Flinders' Pain Highlights The Role Of Shipping

First published in the Melbourne AGE, October 23, 09

This vital cog in our economic wheel has been neglected for too long.

ANYONE doubting the importance of coastal shipping to Australian trade and commerce - and more importantly our Australian communities - should look no further than the shipping disaster that has visited Flinders Island in the past fortnight. The experience of this micro economy is a salient lesson for all levels of government not to undervalue essential transport infrastructure, particularly coastal shipping.

It's particularly relevant to the Federal Government as it considers incentives to revitalise Australian domestic and international shipping.

Shipping is vital to Flinders, 50 kilometres off the northern tip of Tasmania, which imports milk, cheese, chickens and other dry goods and exports sheep and cattle, and since May, pine logs. A small abattoir and a niche milk-fed lamb industry mean that this community needs a reliable service. But complaints from the island's population in the past fortnight show the service has been sadly missing.

With mainland Australia largely oblivious, in the week before a very special day in Bass Strait, the Flinders Island Show, the crew of the Matthew Flinders refused to sail from Tasmania. The crew simply wanted to be paid after a record of unreliable payment by the operator.

It was like cutting the island's umbilical cord. Vital supplies for the celebrations were suspended.

Farmers with livestock ready for market, indeed the entire community, were highly stressed. What resulted was a stand-off.

An alternative shipper was contracted temporarily, other supplies found and a proud and resilient community led by Flinders Island Mayor Carol Cox reports that the show and the local Volunteer Ambulance dinner were both successful events.

The State Government, provider of a $245,000 ''service fee'' to operator Southern Shipping, advised the company it was in breach of contract to provide services to the island.

The parties are now working through a dispute resolution process. At least for now, despite a long list of complaints about the service, Southern Shipping appears to have the job, with a contract expiring in 18 months.

Meanwhile, the Tasmanian Government is considering its options, including taking over the shipping service within two years to secure transport to the island.

Tasmanian Infrastructure Minister Graeme Sturgess has also committed to working through a possible community ownership model. There are also standby arrangements in place.

But these sort of arrangements need to be watertight.

The Maritime Union of Australia (MUA) has no members at Southern Shipping, but the union is assisting to negotiate an agreement for these workers.

They will refuse to work until they have firm guarantees that their outstanding entitlements have been paid, issues including occupational health and safety been resolved, and that they will not have the same problems in the future.

Without indulging in retrospective wisdom, the union did strongly advise the Tasmanian Government against the terms of the original tender for the shipping service and indicated at the time that this placed the future of the new service in jeopardy.

The initial advice stands and if a long-term sustainable trade is to be delivered, the Government needs to reassess both its support and also the industrial mechanisms that secure long-term professional and competent crews.

There is a lesson from all this. From Flinders to the Australian mainland, coastal shipping is in dire need of attention, due largely to a negative policy from the previous federal government.

From 1994 to 2008 the median age of the Australian fleet increased from 14 to 19 years, while the international median fleet age dropped from 15 to 12 years and the number of Australian registered ships dropped from 55 to 40.

The share of domestic freight carried by foreign registered permit vessels, mostly flag of convenience vessels using tax havens as their competitive edge, increased from 6 per cent to about 30 per cent at the same time.

Transport Minister Anthony Albanese has confirmed he remains committed to revitalising Australian shipping, and is considering in detail recommendations from the independent inquiry into coastal shipping. The report's recommendations provide a package of measures that will need to be adopted by both Government and industry if there is to be sustainable reform of shipping.

For consideration are fiscal incentives including accelerated depreciation and a tonnage tax less onerous on ship owners and common in major shipping nations where shipping makes an essential economic contribution.

The package also recognises that, like the rest of the world, we need proper training for new seafarers to stem the skills shortage, including a national maritime skills strategy.

All these changes promise to strengthen shipping trade and boost economies. Most importantly they should help provide security and reliability to an island economy.

Paddy Crumlin is national secretary of the Maritime Union of Australia.

First published in The Age