Regional rail freight – rationalising the debate

 Adjunct Associate Professor Ian Gray

Adjunct Associate Professor Ian Gray

Australians like trains, but their governments seem not to. At least the Commonwealth and States, that is. Many local councils would like more train services, but have not been in a position to obtain them. Since undertaking a research project on regional passenger trains for what was then the New South Wales Local Government and Shires Associations 10 years ago, I have been working with and near local government in its attempts to investigate and promote rail freight. They have made progress, but it has been slow and very difficult to achieve.

Freight passing Old Junee

Freight passing Old Junee

The present Federal Government seems much more interested in roads, especially very expensive urban tunnels and interstate motorways. Since establishing a national railway infrastructure authority, the Australian Rail Track Corporation, basically for the more lucrative lines and providing some funding for upgrades, the Federal Government has not greatly increased its involvement. Our state governments have been divesting themselves of their freight railway systems since the 1970s, when the Tasmanian and South Australian systems went to Commonwealth administration, and since then through privatisations. Privatisation has not turned around the historic decline in regional rail, particularly non-bulk freight. Some train services have done very well, but the decline has been most severe in south-eastern Australia. Tasmanian rail freight is now back in the hands of the State government.

The idea of moving freight by train is popular. It is also easy to romanticise, as railways are, often nostalgically, in popular media. From a cold, rational perspective also, railways are a desirable means to move freight. They have relatively low operating costs. In simple economic terms, the dollar cost of operating  an equivalent service by truck can be double that of operating a train (CRA International (2006). In terms of externalities like safety and environmental costs, road freight costs have been calculated to be more than 6 times greater than rail in urban areas and 10 times greater in rural areas (Laird 2005).

The costs of not having an efficient regional rail freight system are borne heavily at the local level. And local councils know it. Many times I have read councils’ submissions to State and Federal governments on freight issues, and worked with council representatives on submissions. The level of distress caused by the loss of rail freight services has been noticeable. This is often due to rising road maintenance costs amid diminishing local budgets, but is also related to environmental and safety concerns.

While the idea of the freight train is popular, it can also be readily dismissed in the public mind. Australia’s well-known and, in a few situations, persistent differences in track gauge between States are often referred to unreasonably as condemning the future for trains. The obvious point that trains are constrained by their necessity to run on tracks, and tracks can’t take trains everywhere, is another explanation offered for the decline of rail freight. This argument is misleading because rail has never moved all of its freight all the way from origin to destination. Other modes have always participated in transportation; the task is shared. The issue is about creating the conditions in which the sharing is balanced. That is, the relative tasks undertaken by rail and road make greatest use of the advantages offered by both at least overall costs, including external costs like impacts on safety and the environment. The history of Australia’s railways is easy to misunderstand, especially when public debate turns into an adversarial slog between supporters of trains and trucks.

Freight Train

Freight Train

Supporters of rail are also frustrated by the distance mantra: trains have to move freight over long distances for railways to be economically viable. Even the rail industry does little to counter this narrow view. Certainly the viability of a train service is increased the further it travels, as the efficiencies of rail outweigh the cost of transhipment from trucks. But the viability of a railway line is determined by the density of traffic which flows along it. Building volumes of rail freight can be done at the local level, with benefit to the locality in terms of industrial development and other localities by improving the viability of rail freight through a region. Coordination among localities is necessary, and local councils have proved capable of this work.

We still have the kinds of locally-based rail freight industry which can become involved quickly in rail development. The Ettamogah Rail Hub near Albury ( and Wakefields Transport at Merbein ( both offer integrated rail freight services. These local businesses have not been discouraged either by government reticence or by popular misconceptions about the alleged problems of railways.

I was pleased to put some of these ideas to a seminar at our Thurgoona Campus in September, and find support for them among members of the rail industry and local government. This followed our very successful seminar held at Blayney last year when 120 people listened to a Canadian keynote speaker and representatives of the Australian transport industry and local government. We are now developing our research and communication to address more of those popular, and apparently politicised, misconceptions about rail freight.


CRA International (2006). Two Case Studies on Road vs. Rail Freight Costs, report prepared for Pacific National Limited. Sydney.

Laird, P. (2005) Revised land freight external costs in Australia. Research Online, University of Wollongong, Wollongong.


About ilwscsu
The Institute for Land, Water and Society is one of four Centres of Research Excellence within Charles Sturt University, Australia. Its principal focus is on integrated research which contributes to improved social and environmental sustainability in rural and regional areas.

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