In a draft report released last week the Productivity Commission said reform in the container ports could achieve consistent, high performance.
The report said presently importers, exporters and trucking companies are having to pay unfair charges because container terminal operators do not compete with trucking companies’ business.
The report also found that workplace arrangements in Australia’s container ports lower productivity. Earlier intervention by the Fair Work Commission could help resolve protracted disputes about workplace arrangements.
“Australia’s major container ports underperform their ‘best practice’ peers overseas,” said commissioner Stephen King. “Underperformance on Australia’s ports directly costs business and consumers. Any sustained disruptions to imports or exports magnify these costs across the economy because of the critical role of ports to trade and commerce.”
According to the draft report, poor container port performance is reflected in a number of factors.
“For example, terminal operators’ performance in handling containers is highly variable,” said Mr King. “Simply achieving world average ship turnaround times would deliver significant benefits.
“Use of market power is a problem. Truck drivers have to pay whatever price the terminal operator demands to pick up or drop off a container. The shipping lines choose the terminals so they should pay these charges.”
Commissioner Julie Abramson said transport operators and cargo owners have to pay fees to shipping lines when they return containers late because empty container parks, which they are directed to, are full.
“This doesn’t seem like fair conduct,” she said. “Australian consumer law exempts these contracts and this should be remedied.
“Workplace arrangements at container terminals are holding back productivity. Highly restrictive clauses in terminal operators’ enterprise agreements limit the ways that workers and equipment can be deployed.
“Changes to the Fair Work Act and operation of the Fair Work Commission are recommended to tackle protracted enterprise bargaining in container ports and the disruptive industrial action that comes with it.”
Mr King said planning to ensure Australia’s ports can handle bigger ships and growing container freight volumes in coming decades is well underway.
The draft report, Lifting productivity at Australia’s container ports: between water, wharf and warehouse, is being released for comments and further submissions from interested stakeholders. The report can be found at www.pc.gov.au
