ALC proposes roundtable on heavy vehicle road reform


Kilgariff says the current system requires an overhaul to improve the efficiency of the supply chain sector

ALC proposes roundtable on heavy vehicle road reform
Michael Kilgariff says the ALC has developed a set of principles to move the debate forward

 

The Australian Logistics Council (ALC) is calling for a wide ranging public debate to progress the issue of heavy vehicle road reform.

In a letter to federal minister for major projects, territories and local government Paul Fletcher, the ALC says the current system requires an overhaul to improve the efficiency of the supply chain sector "against the backdrop of an increasing freight risk".

"ALC also welcomes Paul Fletcher highlighting this issue in a recent ministerial statement on road pricing when he reaffirmed the Government’s commitment to accelerate work with states and territories on heavy vehicle road reform," ALC MD Michael Kilgariff says.

Fletcher "correctly argued" the existing system for funding roads in not sufficient anymore and requires a "new approach".

The ALC has developed a set of principles "to progress the debate which could be used as a basis for further discussions within the proposed roundtable".

"ALC would also like the roundtable to address the issue of mandatory telematics in heavy vehicles, as this technology will need to play an integral role in any road funding reform.

"As part of this campaign, earlier this month I wrote to all federal, state and territory transport ministers to encourage them to put in place the regulatory and administrative steps needed to advance the mandatory use of telematics in heavy vehicles to improve safety and compliance outcomes," Kilgariff says.

The ALC recommends that prices in the new system should be set to generate expected revenue at a level that recovers the efficient cost of service, a return on investment commensurate with the risks involved, and depreciation.

It also suggests that infrastructure provision should be based on the development of plans and service standards that are consistent with commercial principles, responsive to current and future requirements of freight transport, and developed with a transparent and nonpartisan approach.

Moreover, it calls for the inclusion of senior Treasury officials in the reform process and has encouraged the Government to include Treasury representatives in the roundtable.

All these issues will be discussed at the ALC Forum to be held from March 1-3 in Sydney.

Speaking on behalf of the road transport operators, the Australian Trucking Association (ATA) says it "does not support mandatory regulatory telematics".

"However, we strongly support their use for businesses that voluntarily take up the technology where there is a business case to do so," ATA policy manager Bill McKinley tells ATN.

"The benefits of road pricing would come entirely from the reforms of road planning and funding that would accompany it," McKinley says.

The ATA argues that:

  • changes to road prices must be accompanied by road planning and funding changes at the same time
  • these changes must include the creation of an independent economic regulator that can set road prices
  • the implementation of road pricing reform must not impose increased compliance burdens on road transport operators
  • instead, the reforms must include generally lower compliance costs and smoother cash flow as core objectives.

The first step towards road pricing implementation should be to review the existing road charging system that is currently overcharging all road transport operators, McKinley suggests.

"Truck and bus operators will be overtaxed by more than $500 million by June 2018 under the existing system," he says.

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