Chance considers private sector saleyard ownership

26 Jun, 2002 10:00 PM
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DOUBT surrounds the ownership of the Midland saleyard replacement facility after the release of an independent report by the Agriculture Department last week.

The final draft of the report into the relocation of the Midland saleyard revealed the State Government may allow the job of building a replacement facility to fall into the hands of the private sector.

Agriculture Minister Kim Chance was forced to disclose its details after National Party MLC Murray Criddle asked to see it during an Agriculture estimates sitting.

The release date for the report had not been set but calls to see it prompted a decision by Mr Chance to make it widely available for public scrutiny.

Within it, questions were raised whether it was appropriate for the State Government to own and operate the replacement facility.

All other state saleyards, except for one in the NT, were owned and operated by local shire councils or private interests, which cast doubt over the need for a statutory body to control the new facility, according to the report.

The need to relinquish the Midland site provided the opportunity to "encourage wider interest and competition in establishing and managing future facilities to replace the Midland saleyards".

But the State Government had an obligation to assist establishing a new facility because the existing saleyards were being forced out of the area under redevelopment plans.

The impact on saleyard fees was considered as part of the question of government ownership of the new facility.

Cost benefits enjoyed by private owners from government assistance could result in lower fees, but under-pricing would be detrimental to regional facilities, according to the report. It was also likely to "crowd out" any private investment in saleyards.

But with an estimated 2.9pc return per annum on the proposed $13.5m multi-species facility at Muchea, the government would need to make "significant increases" in saleyards fees.

"If owned and operated by the State Government, they would need to charge commercial rates to service depreciation and a return on investment."

The new facility would be designed to meet the National Saleyard Quality Assurance Scheme, which was expected to provide a competitive advantage over other saleyards.

Report findings

€Cost efficiencies from the establishment and operation of a single multi-species facility offset transport cost advantages of a separate cattle facility north of Perth and sheep facility east of Perth

€A single multi-species facility site north of Perth is preferable to reduce truck movements on Great Eastern Highway and minimise travel costs and changes to current staffing arrangements at Midland

€Increased transport costs outweigh benefits of regional development of the Moora proposal

€The new facility should be scaled down (especially sheep) due to trends toward direct selling from farms

€There was no need to build replacement pig facilities

€There was a need to upgrade other existing saleyards to meet national quality assurance standards, and

€Further consideration needed to be given to vehicle movements associated with the new facility to assess the impact on secondary roads and communities.

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