International benchmarking report
This report was released on 28 April 1998. This study is part of a continuing program of research into the performance of economic infrastructure industries, which was commenced by the Bureau of Industry Economics. It is the third Waterfront Benchmarking report in the cycle.
The study builds on the two previous waterfront studies by providing new insights into timeliness, reliability and the economic consequences of failure to match levels of performance achieved overseas. It is based on data collected throughout 1997.
The study also provides a broad context for the Productivity Commission's companion study, Work Arrangements in Container Stevedoring, which examines selected work arrangements and assesses their implications for the performance of container stevedoring workplaces.
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- Media release
Two research studies were released today by the Productivity Commission: International Benchmarking of the Australian Waterfront, and Work Arrangements in Container Stevedoring. The first study finds that Australia is under-performing on the waterfront. The second shows how work arrangements constrain container stevedoring performance.
The two studies have involved detailed investigations and analysis covering a range of ports and stevedoring workplaces, and are based on extensive consultations over the past year.
International Benchmarking of the Waterfront
International comparisons of container stevedoring performance, for the same ships and trades, indicated that Australia's charges were generally higher, productivity lower and services less reliable than overseas. These disparities could not be explained simply by scale disadvantages.
The Commission found that, with the exception of bulk grain loading, other areas of traditional stevedoring also performed relatively poorly. And it found that marine service and port infrastructure charges were in total two to three times greater than at overseas ports, noting that only some of this reflects cost-recovery pricing in Australia.
Together with other problems in the transport chain, this under-performance not only results in higher direct costs to shippers, but also involves significant indirect costs from delays and unreliability which could be reduced.
Overall, the international benchmarking revealed significant scope for improvement in Australia's performance.
Work Arrangements in Container Stevedoring
Flexible work arrangements are especially important for Australian stevedores, given the variable demand for their services. The Commission found that despite some improvements in recent years, container stevedoring in Australia is characterised by a system of complex, inflexible and prescriptive work arrangements which constrain workplace performance.
Among the various work arrangements examined, three were identified as being of particular concern:
- the 'order' of pick, which prescribes the order in which permanent, supplementary and other categories of employees must be engaged for a shift;
- relatively high shift premiums and penalties; and
- high redundancy provisions.
These and other work arrangements act in combination to inhibit productivity, reduce timeliness and reliability, and increase labour costs for a given level of activity.
The Commission noted a number of factors have impeded change to more productive work arrangements, including:
- an adversarial workplace culture;
- strong union bargaining power facilitated, in part, by the high cost of industrial disputes; and
- limitations on competition in the industry involving high concentration of ownership and considerable barriers to entry, particularly through exclusive long-term leases to existing companies.
The Commission noted the Workpiace Relations Act facilitates change to work arrangements. Greater competition in container stevedoring would increase the pressures on management and employees to change work arrangements and improve performance on the waterfront.
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Copyright, Foreword, Contents, Abbreviations, Overview
1 About this study
1.1 Role of waterfront benchmarking
1.3 Report structure
2 The waterfront
2.1 Australia's international sea trade
2.2 Industry participants
3 Government and port management practices
3.1 Government involvement
3.2 Port management practices and policies
4 Marine services
4.3 Mooring and unmooring
Attachment 4A — Data
5 Port and maritime infrastructure
5.1 Government charges
5.2 Port authority charges
5.3 Combined port and maritime infrastructure and marine services charges
Attachment 5A — Data
6 Stevedoring — containers
6.1 Container stevedoring and terminal operations
6.2 Waterfront charges for container services
6.3 Container terminal productivity
6.4 Timeliness and reliability of container operations
6.5 Summing up
Attachment 6A — Net cranes rates at Australian ports between December 1989 and June 1997
7 Stevedoring — break-bulk cargo
7.1 Break-bulk operations
7.2 Benchmarking break-bulk stevedoring
8 Stevedoring — bulk
9 Stevedoring — cruise ships
9.1 Baggage handling
9.2 Stevedoring supplies
10 Port–land interface
10.1 Stevedoring operations
10.2 Land-side operations
10.3 Logistical co-ordination
Attachment 10A — Customs
Attachment 10B — Quarantine inspection
11 Impact of waterfront service performance on importers and exporters
11.1 Impacts of service problems
11.2 Direct costs
11.3 Indirect costs
A Participation in the study
B Data collection methodology
C Government involvement
D Port management practices and policies