Government should split the bill on road pricing reform: Hensher


Governments should cover half the cost of retrofitting old trucks with GPS if they pursue mass-distance-location charging, transport academic says

Government should split the bill on road pricing reform: Hensher
Government should split the bill on road pricing reform: Hensher
By Brad Gardner | July 28, 2011

Governments should cover half the cost of retrofitting old trucks with on-board monitoring technology if they pursue mass-distance-location charging, a leading transport academic says.

Professor David Hensher, who leads the Institute of Transport and Logistics at the University of Sydney, believes any switch to a new road pricing scheme must involve help for operators using older vehicles.

The COAG Road Reform Plan (CRRP) has recommended installing on-board mass monitors and GPS trackers in trucks to charge individual vehicles based on the mass they carry, the distance they travel and the roads they use.

It says its plan, which proposes limiting the scheme to multi-combination vehicles and heavy truck trailers, will cost close to $4 billion over 30 years due mostly to installing technology in trucks.

The figure does not factor in the cost of a billing system, which the Australian Trucking Association (ATA) claims "is going to be enormously expensive".

Hensher says older vehicles lacking the latest technology still have a long life ahead of them and adds that it is only fair government pay some of the cost because it will be imposing a new regulatory regime.

"I think it’s fair on retrofitting situations government makes a contribution, maybe 50-50, but I think on replacement vehicles it needs to be built into the cost of the vehicle and the government shouldn’t have any involvement," he says.

"We’ve got to make sure whatever we do doesn’t actually cause hardship for what’s clearly an important sector, which is the trucking sector, which is going to continue to be the dominating way of moving freight no matter what the rail buffs say."

A large chunk of the freight task is made up of older trucks, with the Truck Industry Council saying 41.5 percent of vehicles were registered before 1995.

Hensher, who has been directly involved in the work on road pricing reform, says mass-distance-location pricing must also come with a transitional period to give operators time to adapt.

He has also questioned the CRRP’s decision to recommend limiting reforms to a select sector of trucking.

"I do find that odd. There is a clear case for doing it across the board rather than doing it like that," he says.

According to the CRRP, which is made up of bureaucrats from state-based road departments, applying the new charging model to the entire trucking task will cost $12 billion over 30 years. The figure does not include the cost of a billing system.

The ATA is lobbying for a fuel-based charging system that imposes a flat registration fee in return for a higher diesel excise. It argues its model is simpler and cheaper than mass-distance-location charging and will ensure governments recover enough costs from the trucking industry.

But Hensher has rejected concerns that the scheme will be complex and expensive, likening the industry’s claims to "the fear of the unknown".

"Once it’s in place, people, I’m sure, will adapt to it and find it’s not that. And in fact it will give them much better data on their business in terms of what they are doing," he says.

Hensher says a tracking system can deliver important information to government and industry, such as how many km vehicles are travelling and what roads they are using. He says operators will be able to use the information to wring extra efficiency out of their fleets.

"It’s a win-win all round in terms of information."

The CRRP is currently in the final stages of a series of public consultation sessions on its preliminary findings.


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