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Battle lines drawn in lead up to federal election

After more than seven months of radio silence on a warts-and-all Senate inquiry into the road transport industry, the federal government has finally tabled its response.

Landing quietly amongst the noise of the federal budget announcement, the 21-page comeback to the Without Australia Stops: the development of a viable, safe, sustainable and efficient road transport industry report, will contain few surprises for Labor supporters.

The government said it does not support four of the 10 recommendations made by the Glenn-Sterle led Rural and Regional Affairs and Transport References Committee, including the setting up of an independent body to oversee pay rates and contract terms.

The other six recommendations are designated a ‘noted’ status, which is government-speak for ‘we know they’re good ideas, but we won’t take any of them up in the format suggested’, a source familiar with reports of this kind tells us.

Below is a recap of the Senate recommendations with edited summaries of what was tabled this week. For the complete government responses go here.

WA Labor Senator Glenn Sterle chaired the Senate inquiry.

Senate recommendation 1

The committee recommends that the government establishes or empowers an independent body that will, in consultation with industry, set universal and binding standards (including binding standards with respect to pay) which:

  • ensure the safe performance of work and eliminate unsafe economic and contracting practices; and
  • apply to all road transport supply chain participants, including transport operators, online/on demand operations, and workers (regardless of their employment or work status), and throughout supply chains.

The independent body shall also act as a dispute resolution body providing all road transport industry participants access to comprehensive binding dispute resolution capable of addressing all issues associated with, and general powers to resolve, disputes between some or all supply chain participants.

Government response: does not support

“The establishment of an independent tribunal to address rates of pay and conditions in the road transport industry has been tried before with negative impacts on owner-drivers, small and family transport operators. The Australian government abolished a similar body in 2016, the Road Safety Remuneration Tribunal (RSRT), following two independent reviews and feedback from industry participants confirming that, while the aim of the RSRT was to improve safety, the use of financial incentives and strict regulation had significant unintended consequences on participants in the sector.

“Economic analysis by PricewaterhouseCoopers showed the RSRT’s two remuneration orders would result in a net cost to the economy of $2.3 billion over 15 years with no tangible impact on road safety. It also found there was limited and contradictory evidence to show any relationship between safety and remuneration.”

Editor’s note: Labor freely acknowledges it got the RSRT wrong and has repeatedly said a newlook tribunal would steer well clear of the many shortcomings exposed in the first iteration.

Recommendation 2

The committee recommends that the proposed initial priorities of the independent body should include to:

  • ensure that all workers, whether owner drivers or employee drivers, are paid for all work time, including driving and non-driving time, and that any costs or efficiency dividends associated with this change are allocated fairly throughout  the supply chain;
  • institute a system of demurrage rates to help drivers and operators recoup costs for waiting and loading times, and that any costs or efficiency dividends associated with this change arefairly distributed through the supply chain; and
  • establish binding industry payment terms ensuring that all road transport workers and operators are paid in full upon-delivery.

Government reponse: does not support

“As noted at recommendation 1, many drivers working as independent contractors will have the services contracts to which they are a party covered by the Independent Contractors

“Act 2006, and may be able to apply to a Court to have such a contract varied or set aside if it is ‘harsh’ and/or ‘unfair’.

“In relation to employee drivers, if an eligible party wishes to include a new allowance, they can apply to the Fair Work Commission to vary, omit or include.terms in the relevant modern award.”

Recommendation 3

The committee notes that any effective standard-setting body must be underpinned by robust and adequately resourced enforcement mechanisms. The committee recommends that the government establishes an effective enforcement framework to ensure compliance with standards (including those established by the proposed independent standards-setting body) by:

  • providing industrial and road enforcement agencies with dedicated enforcement frameworks and resources;
  • providing the Fair Work Ombudsman with resources to conduct a review of independent contracting arrangements in the road transport industry in order to eliminate sham-contracting;
  • providing the capacity for registered industrial organisations, such as trade unions and employer organisations, to carry out inspections and enforcement through transport supply chains; and
  • compelling all road transport supply chain parties to disclose information about their contracting networks throughout their supply chain and provide such information to registered industrial agencies and enforcement bodies.

Government response: does not support

“The Fair Work Act 2009 (FW Act) contains protections from sham contracting conduct, such as knowingly or recklessly misrepresenting employment as an independent contracting arrangement.

“The FW Act includes a civil penalty regime to penalise and deter employers from engaging in sham contracting conduct. Contraventions of the sham arrangements provisions carry a maximum civil penalty of 60 penalty units ($13,320) for an individual and 300 penalty units ($66,600) for a body corporate.”

Recommendation 4

The committee acknowledges the various challenges facing the road transport industry arising from a failure to provide universal licensing and training credentials and to support pathways for young and underrepresented road transport workers. The committee recommends that the government works with state and territory governments (in consultation with relevant registered organisations of employers and workers) to:

  • introduce a standardised, universal and compulsory safety induction unit for the road transport sector;
  • introduce an industry skills passport for recording these and all other induction and training credentials;
  • expedite the Infrastructure and Transport Ministers’ Meeting consideration of the Austroads review of the Heavy Vehicle Driver Competency Framework and licensing arrangements and implements the results as a priority;
  • develop a national apprenticeship scheme for the road transport industry;
  • work with Safe Work Australia and in consultation with industry representatives, to develop safe strategies for enabling 16 to 18 year olds to train on forklifts; and
  • implement incentive program for businesses that attract young trainees, women and people from disadvantaged backgrounds into the industry.

Government response: noted

“The Australian Government supports the Austroads review of the National Heavy Vehicle Driver Competency Framework and notes that work is underway to progress Framework.

“While the Australian Government recognises the importance of industry-led development of nationally recognised training, apprenticeship arrangements are managed by states and territories. The Prime Minister, the Hon Scott Morrison MP, announced on 20 December 2021 that the Transport and Logistics IRC consulted industry stakeholders and recommended a potential apprenticeship pathway for heavy vehicle drivers. If adopted by state and territory governments, such a pathway could help to professionalise the road transport workforce, improve training completion rates, and increase safety standards and the appeal of the industry to younger workers.”

Recommendation 5

The committee acknowledges the importance of ensuring that robust investigatory, reporting and data collection systems are established in the road transport sector. The committee recommends that the government:

  • expands the powers of the Australian Transport Safety Bureau to carry out independent, no-blame safety investigations of road crashes involving commercial heavy vehicles;
  • ensures all commercial vehicle crashes are recognised, treated and investigated as workplace accidents; and
  • improves data collection on the incidence and causation of work injuries and illness for both employees and owner drivers across jurisdictions.

Government response: noted

The Australian Government notes the recommendation to expand the Australian Transport Safety Bureau’s (ATSB) powers is consistent with recommendation 9.4 of the Productivity Commission’s Report (PC Report) into Transport Regulatory Reform.

Further work is needed to identify the benefit and scope of any potential expansion of the ATSB’s responsibility. In further considering recommendations of the PC Report, the Australian Government will consult with state and territory governments, regulators, the ATSB and industry in relation to the Rural and Regional Affairs and Transport References Committee’s recommendation 5. This will include scoping issues including expected benefits to industry, resourcing options, potential legislative amendments, capacity needs within the ATSB and merits of different implementation options. To avoid duplication, consultations will clearly delineate responsibilities between the ATSB and other organisations (such as regulators) involved in safety investigations and research.”

Recommendation 6

The committee recognises the importance that road infrastructure and driver facilities have in delivering a safe, sustainable and productive road transport sector. The committee recommends that the government:

  • develops a set of national guidelines for town planners regarding road envelopes and other factors required to facilitate efficient and safe road-based logistics support in metropolitan areas;
  • identifies priority roads for dedicated and targeted road funding partnerships with relevant jurisdictions to improve the star rating performance of road infrastructure for all road users;
  • adopts national guidelines for the design and placement of heavy vehicle rest areas for major highways and significant freight routes;
  • work with all states and territories to mandate heavy vehicle only rest areas;
  • supports a public education campaign that demonstrates why heavy vehicle drivers must have access to designated rest areas;
  • increase the allowable vehicle and combination dimensions for heavy vehicles to allow for additional driver amenities;
  • establishes a national fund to assess, maintain and upgrade freight road in rural and regional areas, to meet the minimum frequency and quality of heavy vehicle rest areas contained in the national guidelines and to support the rolling out of low-cost safety infrastructure such as rumble strips, green reflectors, wider medians and improved road shoulders; and
  • establishes an independent national regulator to set commercial vehicle charges including toll road and port charges.

Government reponse: noted

“The Australian Government, together with states and territories and industry, has worked to develop the National Urban Freight Planning Principles (the Principles). The Principles were endorsed by Infrastructure and Transport Ministers in May 2021.

The Principles will bring together transport and land use planning and are intended to flow through to strategic planning and detailed planning guidance documents over time. The Principles are encouraged to be incorporated into state and territory level instruments and mirrored in local government planning schemes where appropriate.”

Recommendation 7

The committee recognises the role which technologies can have in supporting broader industry safety initiatives. The committee recommends that the government:

  • funds an education and awareness campaign around the benefits to small operators of the use of telematics devices, both in safety and efficiency;
  • ensures that all such telematics and other technologies meet strict guidelines designed to protect drivers’ privacy;
  • ensures that legislative and regulatory systems are reviewed to prepare for the emergence of automation and ensure that the risks and challenges which it may present to workers are effectively mitigated; and
  • through the proposed independent standards-setting body provide cost-recovery rate allowances for the take-up of telematics  and other safety critical technologies

Government reponse: noted

“The Australian Government notes the benefits of telematics in producing safety and productivity outcomes. The Australian Government will further investigate the benefit and need for initiatives to support education and awareness of telematics benefits in consultation with states and territories.

As part of the Heavy Vehicle National Law (HVNL) Safety and Productivity Program, options are being considered to encourage use of telematics.”

Recommendation 8

The committee recommends that the government:

  • reviews the Reserve Bank of Australia’s Banknote Distribution Agreement (BDA) and the operation of the wholesale cash system and the relationship between the Reserve Bank of Australia, the BDA and approved cash centres; and
  • in consultation with industry participants, investigates the creation of national operating standards, accreditation and licensing scheme for the cash-in-transit

Government response: noted

“The Reserve Bank of Australia is in the process of conducting a public Review of Banknote Distribution Arrangements to consider changes to ensure the sustainability of cash distribution. The consultation was announced by the Payments System Board on

21 May 2021 and an issues paper was released on 15 November 2021. Submissions closed on 21 January 2022, with a subsequent paper providing a summary of consultation responses and setting out recommendations expected to be released in mid-2022.”

Recommendation 9

The committee recommends that the government:

  • develops an industry wide market-based ratings system to incentivise best-practice in the industry;
  • ensures all current and future government contracts with a road transport component are only awarded to road transport operators with the highest standards of industrial and road safety compliance throughout their operations and supply chain;
  • develops a plan and sustainable funding mechanism for establishing managed roadside livestock effluent disposal sites on key livestock freight routes in Australia;
  • amends national laws to incorporate an appropriate fit for purpose national framework for managing fatigue; and
  • appoint a dedicated Minister for Transport.

Government reponse: noted

A new heavy vehicle operator assurance scheme is currently being considered under the Heavy Vehicle National Law (HVNL) Safety and Productivity Program. The new scheme is intended to support a flexible approach to meeting legislative requirements. Industry stakeholders will be closely consulted on a new scheme to ensure it reflects the needs of industry. The Australian Government supports sound regulation, education and operator assurance as appropriate mechanisms to encourage best practice, rather than a rating system which could prove to be anti-competitive.

Recommendation 10

The committee recommends the establishment of a Transport Advisory Group or commission that:

  • consists of members from the transport industry and unions;
  • functions as a consultative and advisory body for ministers responsible for the infrastructure, transport and road freight portfolios; and
  • meets regularly to facilitate ongoing dialogue and provide updates on matters of importance to the road transport sector.

Government reponse: does not support

“Establishing a Transport Advisory Group or commission would duplicate the functions of existing groups.

“As part of its role to develop, coordinate and progress the strategic agenda of the Infrastructure and Transport Ministers’ Meeting, the Infrastructure and Transport Senior Officials’ Committee is required to engage with industry representatives to ensure ministers have access to high level advice from industry about the items it is considering.

“Additionally, a number of working and executive groups support the policy direction and decision making of Infrastructure and Transport Ministers. These groups represent a diverse range of industry bodies, operators and state and territory governments.”

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