National Heavy Vehicle Regulator faces "inherent uncertainty" due to burgeoning financial commitments.
A cash-strapped National Heavy Vehicle Regulator (NHVR) will head into 2015 with a significant debt hanging over its head and uncertainty about its future.
The fledgling agency is struggling financially due to the decision of state and territory governments to issue loans instead of grants to the NHVR to keep it running.
It has racked up loan liabilities of more than $23 million that will take until 2023 to pay off, its annual report states.
Most of the debt was incurred last financial year when jurisdictions loaned a total of $15.6 million.
“The Regulator faced some serious financial challenges in 2013-14 arising from the decisions taken by some jurisdictions to provide their financing contributions as loans rather than grants,” NHVR chair Bruce Baird says in the annual report.
Baird says the loans are “a significant debt burden”, and they have worn most of the blame for the parlous financial situation the NHVR finds itself in.
“The Regulator recorded a net loss of $8.853 million, a net liability position of $13.461 million and negative operating cash flows of $15.300 million…for the period from 1 July 2013 to 30 June 2014,” the annual report says.
“This position predominantly reflects the provision of operational funding being provided as loans. As such, there remains inherent uncertainty as to the going concern of the entity.”
The $8.8 million loss is almost double the loss the NHVR reported in the 2012-2013 financial year ($4.6 million).
NHVR chief financial officer Melinda Bailey says the regulator went $7.5 million over budget for operational expenses last financial year and had to seek an advance from governments to pay its bills.
“To assist in the payment of outstanding creditors, the Regulator received an advance of $1.8 million from its approved 2014-15 budget prior to 30 June 2014,” Bailey says in the annual report.
It has been a tough year for the NHVR, which is still trying to clean up the mess left when it briefly took on responsibility for processing heavy vehicle permit applications.
However, the regulator did record some achievements last financial year.
Approvals under the Performance Based Standards (PBS) scheme increased substantially, new fatigue management templates were developed and improvements were made to heavy vehicle access.
But the problems with the permit approval process dogged the regulator and reduced its standing in the eyes of trucking operators.
“Overall, customer satisfaction has been identified as mixed across the Regulator’s services in 2013-14, with chronic issues with access permit issuing leading to significantly negative customer experiences,” the annual report says.
“Improved outcomes with the delivery of PBS and accreditation services with the move to fully national approaches from February 2014 have, however, been identified as positives.”