Australia depends on shipping as a service

With a federal election upon us it’s time to remind both sides of the political divide that the best interests of Australia are served by focusing on optimising the benefits that international shipping provides to the greater good of ordinary Australians.  

Shipping should not be used as a pawn in the chessboard of politics nor should it be considered or as the golden goose to squeeze for more fees and taxes.  The more taxes you impose on international shipping visiting Australia, the more every Australian will pay for the imported goods they use – fuel, building materials, fertiliser and household appliances.   

Shipping Australia Limited is disappointed that both the Coalition Government and the Labor Opposition are committed to imposing a new biosecurity levy, an inefficient new tax on imports which will cost every Australian a lot more than if the same amount of revenue was raised through an efficient tax such as GST or income tax.  But the public has no escape from this approach as it seems that one of the only areas of bipartisan agreement is how to extract money from ordinary Australians without them realising it.

Shipping Australia Limited is also concerned that the Australian public is being misled over the current contribution of the international shipping fleet to Australia’s economic well-being. Australia’s economy is absolutely dependent on international shipping.

Australia’s maritime security is best served by a strong Navy and Australia’s fuel security is best served by greater onshore storage reserves and clever utilisation of ships of multiple flags to carry our fuel imports.  The more different flags we utilise, the more resilient the fleet and the better Australia is protected in the event of a war.  If some nations become unable or unwilling to participate in trade with Australia, there will still be plenty of others who will.  The alternative, to carry all our oil supplies in Australian flagged and crewed ships would be foolish.  It would leave Australia in a position of being held to ransom by a militant union, even when there is no war.

Irrespective of the government in power, their domestic freight policy should include promotion shipping as a mode. As an island nation, Australia is dependent on shipping for most of its trade.  Shipping should be acknowledged as the preferred mode of long-haul domestic freight movement because it is more economical, more efficient, safer and more environmentally sustainable than other transport modes.  It is also able to deliver oversized, heavy and bulky cargo with minimum impact.

It is imperative for any elected government to include coastal shipping, alongside road and rail, in any business case related to infrastructure investment projects. Promoting modal shift to sea freight must be part of the its national freight priorities.  It just makes sense.

Shipping Australia Limited would be happy to see Australian flag ships operating at a profit in domestic and international markets.  However, even with further tax concessions for investment in Australian shipping we recognise that it will be a challenge to make Australian flag operations commercially viable. But the industry is moving towards automation which will reduce crew costs to competitive levels. 

There are real concerns that if manufacturers and primary producers are are faced with higher charges than they can afford to move cargo in Australian flag vessels it will lead to further import substitution of raw materials or finished products and may force the closure of Australian manufacturing businesses.

Any talk of subsidising Australian flag ships to carry cargo at competitive rates is ludicrous.  That would be asking ordinary tax paying Australians to subsidise the wages of a chosen few.

Commercial shipping is a service, it is a means to an end, not an end in itself.  Shipping is needed to move cargo internationally and domestically.  Australia can control it through appropriate regulation, but just like UBER, you don’t have to own it to use it.