Former Nationals MPs welcome WA Labor’s decision to explore taking on WA’s grain freight network

As former MPs, we welcome the decision by the WA Labor to reopen discussions on the future of the grain freight network, owned by Canadian conglomerate Brookfield through its subsidiary Arc Infrastructure. The history surrounding Liberal and National governments’ (the Court and Barnett-Grylls Liberal-National coalition) sale of Westrail, the State’s regional passenger and freight network could only be described as gross commercial incompetence, financial ineptitude and, regrettably, personal, petty point scoring. To add to this, certain shire representatives on WA Local Government Association at the time all failed to protect the interests of the people of WA in terms of road safety, productivity gains and extracting value from a State asset. In 2000, the Court government sold Westrail’s freight business to a consortium comprising of Genesee and Wyoming and Wesfarmers for $586 million and entered into a lease of the rail freight network for 49 years. Details of the sale and lease documents were denied scrutiny by the WA public by the Liberal National Party government of the day under cabinet confidentiality. We both found these documents, which showed there was an undertaking provision that $400m be invested in rolling stock and infrastructure (reported by the Public Transport Authority). But there was no oversight clause to ensure it happened to protect erosion of the State’s asset from the time value of money. With shoddy drafting by government, the “undertaking” is played by the private sector for its best advantage, to the financial disadvantage of the government, and the taxpayer. Wesfarmers, Genessee and Wyoming subsequently sold their lease in 2006 — Brookfield becoming owner of what is termed the “below rail” asset, in 2009. Other parties took the lease of the rolling stock. As far as can be seen, none of the owners of the leased “below rail” asset have met the “undertaking” of spending $400m on the network. Who is holding these lease owners to account? The Barnett government accepted the flawed 2009 Strategic Grain Network Report which favoured investment in road infrastructure over rail on the flimsiest of evidence. A number of the parties involved with the writing of the report failed to sign off on it, yet the Barnett-Grylls government relied on that report to justify its actions with regard to rail and their negotiations with the leasehold owners. They were complicit in allowing the leaseholder escape the lease provisions as outlined in the concealed agreement of returning the lines to the WA Government after 49 years, in the same condition as they found those lines when the lease was first agreed in 2000. In 2011-12, after the government abandoned the Tier3 rail network, then WA treasurer Troy Buswell proposed an investment of $180m for roads encompassing the Tier 3 network area. This was assessed by road engineers of the day to likely be totally inadequate, and even this proposal overlooked a narrow bridge between Quairading and Cunderdin conservatively estimated to cost $14m to take heavy road transport. Again, there was no oversight into ensuring $400m was spent. But it was going to get worse. The Court-Grylls government amended the terms of the lease in terms of “uneconomic” and “fit for purpose”. This may provide wriggle room for Arc Infrastructure. The Cook Labor Government’s application of Schedule 15 may overcome this problem. WA is an export-oriented State. Reducing costs and reaching for efficiencies of transport must be explored to ease the cost-of-living pressures. The Auditor General in 2012-13 presented a report which estimated that there was an overdue expenditure of $687m on road and bridge maintenance in the Tier3 regional zone, again during the course of the Barnett-Grylls government. The Cook Labor Government’s decision to open up review of the strategic rail network, and the Liberal Party’s estimate that it would cost $5 billion to upgrade the lines, as reported in The West Australian (January 24, 2025) can be taken with a pinch of salt. This is judging by its past performance of ineptitude extracting value from the State’s assets and realising asset productivity from the State’s rail lines. The decision to sell the lines was a poor decision. Also, not totally unforeseeable. Much has changed in the past two decades. The grain industry has increased production to mid-20 million tonnes. Iron ore production is no longer limited to the North West. The most economical means in the transport economy are essential. But paramount is road safety. The need to reduce the published death toll and published and unpublished serious injury on Wheatbelt roads ranks at a very high level against international standards and is practical evidence that Wheatbelt roads, in the absence of rail, are not fit for purpose for the heavy road haulage they must carry. The decision to reopen dialogue on the grain freight network is a good one. Currently the approximate 5000km of lines are controlled by a major national grains competitor, CANADA, through Arc, a subsidiary of Brookfield. Max Trenorden and Philip Gardiner are former National MPs. Mr Trenorden served in the Lower House from 1986 to September 2008 and in the Upper House from 2009 to 2013. Mr Gardiner served in the Upper House from 2009 to 2013.