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Tolls now outweigh driver’s wage cost says NatRoad

Industry body call for new focus on how system operates

 

The New South Wales Government must show national leadership and reform its road tolling system for heavy vehicles with the revelation that Sydney tolls are outstripping the cost of driver wages, according to the National Road Transport Association (NatRoad).

NatRoad was due to appear before the Transport and Customer Service Committee of the NSW Legislative Council’s Inquiry into Road Tolling Regimes this afternoon, but the hearing has been postponed by the Sydney lockdown.

NatRoad’s written submission calls for a variable toll rate that incentivises off-peak journeys or gives discounts for multiple journeys, and creation of an independent regulator to manage a fair and transparent toll pricing regimen.

“High tolls are a burden that’s simply unacceptable for owner-operators operating on an average profit margin of just three percent,” NatRoad CEO Warren Clark said.

“They force trucks onto un-tolled suburban roads, generate noise and congestion, cause safety problems and increase emissions.”


Read how NatRoad tackled the issue earlie this year, here


Allan Thornley, MD of Eastern Creek-based trucking company Shaws Darwin Transport, said that the $140 round trip cost of tolls for a typical delivery run from western Sydney to the Northern Beaches now outweighs the $134 cost of a driver for the four-hour trip.

Thornley estimated his company’s cost in tolls to operate a delivery truck around Sydney is about $38,000 a year.

The cost of tolls had climbed since the opening of the M7 in 2005 and even more markedly in the last three to five years.
 

Costs for a 12-pallet rigid delivery truck trip from Eastern Creek to Brookvale and return
Driver’s wages for a 4 hour round trip $134
Capital cost of a rigid (half-day) $50
Tyres, maintenance and fuel $50
Cost of tolls
(WestLink M7, Hills M2, Lane Cove Tunnel and Military Road E-Ramp)
$140
 

“It’s come to the point where I even question the value of our drivers using tolled roads,” Thornley said.

“The cost of the tolls seems to far outweigh all the other costs to operate a truck over the road.

“Most routes give only limited time and distance savings.

“They are generally easier for a truck to navigate with fewer corners and intersections, but the cost is significant and something we can’t control.

“We have looked at ways to offset tolls and it’s almost impossible to do so without introducing a lot of red tape.

“We are operating at scale on other routes so we can absorb some extra charges, but there are many smaller operators whose average net profit margin (after tax) has fallen to about 3% and aren’t so lucky.”

Clark said truck operators pay a fuel-based road user charge and between three and 11 times more in registration charges than cars, depending on the weight of the heavy vehicle.

“They shouldn’t be loaded up with tolls that are generally three times greater than for cars,” he added.

“The country’s largest toll operator, Transurban, applies its own multiplier to trucks versus car tolls for road wear and repair using a logic that defies understanding.

“Modelling shows that of the extra $16.48 Transurban charges a truck over 20 kilometres on the M7, just $3.20 represents actual road damage costs.

“If charges reflected the real cost of road maintenance or the actual savings from using tollways, operators would be more likely to use them.”

Clark says the concepts of variable toll rates and off-peak incentives were not new but Australian governments were notoriously shy of making them a reality. The catalyst would be the creation of an independent tolls regulator.

“Variable tolls that incentivise off-peak travel, or multi-use discounts, are simple mechanisms that would restore fairness and save communities a lot of grief,” Clark says. 

“Heavy vehicle operators and motorists alike would benefit from having a ‘cop on the beat’ to stop unfair toll road practices.

“The independent regulator would oversee an independent pricing system based on pricing rules agreed by the government.

“It would set service levels for the road network to facilitate high productivity vehicle access, future vehicle automation and truck rest stops.”

Clark said NatRoad would be happy for the Independent Pricing and Regulatory Tribunal (IPART) to fill the role on an interim basis and then recommend a way forward, based on an analysis of all current government contracts with toll providers.

 

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