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Tuesday, January 17, 2006

Talks fail to solve rail crisis

The Mercury: Talks fail to solve rail crisis [18jan06]

A SOLUTION to Tasmania's rail crisis is still probably weeks away following talks between the state and federal governments and rail operator Pacific National yesterday.

The much-anticipated meeting failed to provide an immediate breakthrough, with Pacific National still to agree to the terms of a $118 million government rescue package.

But State Infrastructure, Energy and Resources Minister Bryan Green said the meeting, held in Melbourne, agreed to a tight time frame for an agreement to be negotiated over the next few weeks. He said he was satisfied with the outcome.

A spokeswoman for federal Transport Minister Warren Truss, Kylie Butler, said the meeting was constructive, and rail freight services were expected to continue while the agreement was being considered.

"Basically, we are waiting for Pacific National's decision," she said.

Yesterday's meeting stemmed from an urgent request from transport heavyweights Toll Holdings managing director Paul Little and Patrick Corporation chief executive Chris Corrigan almost a fortnight ago.

Mr Truss has previously aired his annoyance at the length of time taken by Pacific National, a joint venture between Toll and Patrick, to agree to the package, after the company initially threatened to freeze freight services unless the governments met its deadlines.

The rescue package also met Pacific National's requests but has not gained instant approval from the company.

A bitter takeover battle between Patrick and Toll is thought to have hindered discussions, with Patrick this week beginning proceedings against Toll in the Victorian Supreme Court.

Although it had previously indicated in-principal support for the package, Pacific National's warring board did not make a decision at its December meeting, saying significant issues still needed negotiating.



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