The State Government is being urged to provide funding certainty for the Mode Shift Incentive Scheme (MSIS) to encourage more freight on to rail.

The MSIS is an incentive program providing financial support to rail freight companies to make the cost of transporting goods on rail more competitive.

The program was established by the former Liberal Nationals Government in 2014 with an initial commitment of $5 million a year over four years towards the scheme.

Since 2018, Labor has cut funding from the MSIS and is relying on a year-to-year funding model, with the program receiving $3.5 million funding in last month’s State Budget to continue operating until June 30, 2024.

Deputy Leader of The Nationals and Member for Lowan, Emma Kealy, said the MSIS program allowed regional rail freight operators to offer competitive transport options for exporters, encouraging them to use rail instead of road transport to get their goods to the Port of Melbourne.

Drip-Feed

“The drip-feed funding being provided by Labor does not provide the financial certainty required for businesses to commit to send their freight by rail,” Ms Kealy said.

“It is yet another perfect example of how wrong Labor’s priorities are when they refuse to commit ongoing funding to a program that is working in getting trucks off our dangerous and rapidly deteriorating roads, benefiting the entire community.”

Ms Kealy said she was aware of at least one large export company which made the decision to move its freight by truck due to a lack of certainty about ongoing funding for the scheme.

“This decision alone put an additional 3000 trucks per year on our roads through Horsham and on to the Western Highway to Melbourne,” she said.

“If Labor is genuine about moving more freight by rail instead of drip-feeding funding, the Minister will commit to recurrent funding for the MSIS to provide long-term certainty and encourage more businesses to choose rail, making our roads safer for all users.”

This article appeared in The Buloke Times, 6 June 2023.