Spoornet and customers clash over rate increase

ALAN PEAT AFTER A series of “highly co-operative” meetings with Spoornet, the Container Rail Operators’ Forum (Crof) has had an unco-operative get together with the railways’ senior management, according to Crof chairman, Peter Lewin, logistics director of MSC Logistics. The items on the agenda included the finalisation of the rail contract for the 2005/06 year, the service level agreement, the sectorial agreement and the 1.5% rate increase by Spoornet – announced on September 16 and effective October 1. The first three items went as planned, but debate on the rate increase was rather acrimonious. The plan of action put into place covered the finalisation of the rail contract before the end of October, and the conclusion of the service level by the end of November. “We are expected to officially sign the sectorial agreement during October,” said Lewin, “as an agreement of intent between Spoornet and the intermodal industry.” The disappointing part of the meeting, however, related to the implementation of the 1.5% rate increase. “While it was felt that the increase itself could be justified, the application thereof is not acceptable,” Lewin said. The point was made that Crof was unhappy with Spoornet publishing an increase to all clients without having any dialogue with the forum prior to the announcement. “This action contradicts the agreement that we have with Spoornet where the collaboration policy would be applied,” Lewin added, “and that Crof would be included in any developments prior to them being made public.” The forum also objected to the short notice period being given - stating that they require at least a calendar month’s notice for any increases. This because a large percentage of the traffic to be railed has already been shipped and is en-route to SA - with all costs prepaid. “Neither ourselves nor our clients would now be able to recover any additional costs,” Lewin said. “Even though Spoornet CEO, Siyabonga Gama, apologised for the short notice and confirmed that he would ensure that this would not happen again,” Lewin said, “he was not prepared to extend the notice period to the calendar month that we requested."