Ports Minister, Paul McLeay, has issued a media release listing penalties which will apply to Stevedores and Truck Drivers who don’t deliver on time.   “The issue for industry is to increase efficiency and productivity at Port Botany, by reducing congestion and continuing to drive towards high-performing 24/7 operations,” Mr McLeay said.  Sydney Ports will also increase existing wharfage by $10 per TEU (container) for all imports and exports.

Stevedore must pay the road carrier $25 for every 15 minute delay;
Stevedore must pay the road carrier $100 for cancelled slot if cancelled within 2 hours of slot or $50 to be paid for cancelled slot outside this period;
Road carrier must pay the stevedore $50 for late arrival; and
Road carrier must pay the stevedore $100 for no-show.

Sydney Ports and NSW Treasury argued for expanding at Botany and not at Kembla or Newcastle saying it would cost more to bring containers to distribution centres close to Sydney (the cost was supposedly $40 per container – in the case of Kembla servicing distribution centres in Sydney’s SW others, including the ex-CEO of that port,  argued that Kembla was just as quick.)  Yet since the decision to move ahead with the Port Botany expansion we have witnessed increasing congestion at Port Botany and now increasing wharfage fees.  The penalties will add more to the cost of moving containers and as with the wharfage impost doesn’t discriminate between importers and exporters of empties and Australian Exporters.   There is also a real fear that truck drivers caught  in traffic jams in the M5 tunnel may not be so tolerant of smaller vehicles  as they try their best to reach the port in time to avoid penalties.

full media release:

Paul McLeay MP
Minister for Ports and Waterways
Minister for the Illawarra
MEDIA RELEASE
Thursday, April 29 2010
NEW REGULATIONS TO IMPROVE PORT EFFICIENCY
The NSW Government is taking bold steps to reduce port congestion, improve efficiency and ease freight delays at Sydney’s Port Botany stevedoring terminals.
Ports and Waterways Minister, Paul McLeay today announced the historic regulations as part of an overall Port Botany Landside Improvement Strategy (PBLIS) – which promotes better landside efficiency, consistency, transparency and most importantly productivity.
Mr McLeay said the measures will also help meet the challenges of increased activity at the port.
Container trade throughput continues to reach record highs, with TEUs for the first three quarters in 2009-10, up 4.8 per cent on the same period last year.
“This is all about introducing fairness and equity into landside arrangements at Port Botany,” Mr McLeay said.
“These new regulations will be the first step in introducing greater transparency and accountability between stevedores and transport carriers, with the overall objective of making the entire land supply chain more efficient.”
Mr McLeay said there has been improved cooperation in the performance of rail operations at Port Botany over the past 12 months.
“While there has been some improvement with truck carrier movements and development of the reform plan we can no longer wait for stevedores to fully embrace landslide reform,” he said.
“We need to drive efficiency in a supply chain that is facing growing demand.”
The first phase of the reforms will involve a new Operational Performance Management (OPM) framework between stevedores and transport carriers at Port Botany.
This will see the introduction of performance benchmarks.
“For the first time truck carriers will be able to receive a penalty payment if stevedores fail to meet standards set by the OPM framework,” he said.
“The OPM framework establishes a clear commercial relationship between transport carriers and stevedores.”
“The issue for industry is to increase efficiency and productivity at Port Botany, by reducing congestion and continuing to drive towards high-performing 24/7 operations,” Mr McLeay said.
Mr McLeay said that the OPM will also be supported by new technology at the port which will accurately and transparently monitor landslide operations.
He said that as part of managing PBLIS, Sydney Ports will increase existing wharfage by $10 per TEU (container) for all imports and exports.
“Port Botany is the largest container port in NSW and the centre of Australia’s most significant logistics supply chains,” Mr McLeay said.
“As part of PBLIS, we must have co-operation from all parties – stevedores cannot operate in isolation to the rest of the supply chain servicing Port Botany.
“We have to work together if we are to address ongoing congestion at the port and meet the challenges of future trade growth over the next 20 years.”
Mr McLeay said the reforms would have flow on benefits to the wider community, including traffic safety on roads near the port.
“I am mindful that an efficient operation also reduces traffic congestion and improves amenity for the thousands of people who live in the Port Botany area.”
The new regulations are expected to be introduced by the end of the third quarter of 2010.
Further Information
• Before the reforms there were no incentives for stevedores to service trucks in a quick and timely fashion.
o If a truck was late or did not arrive, they paid a penalty to the stevedore.
o If a stevedore did not service a truck or was late in servicing a truck there was no penalty. The truck operator wore the cost of waiting.
• PBLIS will rectify this by implementing a series of mandatory regulations and penalty payments will flow between the stevedores and road operators directly. The penalties will be:
o Stevedore must pay the road carrier $25 for every 15 minute delay;
o Stevedore must pay the road carrier $100 for cancelled slot if cancelled within 2 hours of slot or $50 to be paid for cancelled slot outside this period;
o Road carrier must pay the stevedore $50 for late arrival; and
o Road carrier must pay the stevedore $100 for no-show.

One Response to “New Penalities at Port Botany”
  1. admin says:

    Published in Transport and Logistics News 7 May 2010
    The shifting sands of Port Botany by Charles Pauka

    After more than a year of consultation, planning, discussion, research and design work, Sydney Ports Corporation has finally released its strategy for landside logistics improvements, but Patrick – and many transporters – don’t want a bar of it.

    The briefing session held on Thursday morning was a fascinating spectacle, with Patrick representatives and a number of transporters joining in a united chorus condemning the plan.

    Considering that a few months ago you couldn’t leave them unsupervised in a room by themselves for fear of a bloodbath, the new-found camaraderie was all the more remarkable because the strategy seeks to address exactly what the transporters had been – loudly and forcefully – arguing for: prescribed, measurable and enforceable performance standards for the stevedores, to give the transporters a measure of equality in a very one-sided business (non)-relationship.

    It is amazing how short some memories are. After all, it has only been a few short months since truck drivers were forced to wait, in searing heat and with no facilities, for more than six hours at Port Botany – the congestion was so bad that the police and council rangers had to become involved.

    After a shake-up of management and the loss of sizeable market share (Patrick is said to be down to just 35% of the container traffic at Port Botany), however, Patrick has improved its truck turnaround times (TTT) and even began to be nice to transporters, allowing 30 to 60 minutes of leeway for late-running trucks.

    But the company now says (read Patrick’s response here) that the new penalty system will remove its ability to show flexibility towards late-running trucks, a point the transporters were quick to pick up on at the briefing.

    They quickly joined Patrick in condemning the strategy in general and the penalty system in particular. Many transporters said that if their trucks can’t get through the M5 tunnel – apparently the reason for some 80% of late arrivals – and miss one slot, not only do they get penalised once but because of snowballing delays, they will get a number of penalties and Patrick will not be able to allow them the flexibility to pick up or deliver their containers late.

    Which leads one to ask: how is the Sydney Port Corporation supposed to come up with a workable strategy that will be acceptable to all? How long will the trucks be delayed in the M5 tunnel? How can any strategy allow for unforeseeable delays outside its boundaries? How many trucks would be disadvantaged, who turned up on time, by the stevedores servicing the late ones?

    With due respect to the stevedores, it appears that when one picks up its game, the other one drops the ball, and before long the situation reverses again… and again… and again. Only a few months ago, DP World was the shining light, but as they won more business from Patrick, they are falling behind in performance. Patrick, with its lower volumes and management shake-up, is performing extremely well now, but for how long? We hope that they have permanently turned the corner, although past experience suggests otherwise.

    And what will the transporters say if or when congestion increases once again, for example, in the run-up to Christmas? If the stevedores’ performance falters again, what will be the trucking industry’s demand for resolution?

    The current PBLIS strategy has already made a major concession to transporters, by putting the peak period pricing regime on the backburner. With clear, measurable and enforceable operational performance management standards, the current plan gives as much certainty to both parties as is humanly possible under the circumstances.

    As for the M5 tunnel, allow an extra three hours and take a good book – something of War and Peace proportions.

    Do you have a comment? Please send it to info@TandLnews.com.au.

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