Fixing Road Charging for the Trucking Industry

The whole issue of fixing road charging for the trucking industry pays in rego, or some other form of tax, is again up for discussion. The National Transport Commission has a discussion paper out at the moment asking for submissions from stakeholders about the way the trucking industry pays for the wear and tear it creates on our road system.

Currently, the NTC asks governments what monies they spend each year on road repairs and maintenance and then divvies the amount up between the different trucks and trailers using the roads. This gives them an amount of rego to be charged for each vehicle and a level of fuel subsidy. This is designed to come up with the figure originally given by governments.

This is an imprecise tool to get the job done. Government only seems to have a rough idea of how much is actually spent annually. They definitely don’t have a handle on how many trucks are on the roads and where they are. Then we have the individual states varying the amounts charged in rego, ignoring NTC recommendations, on a political whim.

As a result of this wonderful system, the trucking industry has been overcharged by government in the recent years, because the figures supplied to the NTC underestimate the number of trucks using the roads. This means the rego and road user charge recover more money than was actually spent on the roads.

There is also a time disconnect between the point at which the original road spending is calculated and when the revenue from the trucking industry comes into the government coffers. This is around two years, money raised this year raises the estimated amount from 2014, also not so precise.

The NTC has come up with a number of options, none of which will make the process that much more precise. There are some smarter ideas in the list, like paying for new assets over their useable life, rather than in the year they were built. Ring fencing the funds, so every dollar raised can only be used in the roads budget and nowhere else seems sensible.

Working out how much the government overcharged or undercharged the industry on an annual basis and adding in compensation in the following year’s charges is also an option. This sounds like a recipe for disaster. The imprecise nature of the estimated spending on roads and number of trucks using them will be further compounded by a time lag as the unders and overs are calculated and then levied on the industry a year later.

The NTC is looking for industry feedback on which options, or combination of options to follow. Submissions will need to be in by July 27. Proposals, laying out the future revenue raising criteria, will then go forward to the meeting of all of our Transport Ministers in November.

Submissions from our industry representatives will be there in the mix, as will those of the state authorities. You can forgive me for remaining sceptical about any really good solution coming out of the process. There is already too much imprecision in the process and this is likely to continue into the future. We might as well go with Option 6, continue to freeze revenue at current levels. At least we would cut down administration costs on the process.

Meanwhile, lurking in the background is the spectre of mass/distance/location charging. Getting charged for the roads you use, at the mass you run and over the distance travelled seems attractive. The bureaucrats in the Federal Government see this as the end game, but are holding back after their last attempt to develop a system found the whole idea too complex to contemplate.

The concept will come back again, especially when most trucks have some kind of black box fitted. By then the idea of government knowing how fast and heavy our truck is travelling on which highway will be normality. The difficult and lengthy task will be for the various governments involved to classify every kilometre of the road network and work out a precise charge.

The level of inaccuracy and time lag involved in the whole area of road charging makes it one of those impenetrable problems. Yet again, the trucking industry will be paying the bill and not having any idea whether we are getting anywhere close to value for money as we watch the road network slowly crumble and congestion mount.