Lawyers in warning on road pricing complexity

A lot of legislative movement needed in a febrile political environment

Lawyers in warning on road pricing complexity
Road pricing is a complicated business.


Road pricing will need exemplary coordination between government levels to be effective, legal experts have warned.

The advice comes as transport infrastructure decisions become increasingly politicised at state and federal levels.

Corrs Chambers Westgarth lawyers David Warren and Marianna Schneider believe the potential gains in investment efficiency and flow-on effects are many but these will be dissipated if poorly implemented and operated.

"There is a mismatch between the levels of government which raise the revenue for roads and the levels of government responsible for the construction and maintenance of our roads," Warren and Schneider says in an analysis of moves needed to bring the initiative to fruition.

"The collection and allocation of revenue for roads is a complex matrix which could be more transparent: the end result is a potential inequitable allocation of federal funding between the States and Territories.

"Without coordination on road pricing reform between all levels of government, some users could end up paying higher overall charges than others (with the difference not reflecting their different use of the network).

"Ultimately, coordinated and clear minded structural road pricing reform is an opportunity for governments to realign the system, boost productivity, better manage our cities' congestion problems and generate the funding we need to build and maintain a better road network."

The pair notes that of the eastern states, New South Wales and Queensland already have legislation which allows authorities to declare a tollway and levy tolls, while Victoria does not, and they highlight nine points for legislative attention:

  • Facilitating powers: Government will need to give itself the powers to impose a road pricing scheme. Also, in order to competitively source the operation of the scheme from the private sector, Government will need the power to let a private entity collect the charges on its behalf
  • Application to existing roads: currently, tolls are only applied to new freeways. A general road pricing scheme such as a comprehensive model will need to cover at least existing major roads
  • Setting the level of the charges: who will have the power to set the charges and how will they change over time? This may need regulatory oversight from the ACCC or the equivalent state-based pricing regulators, such as NSW's IPART and Victoria's ESC
  • Dynamic pricing: if a road pricing scheme uses dynamic pricing (where prices increase as congestion increases), for maximum impact on driver behaviour, drivers will need to be provided with real time charging information
  • The legal form of the charge: for example, whether the charge will be a municipal/ state/ federal tax, a congestion or environmental levy, or some other form of charge. This will depend on the road pricing model used and whether it is coordinated between Federal and State governments or not
  • Proceeds from the scheme: safeguards should be enshrined in legislation to ensure that all money raised from the scheme is reinvested in improving transport outcomes. This will necessarily involve spending on public transport as well as roads
  • Technology: the technology used for one system must be compatible with the technology used for other systems throughout the country. It will need to be easy to use, reliable and inexpensive for motorists
  • Protection of privacy: privacy concerns are paramount. The technology used in a road pricing scheme could involve compulsory monitoring of motorists by car tracking devices or satellites. Strong legislative protection will be needed to restrict the use of data
  • The enforcement process: every revenue raising scheme portentiall has a dark side the need for enforcement in road pricing is no different. The road charging technology will need to provide data as evedence to support prosecutions agains evaders.

You can also follow our updates by joining our LinkedIn group or liking us on Facebook