OUR SAY: Opportunities and challenges lie ahead under carbon tax

The carbon tax won't be enough to convince governments on higher productivity vehicles, but it might help safe rates supporters

OUR SAY: Opportunities and challenges lie ahead under carbon tax
OUR SAY: Opportunities and challenges lie ahead under carbon tax
By Brad Gardner | July 20, 2011

Being told they got off lightly under the recently-announced carbon tax package might not sit well with operators struggling to make ends meet, but it’s fair to say the trucking industry scored a generous deal.

When Prime Minister Julia Gillard announced households, small businesses with light commercial vehicles and tradespeople would be shielded from higher fuel prices, it would have been fair to expect trucking would have had to bear some impost.

After all, as Treasury points out, transport accounts for about 14 percent of emissions, with road transport contributing more than 85 percent of that figure. Any serious attempt to halt and subsequently reduce Australia’s carbon footprint demands the sector’s inclusion.

And the government might have genuinely thought the industry supported being bound by the scheme from the beginning. For the last few years, the trucking lobby has made the case that a carbon pricing scheme must include transport otherwise operators would face the prospect of more onerous regulations to make up for its exclusion.

It was only in the final days before the unveiling of the carbon tax did the Australian Trucking Association (ATA) push hard for a complete exemption.

As it is, Gillard granted a two-year reprieve on fuel for truckers. The decision is twice as generous as what former Prime Minister Kevin Rudd offered under his Carbon Pollution Reduction Scheme (CPRS).

But it doesn’t mean it’s a reason for operators to bury their heads in the sand until July 1, 2014 and then start squealing when they have to pay about an extra 7 cents per litre for diesel.

The two years gives transporters the time to sit down and work out how the increases will affect them, what they need to do to prepare and what it means for their customers. There’s no reason why a customer should be surprised when the surcharge jumps come July 2014.

It won’t be easy in some cases to recoup the total cost due largely in part to the cutthroat nature of the business, but the ability to give ample forewarning will strengthen the case for a surcharge increase.

The industry might, however, struggle in its quest for higher productivity vehicles to be given greater access to the road network on the basis of addressing climate change.

When he released a report on the industry’s environmental credentials, ATA Chairman David Simon used it to call on governments to open up more of the road network to larger truck combinations.

The ATA is right in saying the vehicles will help the industry deal with a burgeoning workload while at the same time addressing emissions.

But focusing solely on the environmental gains won’t cut it. If you chat to local government officials or flick through their submissions presented to government bodies looking at the road freight task, the key themes that keep popping up revolve around a lack of funding and community acceptance.

While environmental gains might have some importance, councils really care about money to invest in their roads to bring them up to standard and keeping the ratepayers happy.

The funding issue is making progress, albeit slowly, through the work of the COAG Road Reform Plan. Its proposal for a mass-distance-location scheme isn’t the funding model the industry is keen on, but it does have the potential to deliver benefits with the correct oversight and application.

A much harder task is getting residents onside. The trucking industry has a shocking public profile, much of it unwarranted. But regardless of the importance of this industry to the economy, the anti-truck mentality is strong among the general public.

The recent Auspoll of 1,500 people found that 61 percent wanted truck movements in cities restricted to non-peak periods, while 53 percent supported bans on large trucks in cities.

The South Australian Road Transport Association (SARTA) is correct in pointing out that the support for bans is counter-productive and nonsensical. That is of course unless people want to march themselves down to rail stations to collect all their consumer goods.

There is good work being done to lift the industry’s profile, such as the ATA’s Road Ahead exhibition and the tireless advocacy efforts of individuals like Rod Hannifey.

But the exhibition isn’t enough and Rod Hannifey is only one man (cloning isn’t legal).

So does the industry stump up the cash for advertisements or pour more resources in education campaigns to convince the public of the benefits of larger vehicles and the importance of the freight task?

It might need to do something, because using the carbon tax to push its case won’t be enough to make it happen.

The tax might, however, help the Transport Workers Union’s bid for safe rates. When Gillard announced that select groups would be exempt from higher fuel prices, TWU boss Tony Sheldon used the prospect of increased costs on truck drivers to push for remuneration reform.

The matter had received occasional coverage in the mainstream press. But it all changed when Sheldon hitched his campaign to the carbon tax and claimed drivers would be left in the lurch if they were not paid enough to cover cost rises stemming from the introduction of the scheme.

Mainstream outlets started covering the issue, the Opposition used Sheldon’s comments to pepper the government with questions and federal Labor senators who came from TWU ranks spoke up about the need to protect drivers.

Yes, the government has stalled on rates reform and is yet to provide concrete details on when something will be done. But the PM might feel the heat to act. She faces a tough enough task selling the carbon tax to the public without the union providing ammunition for the Opposition or egging on former TWU mates in the Senate to break ranks.

While it might be another two years until it directly hits trucking operators in the form of higher fuel costs, the carbon tax is set to have an impact well before its 2014 start date.

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