RAILWAYS (OPERATIONS AND ACCESS) (MISCELLANEOUS) AMENDMENT BILL

Introduction and First Reading

Received from the House of Assembly and read a first time.

Second Reading

The Hon. P. HOLLOWAY (Minister for Mineral Resources Development, Minister for Urban Development and Planning, Minister for Industrial Relations, Minister Assisting the Premier in Public Sector Management) (17:38): I move:

That this bill be now read a second time.

I seek leave to have the second reading explanation inserted in Hansard without my reading it.

Leave granted.

In February, 2006 COAG signed the Competition and Infrastructure Reform Agreement (CIRA) to provide a simpler and consistent national system of economic regulation for nationally significant infrastructure, including ports, railways and other export related infrastructure. The agreed reforms aim to reduce regulatory uncertainty and compliance costs for owners, users and investors in significant infrastructure and to support the efficient use of national infrastructure.

The agreement commits South Australia to review the State rail access regime and to make certain amendments, where necessary, to include consistent regulatory principles aimed at ensuring efficient and timely investment in infrastructure and effective competition in the provision of rail services (CIRA, Clause 2).

In 2009, the Government directed the Essential Services Commission of South Australia to review the access provisions of the Railways (Operations and Access) Act 1997 and provide advice on:

any amendments to the rail access regime that would be needed to comply with certain parts of clause 2 of the CIRA;

any other changes to the access regime that may improve its overall effectiveness.

This review identified a number of areas where the Railways (Operations and Access) Act 1997 could be modified to provide both greater consistency with the CIRA and improvements to provide greater certainty to access providers and seekers and reduce the red tape burden on the rail industry.

Amendments to achieve greater national consistency

The Bill provides for the adoption of regulatory principles consistent with those to be employed in all third party access regimes nationally. These principles include:

an objects clause to promote economic efficiency and effective competition;

6 month time limits for conciliation and arbitration decisions made according to the conciliation/arbitration framework in the Act to provide greater certainty to business and to reduce the time and costs associated with settling access disputes; and

pricing principles to be taken into account by an arbitrator.

Other improvements to the access regime

Other improvements to the access regime include:

inserting a definition of private sidings in the Act to clarify when a private siding falls, or does not fall, within the scope of the access regime;

inserting a confidentiality provision to protect the confidentiality of information provided by an access seeker to an access provider during commercial negotiations;

limiting the extent to which access contracts require notification, so as to reduce the administrative burden on railway operators;

repealing section 21 of the Act as an unnecessary restriction on operators' business activities, taking into account other provisions in the Act requiring segregation of business activities.

These amendments will provide greater regulatory certainty, reduce business red tape and increase consistency with other rail access regimes.

I commend the Bill to Members.

Explanation of Clauses

Part 1—Preliminary

1—Short title

2—Commencement

3—Amendment provisions

These clauses are formal.

Part 2—Amendment of Railways (Operations and Access) Act 1997

4—Amendment of section 3—Objects

This amendment broadens the objects of the Act to provide for the facilitation of competitive markets in the provision of railway services through the promotion of the economically efficient use and operation of, and investment in, those services.

5—Amendment of section 4—Interpretation

This clause amends 2 definitions—

pricing principles—this definition is amended as a consequence of the amendments to section 38. The definition clarifies that the term pricing principles is used in different contexts in sections 27 and 38.

railway infrastructure—the amendment excludes private sidings from the scope of the definition of railway infrastructure, other than a private siding prescribed by the regulations to be railway infrastructure for the purposes of the Act.

6—Repeal of section 21

This clause repeals the requirement that an operator must not carry on a business other than an authorised business.

7—Amendment of section 22—Segregation of accounts and records

This clause inserts new subsection (1a) into section 22 to require an operator whose railway service business includes providing (or providing and operating) railway infrastructure for another industry participant to keep accounts and records of that part of its railway service business so as to give a true and fair view of that part of the business distinct from the remainder of its railway service business.

8—Amendment of section 31—Access proposal

This clause inserts new subsection (3a) into section 31 to relieve operators of the requirement to give notice of an access proposal to the regulator in relation to proposed access contracts of an annual value of less than $50,000 or for a term of less than 2 months.

9—Insertion of Part 5A

This clause inserts new Part 5A

Part 5A—Confidential information

33A—Confidential information

The proposed section provides that certain information received under section 29 or Part 5 of the Act is to be regarded as confidential information.

The provision provides that a person must not disclose confidential information other than in the circumstances set out in the proposed section.

The provision also prohibits unauthorised use of confidential information, including use of the information for the purpose of securing a personal or competitive advantage.

The provision permits the regulator to disclose confidential information to the Minister or the public if the regulator considers that it is in the public interest to do so.

The provision requires operators to develop and maintain a policy aimed at ensuring that confidential information obtained by the operator is not disclosed or used except as authorised by the provision. A copy of the policy must be provided to the regulator and to any other person who requests a copy from the operator.

10—Amendment of section 38—Principles to be taken into account

This clause adds to the principles to be taken into account by the arbitrator by including reference to the following pricing principles relating to the price of access to a service:

(a) that access prices should allow multi-part pricing and price discrimination when it aids efficiency;

(b) that access prices should not allow a vertically integrated operator to set terms and conditions that would discriminate in favour of its downstream operations, except to the extent that the cost of providing access to others would be higher;

(c) that access prices should provide incentives to reduce costs or otherwise improve productivity.

11—Insertion of section 50A

This clause inserts new section 50A

50A—Time limit for arbitration

Proposed section 50A provides that an award must be made within the period of 6 months from the date on which the dispute is referred to arbitration (the standard period).

However, if after the commencement of the standard period the arbitrator exercises a power under Part 6 in relation to the provision of information or documents, any period between the date of the exercise of the power and the date of compliance is not to be taken into account when determining the end date of the standard period.

Debate adjourned on motion of Hon. D.W. Ridgway.

At 17:39 the council adjourned until Thursday 1 July 2010 at 14:15.