Shipping Australia representatives attended Mr Albanese’s Federal Labor party’s shipping policy launch for the 2019 election campaign, which was hosted by Maritime Industry Australia Limited (MIAL) at the Australian National Maritime Museum.
The policy launch was consistent with the Labor policy announcement of 24 February which outlined the central pillar of the establishment of a Strategic Fleet. Available here
Labor intends to more stringently enforce the current Coastal Trading Act. There were no specific changes to the Coastal Trading Act proposed, but Mr Albanese did acknowledge that as the Act has not been amended since its inception in 2012, it was not perfect and there should be some adjustments.
Labor wishes to establish a Strategic Fleet, the details of which are to be determined by a Strategic Fleet Taskforce. It is intended to provide a number of Australian flagged and crewed vessels that will be privately owned and operate on a commercial basis. Mr Albanese mentioned that he would prefer these ships be Australian built, but this was not stated as policy. The Strategic Fleet would be particularly focused on liquid bulk fuel importation and this was intended to improve fuel security. It would also provide blue water training billets for Australian seafarers.
Mr Albanese opened the door to further taxation concessions to support the commercial viability of Australian flag vessels, including the potential for investors in Australian shipping to receive tax free dividends. He also indicated his support for tax exemptions for Australian seafarers to provide a level playing field.
Labor would also re-establish the Maritime Workforce Development Forum.
Mr Albanese supported the increased use of shipping to move domestic cargo around our coast noting that the infrastructure was already in place and the blue highway was free.
In question time it was highlighted to Mr Albanese that Shipping Australia’s members are a combination of Australian general ships’ agents, Australian companies acting as agents of international shipping companies and foreign shipping companies. Our full members employ more than 3,500 Australians in 70 ports around Australia. Shipping Australia Limited would like to be included in future shipping policy consultation including the Strategic Fleet Taskforce and the Maritime Workforce Development Forum.
Shipping Australia also recognised Mr Albanese’s strategic foresight in providing an exemption for cruise vessels greater than 5,000 GRT from the Coastal Trading Act, noting the consequent massive growth of this sector.
Shipping Australia also asked if he would consider a similar exemption for large container ships which would allow them to easily carry domestic containers between Australian ports incidental to international trade. This would result in better uitilisation of the blue highway, and reductions in import substitution, green-house gas emissions and unnecessary road deaths. Mr Albanese expressed caution in providing exemptions in case of unforeseen and unintended consequences, but he did support the increased carriage of domestic cargo by sea.
Shipping Australia’s comment on Labor’s Shipping Policy
Shipping Australia’s members do not expect to be impacted by the rigorous implementation of the Coastal Trading Act. Few of our members carry domestic cargos due to the inflexible restrictions of the Coastal Trading Act. Those that do, already comply with the Act and its regulations.
Our members would be happy to see more Australian flag vessels, which is the key element of the Strategic Fleet. However, even with the proposed further tax concessions for investors in Australian shipping, we recognise that it will be a challenge to make Australian flag operations commercially viable or competitive with international shipping. There are further concerns that if manufacturers and primary producers are forced to pay higher charges to move cargo in Australian flag vessels it will lead to increased import substitution of raw materials or finished products and may lead to the closure of Australian manufacturing businesses. This consequence would not be good for Australia.
Shipping Australia does not consider that more Australian flag vessels will provide benefits to national or fuel security. The best investment in fuel security is to increase onshore fuel storage reserves, maintain the domestic capability to refine fuels and ensure that we have a variety of overseas suppliers utilising vessels of various flags. This ensures that there are still lines of supply available in case of a conflict which might impact on the availability of some supply lines.
Also, as highlighted by Mr Albanese in his address, in times of conflict the Australian Navy has show their ability to charter foreign flag vessels to provide military support. International shipping is a commercial business and there are always vessels of all types and capabilities available to charter. These can be re-flagged as necessary to meet Defence demands.
