Prepare to change the road user charge

Talking Turkey About Trucking

It looks like the game is up, the way trucks pay their way for the use of the country’s roads will change. For the trucking industry this is going to be a massive shock. The way we price jobs, the entire business model for some tasks will be brought into question.



Jay Weatherill, the South Australian Premier has set the cat among the pigeons this week by calling for the introduction of mass/distance/location charging for trucks on the highway.



“Under this plan, State-based registration and Federal-based fuel-excise charges are replaced by a charging system based on mass, distance and location, a system that reflects actual use of the road network,” said Weatherill. “The Federal Government then reinvests the revenue it earns from these charges into better planned and coordinated road infrastructure.



“Private sector investment could be leveraged into the road network, and the Productivity Commission raised this possibility as far back as 2006. In order to fully explore and test this proposition, South Australia would be willing to trial different elements of heavy-vehicle road-user charging. The intelligence and data we collect across our State would then inform the introduction of a national charging scheme.



“Such a scheme has the potential to result in better roads, with users paying for the roads they’re actually using and the roads that can support higher-productivity freight vehicles.”



He will be heading into the next COAG meeting with this proposal in his back pocket. Judging by the reaction from stakeholders, there is a good deal of backing for this proposal from both government agencies and the top end of town, the logistics specialists.



The trucking industry does moan and complain constantly about the current system for setting the level of rego charges, but is happy to take the fuel tax credit. However, the disruption we can expect if a mass/distance/location charging system comes along is going to make us look at costs in a completely different way.



The argument for the change in charging is rational and should improve productivity. The trucks which cause the most road wear will be paying the most each year and, in a logical world, the prices these operators can charge should increase to compensate.



In the Australian Logistics Council’s reaction to Weatherill’s speech at the National Press Club, Managing Director, Michael Kilgariff, talks about the estimate, a one per cent improvement in productivity yields a $2 billion a year benefit to the Australian economy.



The figures appear compelling at a countrywide level but will be disruptive at the level of the transport operator. Plus, there is the fact there will have to be a way of recording the mass/distance/location of each truck in place, whether paper or electronic.



Is there any point in fighting the introduction of a new road user charging regime? Probably not. It’s introduction is looking increasingly inevitable. Surely, the way to go for the trucking industry is to accept the possibility, get involved in the development process and make its introduction happen with the minimum of disruption to the industry.