Oct 23, 2008

Transport Charge & Road Charges Amendment Bills



Second Reading

Mr ALBANESE (Grayndler) (Minister for Infrastructure, Transport, Regional Development and Local Government) (10:58 AM) —in reply—I thank members for participating in the debate. In order to save the time of the House, I will sum up both bills at once but I will deal with them separately. Firstly, I thank the opposition for supporting the Interstate Road Transport Charge Amendment Bill (No. 2) 2008. The purpose of that bill is to amend the Interstate Road Transport Charge Act 1985, which imposes registration charges for heavy vehicles registered under the Australian government’s voluntary Federal Interstate Registration Scheme. The bill also allows regulations to be made to specify heavy vehicle charges for application to FIRS vehicles. The FIRS is a registration scheme that covers only about three per cent of Australia’s trucks. The rest are covered by state and territory schemes. All of the states have imposed the new charges since this 1 July this year. It will enable the implementation of the registration charge elements of the 2007 heavy vehicle charges determination which revises national charges for heavy vehicles and trailers for application to heavy vehicles registered under FIRS.

The determination was agreed to by the Australian Transport Council in February 2008 and was implemented by the states on 1 July 2008. It is self-evident that it is in Australia’s economic interests for registration charges for heavy vehicles which regularly trade across state borders to be consistent. That is why earlier this year we introduced legislation along these lines. It is unfortunate that we have had a period of imbalance in the charges, but unless this legislation is carried there could potentially be a distortion whereby there is an economic incentive to register vehicles under the federal scheme rather than under the respective state and territory schemes. This is common sense. It has taken a little while to get there, but I am pleased that we have got there and I commend the bill to the House.

I now make some comments on the Road Charges Legislation Repeal and Amendment Bill 2008. The bill repeals the Road Transport Charges (Australian Capital Territory) Act 1993 as well as making heavy consequential amendments to the Road Transport Reform (Heavy Vehicle Registration) Act 1997 to remove links to the former act. This will allow the ACT government to set its own registration charges consistent with the registration charges adopted for FIRS and in all the other jurisdictions. The bill also amends the Fuel Tax Act 2006 to set the road user charge rate at 21c per litre in line with the 2007 heavy vehicle charges determination. Truck operators do not pay fuel excise in the way that other motorists do. Like all motorists, they pay 38.14c per litre at the bowser for their fuel; however, they receive a fuel tax rebate of 18.51c per litre. The balance, currently set at 19.63c per litre, represents the road user charge. The current charge was established in a determination issued in 2000 and has not changed since then.

Road funding by all levels of government has increased by 33 per cent since that time. This increase is necessary to ensure that heavy vehicles pay their fair share of road construction and maintenance costs. The National Transport Commission estimates that in 2007-08 heavy vehicles underpaid their fair share of road costs by $100 million. This bill will give us cost recovery—nothing more and nothing less. It is important to emphasise that this is based upon costs that have already been incurred. So this is a cost recovery of government expenditure which has benefited heavy vehicle road users. Those in the heavy vehicle industry are very clear that they wish to pay their way. It does not index the charge. The bill’s amendments to the Fuel Tax Act establish a mechanism to allow adjustment of the road user charge by regulation. These regulations would be subject to review by the parliament in the normal manner. It is important that that be understood. I am pleased the shadow minister is nodding in agreement at that understanding of the legislation and the way that it works because there has been some confusion in this debate about these issues.

The opposition’s proposed amendment redefines a range of new restrictions on how it is adjusted, including a number of provisions that they have asked for: that an average of 50 heavy vehicle rest areas be constructed each year on the AusLink national network; that Infrastructure Australia certifies that the rest area construction has or will have occurred by the time the new road user charges are due to take effect; that the transport minister releases the proposed determination package, including the calculation mechanism for a 60-day period of public consultation and has regard to the outcomes of this process; and that road expenditure used in the determination must be verified by auditors-general of the respective jurisdictions.

The government does not need legislation to commit to rest stops. The government identified rest stops as an important issue for the industry and moved to act. We were asked for two changes before I went to the Australian Transport Council for determination. The requests were, firstly, a delay until 1 January 2009—the government agreed to that—and, secondly, funding for a heavy vehicle safety and productivity package. The government responded positively to that also. The government has already committed in the passage of this bill to a $70 million heavy vehicle safety and productivity package which will provide heavy vehicle rest stops to the industry over the forward estimates. We amended the AusLink bill to allow specific funding for rest stops. It has never happened before. For 12 years under the previous government it did not happen, just as, from what we can find from a survey of Hansard, transport ministers in the previous government never once mentioned rest stops in this House.

We have put heavy vehicle rest stops on the political agenda of this parliament. And to proceed with our commitment we require this legislation to be carried. I have already written to industry seeking their views as to where the rest stops should be. Those submissions have been provided. All we need for this process to commence is the passage of this bill, which will facilitate their funding. However, it is bad policy to link adjustment of the charge in the future to the construction of an arbitrary number of rest stops alone. Governments expend resources on all manner of road construction and maintenance projects, not just rest stops. How do you define what a rest stop is? A rest stop can be something that costs very little money or it can be a full-scale rest stop with showers and toilet blocks and space for a large number of trucks. Whilst I do not question the need for rest stop issues to be addressed, the opposition’s amendment, in the way that it is framed, is simply impractical and I have indicated also to the Australian Trucking Association that the framing of their suggestions is impractical.

It also does not understand what Infrastructure Australia is for. I call upon the opposition to consult the Infrastructure Australia legislation. Infrastructure Australia is there to deal with nationally significant infrastructure. The board of Infrastructure Australia is not there to go and examine and audit the construction of heavy vehicle rest stops. That is not what the advisory council was established for, and they should know that that is the case. IA’s purpose is to give high-level strategic advice to the government on its infrastructure agenda. It is made up of eminent business people and public sector officials with significant public policy experience. There are other bodies better placed to count rest stops; namely, the actual jurisdiction-based heavy vehicle regulators.

In relation to the adjustment of the charge, the government gives a commitment that any adjustment to the charge should be preceded by a transparent process so that industry has confidence in what it is paying and how it has been calculated. What better and more transparent process for adjustment can there be than scrutiny by this parliament? The opposition leader says that he supports the principle of cost recovery but not automatic indexation. This bill delivers cost recovery and nothing more. Truck operators will continue to get a rebate, meaning they pay only 21c per litre. If the opposition is satisfied with the decision of the government not to include indexation provisions within the Interstate Road Transport Charge Amendment Bill but instead to allow adjustment to be made by regulation, what then is the issue with adjustments to the Fuel Tax Act?

We listened to what the opposition argued when a different version of this instrument was put to the parliament earlier this year and we have attempted to accommodate any reasonable points that have been made. The shadow minister spoke extensively about the variations in fatigue laws, loading limits and network access regimes that exist between the state jurisdictions and described how these variations are a impediment to an efficient industry. He then claimed this bill should be used to force the states to adopt uniform laws. The Rudd government certainly agrees with the shadow minister that these variations are a problem for industry. In fact, governments have agreed with that proposition since 1991 when the National Road Transport Commission was established by the Hawke government. That is why the Rudd government is pursuing this through COAG and the ATC, which will be meeting again in two weeks time for the fourth time since February, making sure that we keep the pressure on to get this reform agenda through. A national jurisdiction for heavy vehicles so that there would be one set of laws would be a substantial improvement and should enjoy the bipartisan support of this House.

But the problem is that the opposition amendment does not impact on state funding at all. It only impacts on Commonwealth funding. So there is no pressure on the states in this legislation if it is not carried. It will just mean less Commonwealth revenue and therefore less money to be able to spend on issues such as road safety and rest stops. It does not give the Commonwealth any bargaining power over the states to adopt uniform laws. The government does not support the amendments because they are unnecessary and they will not deliver the benefits to the industry that the Leader of the National Party claims that they will.

These bills modernise charges for registration and road user charges applicable to the heavy vehicle industry. It is important that the House acknowledge that this is a proposition that began under the previous government. In a speech given in June 2007 entitled ‘The coalition’s transport reform agenda’, the then federal Minister for Transport and Regional Services and Leader of the Nationals said:

The National Transport Commission will develop a new heavy vehicle charges determination to be implemented from 1 July 2008. The new determination will aim to recover the heavy vehicles’ allocated infrastructure costs in total and will also aim to remove cross-subsidisation across heavy vehicle classes.

That was their policy when they were the government. We are implementing that, taking forward in this legislation the determination that was asked for by the Howard government. However, the new charges—our proposal—will be fairer both to those in the industry and to the wider community. Importantly, the new charges deliver the requirement of the Council of Australian Governments for full and ongoing cost recovery. The new charges will encourage state and territory governments to facilitate access to the road network for higher productivity heavy vehicles, thereby gaining a substantial benefit to the economy. This, in turn, would make better use of the nation’s infrastructure. This is a key element of the Rudd government’s plan to raise productivity, fight inflation and maintain economic growth.

I commend the bill to the House.