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TOP TIP:
RAIL IS A NETWORK BUSINESS
Hello folks,  

Once again we are hearing the real reminders that our productivity is continuing to slip against that of our trading partners now having gone to 18th on the list.

Anyone who takes notice of our dismal freight transport rankings on the OECD list (25th and last) will not be surprised at our failing productivity but the media commentators, ever looking for a cute reason for this state of affairs, want to blame the exchange rate, old industries, Government failure to pick winners etc; anything but the core problems, the long hard slog to revamp our arteries of the economy, the national freight transport infrastructure.

Now, we are hearing the 'Innovation' mantra being trotted out because the 'old industries' are history.

And so we are seeing transport infrastructure being relegated to the background in this current Federal Election campaign with the inland trunk railway between Melbourne and Brisbane - the most important transport initiative currently in Australia - receiving just a small pittance of money from the recent Federal Budget. A few hundred million dollars to reserve some rail corridor way with much of that not being on the optimal route.

At a cost of 8-10 biliion dollars, my guess is that the Federal Government is not going to find the money for this great project so my suggestiion is that the Goverment moves out of the way, apart from Federal agency oversighting, and let the private sector present their way to achieving the fruition of this hugely important project.











Its time to explain the TOP TIP  about crucial NATIONAL RAIL NETWORKING.

This little snippet is in the Wikipedia encyclopedia.

THE NETWORK EFFECT.   (Italics are mine)
Railroads are subject to the network effect: the more points they connect to, the greater the value of the system as a whole. Early railroads were built to bring resources, such as coal, ores and agricultural products from inland locations to ports for export. In many parts of the world, particularly the southern hemisphere –especially Australia-, that is still the main use of freight railroads. Greater connectivity opens the rail network to other freight uses including non-export traffic. Rail network connectivity is limited by a number of factors, including geographical barriers, such as oceans and mountains, technical incom- patibilities, particularly different track gauges and railway couplers, and political conflicts. -Political differences and track gauges is the continuing great Australian burden whilst  the Americans overcame the geographical barriers.-   End

Recently, I was talking to a work colleague about the lack of a freight rail network here, in Australia . He made a very sensible analogy about computers and the internet. Just 25 years ago, in the late 80's, to own a computer was fairly advanced. It was quite a handy instrument to store information and was great for writing letters and, depending on the software, could even spell check and then send the prepared letter to the printer; fantastic no more white-out needed. Then the internet developed followed by broadband and suddenly we were networked to the world!  The world wide web: As a result, virtual libraries of information were at our fingertips, search engines developed and person to person communications blossomed.  
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FULL PRIVATISATION OF FREIGHT RAILWAYS

Coming now, to the cusp of the message for the Federal and State Governments, regarding the redevelopment of our total transport substructure based on the freight rail nucleus, it is time to outline the objectives for the NEW (rail) Way and importantly, the method to achieve this with the aid of some of the Direct Action funds. If you haven't already, please read: THE NEW WAY .. AUSTRALIA'S FREIGHT RAIL

There, I have referred to the North American network of private freight rail infrastructure and the systemically pivotal, national trunk line through eastern Australia that we call The Great Australian Trunk Rail System. Read also: THE SOLUTION.

So now it is time to address the method that will attain this New (rail) Way, this Australian version of the North American model of private railroad network(s). This means of course, that almost total Government divestment of rail infrastructure and equipment, pertaining to freight infrastructure needs to occur but, in a way that one commentator, whose name I have unfortunately misplaced, succinctly suggested that governments should “consider ways to maximise the competitive benefit rather than the sales proceeds when privatising state-owned enterprises,...'

How true this comment really is; rail branch lines, many of which are stranded infrastructure -because of the different gauges-, and current main lines cannot be just flogged off to the highest bidder; if there are any expressions of interest, that is. They have been run in the red for so many years, on the various Governments' drip feeds and hopelessly undercapitalised that, forcing the cost of a sale price upon them, will just make them sink further into the red, the best efforts of private enterprise notwithstanding.

Productivity and competitive benefit must be the key drivers in the overall national strategy to redevelop the substructures into a national network.

Pivotal to the national strategy is the GATR System, initially between Melbourne and Brisbane (with an equivalent Class 1 standard link across the southern highlands to Sydney/Canberra). Co-opting the Productivity Commission and Infrastructure Australia, the Federal Government, with the co-operation of the owners, the State Governments, should set the framework for the entry of private enterprise and perhaps, Direct Action grants into the ownership transferral and the New (rail) Way redevelopment. It is envisioned that two Class 1 rail companies will come into existence (but perhaps more?) and their physical introduction will be the construction of the national trunk line, in two parts from north and south, meeting at Parkes in NSW. Each company will own and operate the respective sections but will have reciprocal operating rights or leases over the other's tracks. The Productivity Commission, taking considerable interest in this aspect as this is the real beginnings of full rail freight competition in Australia, will be assessing the various expressions of interest for the greatest competitive benefits and hence will make its recommendation to the Federal Government regarding sizes of financial grants for the respective bidders' projects.

BUT THERE IS MORE.
There is one extant, national trunk line to be considered and that is the east-west line from Parkes to Perth. This line will experience a substantial increase in transport relevance as a result of the north-south trunk operation and should also come under a Class 1 Rail ownership and operations entity. Whether this is an avenue for another Class 1 companyto come into existance or be split between the two winning bidders of the GATR System is not for me to determine but the obvious path should come to the fore during the EOI process and be finally determined as a result of the tendering process. The GATR System beneficially affects the whole of the Australian transport substructure and operations so the Class 1s of the GATR System will develop  wide ranging reach to all corners of the nation and be the springboard to northern Australian development and the spread of a full transport network linking into the broad Indonesian archipelago. Read the ASIAN EXPRESS.

STAGE 2

Establishing the Class 2 & 3 private railroads, the vital sub-structures of a national transport network.

The absolute pillars of viable and productive shortlines are clearly, the Class1, national trunklines forming the major arteries of a national network. Put another way, a national network is a trunkline borne system that isn't complete until the cross connector (Class 2) and branch/shortline (Class 3) subsectors are in place. Then comes the enterprise and investment of the private sector followed by the recognition by the Federal Govt. (Infrastructure Australia & the Productivity Commission) that strategic grants will be necessary in order to overcome the huge backlog in track renewal and maintenance.

THE CLASS 2s & 3s    Please read on








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