Farmers baulk at road pricing proposal

Farming groups fear direct road pricing will disadvantage primary producers and lead to a form double-dipping

By Brad Gardner | September 28, 2011

Farming groups have baulked at a proposal to systematically alter road pricing, fearing it will lead to a form of double-dipping on road taxes and leave primary producers worse off.

The National Farmers Federation, NSW Farmers, the Victorian Farmers Federation and the South Australian Farmers Federation have all expressed concerns about a recommendation to introduce mass-distance-location charging for a select portion of the trucking industry.

The groups all penned submissions to the Council of Australian Governments Road Reform Plan (CRRP), which earlier this year called on governments to fit GPS trackers and mass monitors to multi-combination vehicles and truck trailers .

If introduced, the scheme will bill trucking operators based on the weight of a vehicle, the distance it travels and the roads it uses. The GPS tracker will record the route a truck travels on, with revenue allocated to the relevant road manager.

Victorian Farmers Federation Chair Peter Tuohey says the CRRP’s finding that the cost of using a local road will be significantly greater than using a highway or freeway will "severely disadvantage" farmers because they have little choice but to use local roads.

"It must also be noted that the farm community already contribute heavily to the maintenance of local roads through a considerable municipal rates burden. A move to recover all costs associated with road would lead to farmers paying double," Tuohey says.

He says that his members are struggling to see the benefits of road pricing reform, which the CRRP claims will lead to more efficient and productive use of the network and deliver funding certainty to governments.

National Farmers Federation CEO Matt Linnegar wants the CRRP to answer how its proposal will affect existing council rates, saying: "It seems inappropriate and inefficient for multiple charging mechanisms to exist for local roads."

Linnegar criticises what he says has been a lack of work on the supply side of the reforms, such as determining how revenue will be distributed transparently and how asset managers will be accountable for maintaining and developing roads.

"Fundamental questions exist regarding how road user charges collected under the proposed scheme would be reinvested in the road network," he says.

Justin Crosby, who leads the policy team at NSW Farmers, echoed concerns made by Linnegar in saying not all farmers and small transport operators can afford technology.

"Some heavy vehicles are used only once or twice a year, meaning that investing in GPS and similar technologies in these cases would impose a heavy cost burden," he says.

Crosby says road funding should come from a combination of vehicle charges and consolidated revenue, with larger roads cross-subsidising investment in local routes.

"Any road reform plan must be based on a two-tiered fee structure, which guarantees that the dire situation of rural roads is addressed," he says.

The Australian Trucking Association advocates a fuel-based charging model but the Australasian Railway Association and Infrastructure Partnerships Australia (IPA) have backed the CRRP plan.

IPA CEO Brendan Lyon says the changes will deliver funding certainty but wants the CRRP to go further and push for all vehicles to be bound under mass-distance-location pricing.

Lyon suggests using the heavy vehicle pricing reform as a test case for the later application across the entire road network.

"The CRRP is an important first stage in an incremental approach to road pricing reform," he says.

However, in his written response to the CRRP proposal, Lyon notes the "politically charged nature of the debate" on road pricing reform, which he adds "has lacked boldness and clarity".

"However, the current work of the CRRP and the inclusion of road pricing on the agenda of the National Tax Summit is creating a renewed momentum in the debate and must be seized," he says.

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