Crof proposes 6-monthly review of fuel levy

Operators need more consistency ALAN PEAT HIKES IN the “energy levy” by Spoornet (the fuel levy so termed because it covers both diesel fuel and electric energy used for trains) are becoming too frequent, and the Container Rail Operators' Forum (Crof) has called for a six-monthly review to be put place. The latest energy levy was on July 24, when Spoornet increased it from May 17’s 0.496% to 1.294% of rail costs. “This will add a further cost to each container movement between the main centres,” said Safcor Panalpina’s senior freight auditor, Jeff Epstein. With figures based on the standard railage rates for containers between Durban and City Deep in Johannesburg, a light 20-foot (6-metre) box faces a R12/unit increase and a heavy 40-ft (12-m) one of R40. And this week, petrol and diesel prices have both shot up – which can be expected soon to add more to the Spoornet fuel cost and levy. This sort of frequency is not good for those in freight movement, according to Peter Lewin, director of MSC Logistics and chairman of Crof. “You get cargoes caught in the middle when the levy increases,” he said. “And this is an extra cost we can’t recover.” There’s a need for more consistency in the rates, he added, with a period allowing local cargo shippers to alert foreign buyers to potential cost increases on fixed dates. And this period, Lewin added, had been assessed by Crof at every six-months. “We’re waiting for Spoornet to come back to us on this proposal,” he told FTW. The scheme is quite feasible, according to Epstein. However, he feels that a six-monthly levy adjustment might make each hike just a bit too significant. “I think a quarterly adjustment would be more manageable,” he said. Colin Schultz, distribution manager of major shippers, SANS Fibres, agreed with this assessment. “A set period between levy increases would mean less frequent adjustment in your administration procedures,” he said. “And, if we got a month’s notice as well, it would be a great help.” But he also thinks that every three months would be a preferable distance apart, he told FTW – although he added that the month’s notice idea might fall foul at Spoornet. “Their communication of anything is quite abominable,” Schultz said, “and asking them for a notice period would probably be expecting too much.” Lewin was also in agreement with this statement. Crof has tried at a number of meetings with Spoornet executives to get them to give major rail users more warning of hikes in the current levy adjustments. But the forum has now presented its concept of a 6-monthly levy revue to the railways management – and hopes for more success with this appeal.