PREPARED FOR MEMBERS

ROAD AND RAILINDUSTRY NEWSLETTER

• Join your industry network• Salary comparisons• State by state wrap

Welcome

Road and rail infrastructure projects drive economic activity and investment in engineering across Australia. Efficient and effective transport networks also ensure ongoing economic growth, job creation and limit crippling congestion costs.

In 2014-15 Australia’s investment in road projects totalled $15.9 billion, with another $5.1 billion in rail investment. Over the past decade, almost $170 billion has been invested in road and rail projects across Australia. Strong engineering capacity is vital in ensuring the best value infrastructure is delivered for taxpayer dollars.

Despite this massive investment of funds and the community reliance on safe rail and road infrastructure, government in-house engineering capacity continues to decline, driven mainly by outsourcing and departmental cost cutting. With project proposals increasingly generated by the private sector, the professional capacity for governments to evaluate the scope and design of projects needs to be rebuilt so that we know we are getting value and quality.

Australia’s considerable road and rail infrastructure agenda understandably attracts multinational corporations to bid for local projects. Whilst international firms bring expertise, it is critical they also provide employment opportunities for Australian professionals. The 2011 census reported that 45% of the engineering workforce was born overseas and at March 2015 there were approximately 4,800 engineering managers and professionals working in Australia on 457 visas.

Major upcoming investment in road and rail infrastructure and the high number of 457 visas in engineering at present both support the need for the registration of professional engineers. Registration ensures accreditation of qualifications and a commitment to a code of ethics and continuing professional development.

Professionals Australia will continue to provide a voice for professional engineers, to advance the standing of the profession and promote greater recognition of the critical contribution road and rail engineers make to the wider community.

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Industry NetworksRecently, Professionals Australia launched national industry networks for both the Road and Rail industries. The national industry networks are comprised of reps and members working in road and rail across Australia, providing an expert voice for their industries.

These networks inform the development of a comprehensive industry narrative, enabling informed advocacy to industry leaders, employers and government and the development of strategies to advance members interests.

Recent rail and road industry network meetings identified key issues to be addressed, including:

• Inadequate funding for asset maintenance –the pressure to invest in new infrastructureresults in governments not budgetingadequately for maintenance of existingassets;

• Restructuring and uncertainty for industryprofessionals – financing pressures, theincrease in market led initiatives, and assetrecycling schemes are driving restructuringof departments and uncertainty forprofessional staff;

• Increased outsourcing of governmentengineering capacity – governments arelosing their capacity to act as informedpurchasers, increasingly outsourcing scopingand design works; and

• Engineer registration – The registration ofengineers will ensure that community safetyis protected by guaranteeing engineeringwork is undertaken by qualified engineerswho are committed to a professional codeof ethics and continuing professionaldevelopment.

To be part of a National Industry Network contact:

Rail Industry Coordinator:

Sharelle Herrington sherrington@professionalsaustralia.org.au

Road Industry Coordinator:

Paul Davies pdavies@professionalsaustralia.org.au

STATE PROJECT COST

NSW WestConnex $16.8 billion

NorthConnex $3 billion

Sydney Metro $11 billion

QLD Cross River Rail $5.2 billion

Bruce Highway $8.5 billion

Morton Bay Rail Link $988 million

VIC Melbourne Metro Rail $10.9 billion

Western Distributor $5.5 billion

SA Goodwood & Torrens Rail Junctions $110 million

South Road Upgrade $896 million

WA Gateway WA $1 billion

ACT Majura Parkway $288 million

TAS Midland Highway Upgrade Program $500 million

NT Tiger Brennan Drive Duplication $103 million

The significant cost of major road and rail infrastructure underlines how critical these industries are to the Australian economy. Effective transport infrastructure limits the economic loss associated with congestion, drives job creation, and provides the foundation for a fast-growing, high-employing nation.

A snapshot of the current major projects across each state provides a glimpse of the investment that governments are making in order to keep Australians on the move. The scale of the investment highlights the importance of getting our infrastructure spending right.

Source: National Infrastructure Construction Schedule

Major Australian Road and Rail Projects

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GRADUATE ENGINER SENIOR ENGINEER

Rail

Road

The following rates are the indicative agreement rates at each employer. The graduate rate is the rate at which an individual with a four-year professional engineering degree would be initially employed.

The senior engineer rate is the top rate that an individual can achieve through an enterprise agreement negotiated by Professionals Australia, excluding senior executive roles. Employers have mechanisms to remunerate senior engineers and managers above these agreement rates and these vary significantly between states.

Salary Comparisons: Graduate Engineer Rates and Senior Engineer Rates

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GRADUATE ENGINER SENIOR ENGINEER

SENIOR ENGINEER GRADUATE ENGINER

TRANSPORTENERGYTELECOMMUNICATIONSWATER

$ MIL

LION

S

Figure 1: Value of major infrastructure work done in Australia

Source: BITRE Australian Infrastructure Statistics 2015

Figure 2: Source of transport infrastructure funding by state 2005-06 to 2014-15

COMMONWEALTH PAYMENTS TO STATE GOVERNMENTS

STATE GOVERNMENT FUNDING

COMMONWEALTH PAYMENTS TO LOCAL GOVERNMENTS

Source: Grattan Institute, Roads to riches, April 2016

Road and Rail

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RoadAustralia relies heavily on its road network for both passenger and freight transport. Road provides the primary means of transport for much of the population, while road freight dominates non-bulk freight markets. Major road investment remains a high priority for governments across Australia, and is typically well supported by voters. As a result, investment in roads is strong, with engineering construction work on roads across Australia totalling $15.9 billion in 2014-15¹.

However, the Australian Infrastructure Audit suggests that congestion on roads cost the nation $13.7 billion in 2011². This demonstrates that more work needs to be done in order to reduce the drain caused by congestion. Encouraging proactive and well-planned investment will be the key to ongoing growth in infrastructure-reliant industries and the economy as a whole. Despite the importance of road networks and the pressing need for greater investment, overall spending on roads declined by 4.3% over the past year. More significantly, spending has declined by 19.8% or $4.0 billion since 2011-12.

¹ Bureau of Infrastructure, Transport and Regional Economics, Australian Infrastructure Statistics – Yearbook 2015, December 2015

² Infrastructure Australia, Australian Infrastructure Audit, May 2015

Figure 3: Value of engineering construction work done ($ millions)

Source: BITRE, Australian Infrastructure Statistics – Yearbook 2015

Rail Investment in rail has also fluctuated over the past five years, with government policies around rail investment varying across the nation. While the Federal Government appeared to favour road projects, state governments provided some investment in an effort to reduce the strain on roads. Engineering construction work done on rail totalled $5.1 billion in 2014-15, down 22.0% on the previous year, representing a major slowdown in investment.

Over the past five years, there has been only minor expansion of capital city passenger rail networks. These have included minor extensions to existing lines in order to cater for the urban sprawl around major capitals and level crossing removals, with these projects supporting both rail and roads. Melbourne’s proposed Metro Rail Project is also a sign that Australian public transport systems may yet embrace rail systems as a means of supporting cross-city travel.

Rail networks have benefited somewhat from investment in freight lines, driven by the growing popularity of rail-freight and increased congestion on roads. While road-freight transport still dominates the logistics sector, the need for efficient networks to transport bulk-freight - such as mined commodities - has encouraged investment.

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Figure 3: Value of engineering construction work done ($ millions)

Source: BITRE, Australian Infrastructure Statistics – Yearbook 2015

OutlookThe strain on Australia’s road and rail networks is expected to increase over the coming years, necessitating further investment. The population – particularly around major capital – is forecast to grow, driving greater congestion and higher travel times. The rising population will also place further pressure on public transport, especially during peak travel periods. The national freight task is also expected to grow, putting more trucks on the road and crowding rail networks. While road and rail will undoubtedly face significant challenges over the coming years, these challenges raise excellent opportunities for growth.

Governments at all levels have recognised the need to improve road networks, reduce bottlenecks and take freight traffic off suburban roads. This has encouraged a number of major projects, with more proposals in the pipeline. IBISWorld forecasts road and bridge construction to increase by an annualised 2.9 per cent over the next five years as several major projects come on line3. IBISWorld points out several large-scale projects in New South Wales and Queensland, which are behind much of this growth.

Project selection and funding Improvements in road and rail networks are integral to economic growth and quality of life. Governments across the political spectrum generally agree on the importance of infrastructure, and have supported the push for more major projects. However, major infrastructure decisions have become increasingly political over the past decade, with political groups often disagreeing over cost, funding methods and which major projects should be supported.

Major infrastructure projects - such as roads and rail - will often run at an operating deficit, making funding and cost even more significant. In order to satisfy voters and avoid media criticism, governments are required to deliver major projects, with clear economic benefits, at as low a cost as possible.

A key avenue in achieving these ends is the use innovative funding methods. The sharing of investment and risk between government and private parties can significantly reduce the up-front cost of major infrastructure projects, often making such investment more palatable for voters.

Toll roads are one avenue through which this might occur, with private toll-road operators contributing a portion of the initial investment in exchange for the right to charge tolls once the project is completed. While major government investment remains integral to the delivery of key infrastructure, private investment may provide a means to increase this investment. Governments are also likely to look at how they can tap into additional investment from superannuation and how they may be able to capture some of the additional land value created by infrastructure through taxes.

While the future of infrastructure spending looks strong, the challenge for governments at all levels will be to place the needs of the community above political motivations when managing the nation’s road and rail networks. The introduction of independent infrastructure advisory bodies at Federal and State levels is likely to improve this process over the coming years, with most groups expected to release infrastructure plans and priority lists, boosting the credibility of included projects.

3IBISWorld, Industry Report E3101 - Road and Bridge Construction in Australia, January 2016

WORKPLACE ADVICE and SUPPORTYour membership with Professionals Australia gives you access to our Workplace Advice and Support (WAS) service, provided by a team of skilled industrial lawyers. The WAS team can help you with workplace and industrial relations advice, support and representation.

Performance Management – What should I do? In this edition of Industry News, Michael Butler, Director of Industrial Relations gives advice on what to do if you are subject to performance management at your workplace.

Members often approach the WAS Team when they are being performance managed. This is usually a time of uncertainty and stress and if this happens to you, you should seek urgent advice from the WAS team.

What is the Process? Performance Management can take a number of different forms, but most importantly, the process should be procedurally fair. Essential elements of a fair process should include:

• The alleged shortcomings should be in writing and be directly related to the performance goals for the relevant year;

• The alleged under performance should be clearly defined and easily understood;

• In addition, the alleged underperformance should be the clear responsibility of the individual employee and not someone else; and

• That the individual employee has the opportunity to ask questions and seek further clarification and/or dispute the alleged shortcomings.

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It is common for allegedly underperforming employees to be placed on Performance Improvement Plans (PIP).

A PIP should include:

• Clear, realistic and measurable performance objectives;

• An opportunity for the individual employee to undergo additional training when a skills deficit is identified;

• The provision of additional resources or revision of duties in order to assist in facili-tating the required improvement; and

• A capacity for the performance objectives to be reviewed if it becomes clear that the performance objectives are not capable of attainment.

The above is not an exhaustive list and members should contact WAS if they feel that what they are being asked to do is unreasonable.

I’m feeling bulliedIt’s important to recognise the difference between legitimate Performance Management and Workplace Bullying.

The PIP process can often involve the regular monitoring of performance this more intense focus may be interpreted as a form of bullying. This may or not be the case depending on the circumstances of the employers conduct. Legitimate performance management is not bullying. However, employers do need to be reasonable in exercising their right to encourage change. If you feel that you are receiving unreasonable treatment – contact the WAS team for support and advice.

What types of issues do Road and Rail Members seek help with?

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10% RESTRUCTURE /

RECLASSIFICATION

17% TERMINATION / REDUNDANCY

22% CONTRACTS

18% PERFORMANCE /

REVIEWS33%

OTHER MATTERS*

* Other matters may include advice on the terms of an Award or EBA, support with unfair termination, queries on leave entitlements etc.

What are Performance Improvement Plans (PIPs)?

State by State Updates

VICTORIA

The unions and management completed bargaining negotiations and reached an in-principle agreement on the new enterprise agreement at VicRoads in February 2016. Negotiations are currently ongoing for new enterprise agreements at VicTrack, V/Line and Metro Trains (Infrastructure).

QUEENSLAND

NEW SOUTH WALES

Negotiations for a replacement determination at the Department of Transport and Main Roads have formally commenced and provided much needed urgency to organising conversations in the department.

Award negotiations for Roads and Maritime Services and Transport for NSW have started. With the unprecedented government spend on transport infrastructure, including WestConnex, NorthConnex, the Pacific Highway upgrade, Sydney, Parramatta and Newcastle light rail and the Sydney metro, we need to see better investment in the professional workforce.

Members have identified new or improved professional engineering classification systems, budget allocations for continuing professional development and adoption of RPEng as the main features of our claims.

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SOUTH AUSTRALIA

A new focus on professional capacity is planned in order to expose the fallout from the ongoing restructuring at DPTI, to once again build an accurate picture of the engineers working for DPTI. Morale is at the lowest seen in the department and members have seen trust and respect for their employer completely dissipate.

WESTERN AUSTRALIA

Main Roads continues to restructure its departments to provide a more “business focussed and corporate culture.” This is causing some distress with workers, however to date, there have been no direct job losses. At the Public Transport Authority (PTA), engineering positions and capacity are under threat from state budget cuts, involuntary redundancies, stringent wage policies and a state-wide freeze on public sector roles.

TASMANIA

A.C.T.

The current deal is in effect until 2017, with a roll-over deal having been put in place.

Members in Roads ACT and TAMS will begin negotiations for their new enterprise agreement later this year. Movement across to the new Infrastructure Officer/Manager classification, which was negotiated by PA under the current agreement is virtually complete for members in Roads ACT but con-tinuing for other eligible members in other parts of TAMS and ACT Government.

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