Patrick Terminals Media Statement
Last Updated: 10th January 2023
Patrick Terminals’ Statement on the Productivity Commission’s Final Report on Lifting productivity at Australia’s container ports
The amendments to the Productivity Commission’s Final Report reflect the significant feedback provided by industry participants on key matters of landside fees and measurement of productivity at Australia’s container ports. The Productivity Commission’s largely maintained recommendations on workplace reform reveal the importance of these issues to the efficient functioning of Australia’s maritime logistics system.
Patrick Terminals has consistently demonstrated its commitment to the National Voluntary Guidelines and reasonable enhancements over time, including recently announced publication of landside performance metrics and establishment of representative landside groups.
Michael Jovicic, CEO, Patrick Terminals said: “Whilst Patrick considers that the voluntary regime recently endorsed by State and Federal transport and infrastructure ministers should be given reasonable and appropriate time to demonstrate its effectiveness before further review, I note that key elements of a potential industry code are broadly consistent with the voluntary approach and Patrick’s recent industry notification on landside fees.”
Patrick Terminals has advised that a restructuring of terminal operator fees to better reflect the capital requirements and operating costs of providing quayside and landside services to customers has occurred across the recent period. This restructuring has now largely delivered the improved cost causality outcomes sought on the East Coast. Fremantle arrangements will be reviewed in line with lease terms in 2024.
Patrick Terminals does not agree with the Productivity Commission’s approach to analysing market power or its finding that container terminal operators have exercised market power on the landside. Patrick notes the inconsistency with the Commission’s findings in relation to monopoly port operators.
Patrick Terminals’ significant investment program of close to $1 billion across the past 10 years continues to support Patrick’s superior terminal performance and development of further capacity. Industry will understand that shippers do actively seek the best overall value proposition offered by stevedores on both the quayside and the landside. Further, all contracts with landside operators are fully compliant with Australian competition and consumer law.
The industry has experienced significant disruption in recent years, with shipping line schedule integrity dropping from approximately 70% down to 10% during a period where labour availability was impacted due to COVID and industrial action on the waterfront. Despite these material difficulties, Patrick Terminals’ heavy investment in recent years for both landside and shipside infrastructure ensured that customer service levels were maintained overall.
Patrick Terminals agrees with the Productivity Commission’s observations that freight rates are normalising which will provide improved total supply chain costs to Australian shippers.
Patrick Terminals notes that the Final Report makes a range of important workplace recommendations, the majority of which are unaffected by recent changes to the Fair Work Act and remain at the core of securing the long-term productivity of Australia’s maritime logistics system.
Patrick Terminals awaits the Government’s detailed response to all aspects of the Final Report, including the recommended improvements to workplace arrangements to lift waterfront productivity.
Media contact:
Sarah Dennis | Patrick Terminals | +61 418 653 863