An independent research report about the new inter-city train fleet, published in 2016, raised questions about whether the promise of jobs for Central Coast locals at the Kangy Angy Rail Maintenance Facility would be delivered.
According to the Parliamentary Secretary for the Central Coast, Scot MacDonald: “The $300m investment in the maintenance facility at Kangy Angy is expected to create 300 positions during construction, and 200 positions in operation, for the Central Coast.
“During construction, there are opportunities for traineeship and apprenticeship programs to provide on the job training and create much needed jobs for locals.
“Once built, the operation of the facility will also include ongoing apprenticeships, internships, local workforce hire and work experience placements via engagements with local universities, TAFEs and other colleges,” MacDonald said.
In 2016, the Australia Institute published a briefing paper called, Penny Wise and Pound Foolish, regarding the procurement of the new inter-city rail fleet from South Korea.
The report said that the $2.3b contract with Korea’s Hyundai Rotem, and Japan’s Mitsubushi Electric, included “an unspecified sum to cover maintenance of the double-decker cars over an initial 15-year period”.
According to the report, Australia’s free trade agreement with South Korea “could even allow the import of Korean workers to perform maintenance work on the passenger cars for many years after their purchase.
“That FTA contains pioneering provisions which liberalise entry to Australia for Korean workers employed by foreign firms doing work in Australia,” the report said.
“Korean companies can transfer specialised Korean employees to their Australian operations, without numerical restriction, for periods up to two years for each worker and up to four years for senior managers.
“Transfers of Korean contractors and service suppliers are allowed for up to one year each.
“There is no labour market test required to ensure that the work involved could not be provided by Australian workers.
“Once a Korean employee reached the time limit for their work in Australia, the employer could simply replace them with another Korean employee, and the time clock would start over again.
“This provision would allow the Hyundai consortium the opportunity, with minimal government oversight, to bring Korean workers in a wide range of skill classes to Australia to perform work related to the contract.
“This would likely include work associated with the 15-year maintenance agreement, which could constitute close to half of the total $2.3b contract.
“Not only is the direct manufacturing work being allocated to Korea, therefore, but so too may a significant portion of the follow-up maintenance and service work.”
The Australia Institute Report recommended that the NSW Government place a hold on the contract in question, and undertake a comprehensive, public, and transparent economic and financial analysis of the “costs and benefits of sourcing this important work domestically versus offshore”.
The recommendation was ignored by the NSW Government.
Member for The Entrance, Mr David Mehan, said he would be asking questions on notice when NSW Parliament returned, about whether jobs at the Kangy Angy maintenance facility would be going to locals or Koreans.
Following receipt of additional questions to Parliamentary Secretary for the Central Coast, Scot MacDonald, about the 2016 report, Transport for NSW replied in writing.
“The New Intercity Fleet Maintenance Facility will be run by RailConnect, which is a joint venture between Hyundai Rotem Company, Mitsubishi Electric Australia and UGL.
“UGL, which is a strong and proud local employer, is responsible for the maintenance of the trains at the New Intercity Fleet Maintenance Facility.
“Once operational, the facility will create around 300 local jobs, including apprenticeships and traineeships.”
A quick search on the internet reveals that UGL does not have an office on the Central Coast.
Mr MacDonald said: “It is also important to report that no Australian rail fleet manufacturer placed a bid to build the new Inter City Fleet”.
Briefing paper, Aug 2016
Jim Stanford, Australia Institute
Interview, Aug 2
David Mehan, Member for The Entrance
Media statement, Aug 6
Transport for NSW Media
Jackie Pearson, journalist