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Reconsider road funding strategy: IA

A government inquiry aiming to find a "user-pays approach" to maintaining roads is overdue, Infrastructure Australia says


Australia seriously needs to consider how it funds roads, including potentially charging motorists based on how far they travel, outgoing Infrastructure Australia (IA) chief executive Philip Davies says.

Davies made the comments following the release of a new IA report into the success of the Australian Infrastructure Plan, released in 2016, which made 78 recommendations to address the infrastructure needs of a growing population.

Davies says funding to build and maintain our road infrastructure comes from a mix of fuel excise and vehicle registration charges.

But with Australian drivers starting to move to electric vehicles, in coming years this source of revenue could well dry up, he says.

“In other words, we will be collecting less from users, using roads more, and limiting our ability to collect the revenue required to build and maintain our roads,” he says.

Davies notes that the original plan recommended that the government initiate an inquiry into the benefits and impacts of road market reform – “with a view to transitioning to a fairer and more efficient user-pays approach.”

IA said that the government had signalled its support for that plan in November 2016, but that no inquiry had been forthcoming since then.  

“Road market reform has the potential to deliver significant improvements in network performance and address fairness issues, while also establishing a secure and sustainable source of funding for our roads,” he says.

“Given the significance of this change and the scale of community consultation and consensus-building involved, it’s vital that governments move forward on this important opportunity for reform.”

Despite this, the report also noted that governments had made “important progress” on heavy vehicle road user charging.

“The current heavy vehicle road use system (PAYGO) is based on historical spending and apportioned using fleet averages,” the report says.

“The aim is to switch to future spending plans and a more precise allocation to individual vehicles.”

Also singled out for praise in the report was the Inquiry into National Freight and Supply Chain Priorities, concluded in May, and moves by the New South Wales government to protect four strategic transport corridors in Western Sydney.

Industry groups had a lot to say about the Inquiry into National Freigth and Supply Chain Priorities when it came out. Read more here.


Speaking in support of today’s report, Australian Logistics Council managing director Michael Kilgariff says the Inquiry noted that governments needed to take action to secure greater supply chain efficiency.

“Today’s report from IA further supports that view,” he says.

“ALC has continually advocated the need for greater national consistency in the governance of issues that impact upon freight movement,” he says.

Among the issues he identified as places where more effective national outcomes were needed were land use planning, corridor protection, heavy vehicle safety, road pricing and access issues.

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