northern link, which would bring a lot of benefits to the people of South Australia as well as alleviate the torture of the people who live in the Adelaide Hills.

Debate adjourned on motion of Mr Pederick.