Warren Truss (Wide Bay, National Party, Shadow Minister for Infrastructure and Transport and Local Government) Share this | Link to this | Hansard source

The Interstate Road Transport Charge Amendment Bill 2008 and the Road Transport Charges (Australian Capital Territory) Repeal Bill 2008 make adjustments to the cost recovery charge-setting mechanism that applies to the trucking industry. The two key elements of the charge structure that apply to Australia’s road freight sector are registration fees and the diesel fuel excise system, known as the road user charge. The determination of the appropriate level of these charges occurs through the National Transport Commission, which makes recommendations to the Australian transport ministers at their meeting of the Australian Transport Council to recover road expenditure attributable to heavy vehicles. The principle behind the charge-setting arrangements that apply to the trucking industry is that it should pay its way. The trucking industry accepts this principle. Whilst this does mean that the industry pays higher charges than would otherwise have been the case, it recognises that as an industry it has an obligation to the community to pay its way. It is important for the community to know that, whilst there is substantial community expenditure on roads and other infrastructure, the road transport sector—those big trucks that run up and down the roads day and night—is making a substantial contribution to the cost of maintaining and building that road network.

Specifically, the Interstate Road Transport Charge Amendment Bill 2008 updates definitions contained in the Interstate Road Transport Act 1985 and grants the Australian Transport Council the power to determine the charges that will apply to Commonwealth registered heavy vehicles. The Road Transport Charges (Australian Capital Territory) Repeal Bill 2008 ends a system whereby the Australian Capital Territory sets the reference charge for other jurisdictions to follow, currently based on Commonwealth provided ACT law—the Road Transport Charges (Australian Capital Territory) Act 1993. Members may be aware that on 29 February 2008 Commonwealth, state and territory transport ministers at the Australian Transport Council agreed to a revised set of charges that will apply to Commonwealth registered heavy vehicles. These charges will be used as reference fees by the states and territories on their own heavy vehicles. Essentially, that is what these bills are about: the application of charges agreed to by the Australian Transport Council to heavy vehicles registered under the Commonwealth and the subsequent take-up of those charges to vehicles registered under the states and territories. We are talking, therefore, about what costs are imposed upon Australia’s road freight industry.

The opposition has concerns about the impact of these bills, and I will refer to some of those issues later. But we also have specific concerns about some of the content of the bills. The Interstate Road Transport Charge Amendment Bill 2008, for example, will require the Commonwealth to always impose the charges agreed to by the Australian Transport Council to trucks registered by the Commonwealth, known as the Federal Interstate Registration Scheme or FIRS. This provision may be found in proposed section 5(4) on page 9 of the bill. The relevant clause reads:

Regulations made for the purposes of this section must implement the national charge imposed on the registration of heavy vehicles, and any adjustment process of that charge, that is agreed by the Australian Transport Council.

This provision causes us some serious concern because, under it, the Commonwealth will lose its discretion to dissent from the ministerial council and will be unable to determine in its own right the charges that should apply to Commonwealth registered vehicles. Given that the charges agreed to by the Australian Transport Council are reference fees used by the states and territories, should the Commonwealth wish to apply competitive pressure on the charges imposed by the states and territories on their own heavy vehicles it will be unable to do so. It seems extraordinary that an Australian government would bind itself to decisions made by other governments without giving itself any discretion to be able to make a separate determination in the national interest. Moreover, decisions in the Australian Transport Council are not always by consensus. In the case of a disagreement between jurisdictions it is possible for a majority decision to occur. In theory at least, it would be possible for the Commonwealth to be saddled with a decision which it did not support.

I accept, when it comes to regulatory issues, that the states and the Commonwealth are essentially sovereign, but I am still uncomfortable with a legislative provision that removes the right of the Commonwealth to dissent from a charge regime agreed to amongst the states. In other words, the Commonwealth would be binding itself to a decision made by others. This is something that seems to have escaped the Rudd government. It is the job of the Commonwealth to provide national leadership and to ensure, where possible, that competitive pressure applies to state based charge-setting arrangements. What we are seeing is an abrogation of this role. The Labor-run federal government is letting its state Labor mates have free rein when setting the fees that will have to be carried by a crucial sector of the economy, Australia’s road freight industry. I think this is another example of what is meant by ‘ending the blame game’! The Commonwealth is walking away from any attempt to impose accountability upon the decisions of the states. This is highly regrettable.

The real impact of these bills will be felt in the associated regulations that are to be tabled in parliament after the passage of the bills. The regulation will schedule the details of the heavy vehicle registration charges. These charges will contain significant increases to be implemented over three years from 1 July 2008. The basis of these increases is the view of the Rudd government that the trucking sector is somehow not paying its way—which is by no means clear, with independent research commissioned by the trucking industry suggesting that the sector is already overcharged by around $100 million per year. Even if you accept the figures of the National Transport Commission, there is still only a relatively minor under-recovery of the costs that are imposed by the industry. There are arguments about whether the charges are being evenly collected across the industry and whether one sector is subsidising another. Those sorts of issues are the key elements of work done by the National Transport Commission.

In spite of the case for these increases in charges being unclear, the Rudd government has decided to press ahead anyway. It will determine these charges by applying an annual road cost adjustment formula. This formula is largely based on expenditure costs associated with the impact of trucks on our road system. It will be a particularly expensive formula for Australia’s road freight industry since, as is common knowledge, costs associated with road construction and maintenance—such as steel, concrete, asphalt, oil products et cetera—are skyrocketing. So the registration costs are going to go up at a higher rate than the CPI. What does this mean? It means that close to 70 per cent of Australia’s truckies—and, in particular, all of those at the heavier end of the industry—are going to be paying more. This will mean that there will be rising costs associated with road expenditure that are completely out of their control.

The structure of the charges penalises productivity, since the costs agreed to by the Australian Transport Council fall heavily on the highly productive multicombination vehicles, such as B-doubles and B-triples. For example, the registration charges for B-doubles will increase from $8,041 to $14,340, including a multicombination prime mover charge of $7,050. B-triple charges will skyrocket to $20,340, including the multicombination prime mover charge of $7,050. Smaller vehicles will not have increases and, in a small number of cases, will actually pay less. The reality is these are very substantial increases in charges on the most efficient sector of the industry. Indeed, previous meetings of ministers at the Australian Transport Council had agreed that there ought to be encouragement to move the sector towards the more productive units. There was a conscious decision made to cross-subsidise these larger units to encourage their take-up. I think that this was sound policy. These larger units have road-friendly suspensions. The evidence suggests that they are more friendly to roads and less likely to cause damage than the smaller units. The result of this fee structure will reduce the incentive for operators to use high-productivity vehicles. Operators will be inclined to stick with semitrailers instead. For a government that has got a long-proclaimed greenhouse agenda, it seems extraordinary that it has agreed to a charge arrangement that will actually encourage more greenhouse emitting vehicles on our roads.

But there is more. As the second part of the fee structure imposed on heavy vehicles, the Australian Transport Council decided to increase the road user charge, or diesel excise, from 19.633c per litre to 21c per litre. This will be achieved by reducing the amount of rebate that on-road diesel users will receive in the trucking sector. Most importantly, this fuel excise increase will be indexed on the same formula that is used for the heavy vehicle registration charges. This regulation under the Fuel Tax Bill 2006 was tabled by Labor on the sly in the House on 13 March, before this legislation had even been brought into the parliament. It will take effect from 1 January 2009. We will be moving to disallow this instrument. This instrument brings back fuel excise indexation. It brings back something that has been written out of the Australian agenda for quite a few years now. The indexation of fuel excise, members will recall, was introduced by the Keating government and then abolished by the Howard government in early 2001. After a seven-year absence, it is back for trucks and pegged to a formula that will lock in a greater tax take than you would get under the CPI. Not only do we have indexation but it is indexed to a formula that will deliver very much higher tax rates than would occur under the CPI.

This is a highly significant decision by the new Labor government. In one of its first acts in office, it has introduced a new tax—a tax that will increase at a rate greater than the cost of living. Who will pay for it? Initially, the sector responsible for moving 75 per cent of Australia’s domestic freight will pay. Those who drive the nation’s 365,000 trucks, many of whom are struggling small business operators, will have to pay. So much for defending working families. Here is a group of very small businesses, most with high debt and many of them single unit operators—people who battle to win contracts and who keep their trucks on the road for long hours just to make a living. These are the people that are going to have pay a new indexed tax, introduced compliments of Labor.

In the end, of course, all Australians will pay. The increased costs will be passed on to the consumer and there will be a rise in prices for everyone. From cornflakes to building materials, from medicine to school shoes—the everyday items that working families need—all of these prices will go up as a result of the new tax Labor is proposing to introduce today. For the Rudd government to increase taxes when so many Australians are hurting due to interest rate rises exposes the emptiness of his claim to be serious about fighting inflation.

Many of the smaller operators will have particular difficulties in passing on these taxes, but the larger operators who move groceries and some of the big-volume items for regular customers will of course pass these increases straight on to the shopkeepers, the retailers, who will in turn put them straight onto the price of every item in every store. Remember the Prime Minister’s promise in the election about putting downward pressure on grocery prices—he has done precisely the opposite. What is the good of an ACCC inquiry into grocery prices and pretending it is going to have some kind of downward impact, when on the other hand you are putting up taxes in a way that will guarantee that, no matter what the findings of the inquiry might be, groceries will be dearer after the election of the Rudd Labor government than they were previously?

This decision also clarifies another element of this so-called ‘ending the blame game’, which Labor ministers like to say. It means that, now that we have wall-to-wall Labor governments, no Labor transport minister will blame another for raising taxes; they are all in the deal together. The Labor transport ministers have been wanting to increase these taxes for years. The coalition government has blocked this revenue rise. Now it appears that there is no longer any protection for Australia’s hard working truck-ies. We have wall-to-wall Labor transport ministers, so in reality the increases in taxes will come again and again. What about the struggling farmers and the cash-strapped mums and dads who will have to pay more as the increases flow through to them?

It also flies in the face of the reassurances that were given by Labor frontbencher Martin Ferguson, who when he was the spokesman for transport told the trucking industry at the Australian Trucking Convention in Cairns in April last year ‘squeezing profitability of the trucking industry is in no-one’s best interests’. He pretended on that occasion to be a friend of the truckies. He pretended that Labor would stand up for the trucking industry. But now they are in government the story is different. Either the member for Batman was being indifferent to the truth or he got rolled. Regardless, the Rudd government has introduced a new tax that is inflationary and will make life harder for struggling families.

Let us look now at the revenue implications of raising heavy vehicle registration charges and reintroducing fuel indexation via the road user charge. Labor state and territory government revenue will rise substantially as a result of increased fuel tax and registration charges, with the annual revenue stream to Labor governments growing by $168 million. Put another way, the fuel tax take to Labor states and territories will rise from $1.146 billion in 2007-08 to $1.226 billion in 2010-11—an increase of $80 million. The increase in heavy vehicle registration charges will push up the tax take for Labor state and territory governments from $638 million to $727 million in the same period—an increase of $88 million. In terms of the states, Labor-run New South Wales will see its registration tax rise from $150.3 million in 2007-08 to $166.8 million in 2009-10 and Victoria’s registration revenue will rise 15 per cent, from $171.4 million to $197.9 million, in the same period.

Given the poor track record of the Labor states in project management, there are no guarantees that we will actually see any improvement in transport infrastructure arising from these higher charges. One of the fundamental weaknesses of the road user charge scheme is that the money collected from the registration or the fuel excise is not hypothecated, so there is no guarantee that any of this money will actually be spent on roads. There is no guarantee that the states will go out and build extra roads to benefit the trucking industry. There is no guarantee that they will spend more money on maintaining the roads. It will simply go into their revenue and they will do with it as they wish. The minister has said that there will be a program of new road enforcement regulations—building a couple of rest stops and a number of issues like that. Some of those issues may well be worth while, but there is no guarantee that the money raised from this indexed new tax will in fact ever be spent on roads. I think the people of Australia need to be aware when they are paying higher prices for groceries, equipment and transport that the money essentially being collected from them will not necessarily be spent on roads.

Indeed, we have good reason to be concerned about where Labor is going in relation to road funding. I think the softening up process by the Rudd government to drastically reduce road funding around Australia has already begun. Labor used incomplete and old statistics in a crude attempt to downplay the coalition’s funding commitments for land transport, which were at record highs some years before the last election. With less than two months to go before the May budget, it now appears that the Labor government will halve the coalition’s AusLink commitments of $31 billion between now and 2013. Labor could spend as much as $15 billion less than the coalition promised during that period.

The Minister for Infrastructure, Transport, Regional Development and Local Government released a report by the Bureau of Transport and Regional Economics which suggested that, once adjusted for inflation, the coalition spent less annually on road funding than the previous Labor government. Unfortunately for those who expect some transparency and honesty from the government, there were at least three major flaws in that claim. Firstly, the report deals with spending until 2004. It was only in 2004 that the AusLink program was introduced. The big boost in expenditure, up to around $4 billion a year, occurred after the introduction of AusLink—and that occurred outside the time frame for the figures that the minister was quoting. Secondly, a big component of AusLink was the billions of dollars of new funding spent on rail—to get more freight off our roads so that they can last longer, freeing up money for new roads and a more efficient transport system. The minister conveniently forgot the expenditure on rail when criticising the coalition’s performance as an infrastructure builder. Thirdly, and never let this be forgotten, the previous Labor government put its road funding on the bank card. It was part of the $96 billion worth of debt that the coalition government inherited on coming to office. So the coalition government not only had to build new roads but also had to pay for the ones that Labor had built in its earlier term.

The reality is that we were left with the bill for the meagre road construction activity that Labor had undertaken during its previous term in office, so it is somewhat disingenuous for the minister to criticise the previous coalition government’s record on road funding. But it is even more dishonest if in fact he intends to drastically slash over the next four years the amount of funding that the coalition committed to roads during the last election campaign. In its last budget the coalition detailed infrastructure spending of $22.3 billion between next year and 2013, and an extra $7.3 billion was announced before the election. And all those promises were independently costed by Treasury. We provided to Treasury an extensive policy document—something like 75 pages—and the policies were fully costed. The policy package detailed the projects across the length and breadth of Australia on which $31 billion would be spent.

Labor’s election promises, we are now told as a result of the press releases that were put out during this last week, amounted to only $15.5 billion—half of what the coalition had promised. This amount would actually take expenditure backwards from what had been achieved in the past. There will be projects right around Australia that will be at risk from Labor’s razor gang. We have already heard about some of those projects. The $1.2 billion F3 to Branxton link road in New South Wales is not going to be built. There will be $500 million slashed from the Bruce Highway funding for work between Cooroy and Curra. What about Roads to Recovery and the $350 million funding that has been so essential for local governments to keep their roads up to date or the $300 million we had committed to spend on development roads around regional Australia? Labor has not committed to either of these essential elements of a road budget.

One has to be deeply concerned about the future of our nation’s road system under this government. Labor has never had much sympathy for the road transport industry. I can recall, as a minister attending meetings of state and territory transport ministers, state Labor ministers one after the other venting their spleen on the evils of having trucks running up and down their roads. Some of them are very much in a ‘get square’ mood at the present time and, sadly, they have a federal government that is only too willing to roll over and to impose these additional taxes on the industry.

A couple of days ago there was a letter to the editor in one of my local newspapers that was signed by Peter Schuback, from the Australian Long Distance Owners and Driver Association. He comes from an area not far from my home town. He wrote:

If the government was serious about tackling inflation then why has it approved the extra charges for the transport industry?

Why has it allowed the near doubling of registration costs of some long distance trucks (up to about $14,400 a year for B-doubles)?

Why has it allowed the horrific fines for truck drivers for minor breaches ($10,000 plus $1,000 for every 15 minutes over on your log book and six demerit points), especially when it has not provided the facilities so truck drivers can do the right thing and abide by the laws?

Members of the public should be made very aware that their household costs are going to double because of the government and National Transport Commission’s actions.

You have been warned.

Well, the consumers of Australia have been warned. This is not a tax that is going to be innocently imposed upon a profitable trucking sector that can simply absorb it and not pass the costs on to consumers; this is a tax that will be felt by every shopper every day that they go to a supermarket. Every time a struggling family goes to buy the week’s groceries, they will pay more as a result of this tax. And the minister admitted as much. He acknowledged that the effect of this would be of the order of $16 or $18 a year on the average grocery bill.

But it will not only be groceries for which there will be higher costs; there will be higher costs for everything that we buy every day. There will be higher costs on the sorts of things that people, particularly those who live outside the capital cities, use in their daily lives. People who live outside the capital cities will pay a higher share of this cost because transport is more important to them. Everything has to travel a distance to get to many of the small country towns in your electorate, Mr Deputy Speaker Schultz, and in my own electorate. This will also affect a manufacturing industry in a regional area. Because of the way in which parts are moved to put together various items of manufactured goods these days, there will be multiple times when this particular increase will be paid on the construction or manufacture of an item in a factory. As parts are moved in and out and are moved on a truck from one place to another to be assembled, the truck will pay higher fuel costs and higher registration charges each time as a result of this legislation.

This is not legislation that people can simply put aside and say has nothing to do with them. They will feel the effects of this every day. When the government comes into this place or goes on television and talks about how it cares about the higher costs of groceries for struggling families, people should be reminded that part of the reason that groceries are more expensive is that this government has indexed the diesel fuel that the truck uses to travel around the roads. Of course, the fuel itself has to be transported to service stations around the country by diesel trucks—diesel trucks that will cost more to register and for which there will be a higher level of tax on the fuel that they use to complete their journeys.

These bills support a new tax and an increase in registration charges, for which the case is not clear. The fees will discourage the use of efficient vehicle combinations and will increase truck traffic on our roads. The taxes and charges are inflationary and will make worse the financial struggle of not only the families of transport operators but all Australians. They include a new indexed fuel excise that will rise faster than the CPI. The taxes fly in the face of the Rudd government’s statements about fighting inflation. The decision represents an abrogation of federal Labor’s responsibility to ensure that the taxes imposed by their state Labor mates are competitive. It is for these reasons, and indeed many others, that the opposition will oppose these bills.

Chris Hayes (Werriwa, Australian Labor Party) Share this | Link to this | Hansard source

The extent of the carnage on our roads has been reduced over recent years; however, the tragedy continues to strike too many families. We see it on our television screens, unfortunately, on a daily basis, and it continues to inflict devastation not only on the families of the truck drivers or the road users involved but also on the wider community. This trauma is not isolated to the immediate victims of road trauma. The collateral damage affects many people, from the emergency services who lend assistance to the various voluntary organisations across the country to the people whom I represented for many years—the various members of the police service. I have to say, sadly, that the fight in terms of road carnage as a result of heavy vehicles cannot be won but there are many things that we should look at in addressing those issues, and they particularly go to road safety.

The National Road Safety Strategy has a target of reducing the annual number of road deaths per 100,000 head of population to below 5.6 by the end of 2010—that represents a 40 per cent reduction relative to the 1999 benchmark. This figure has become a formidable target with the aim of reducing the number of road fatalities. On 29 February this year, the transport ministers across the country unanimously endorsed this government’s plan to put into effect a $70 million heavy vehicle safety and productivity plan. I have had the opportunity to have a brief discussion about this with one of the main characters in the industry, Lindsay Fox, and with a former colleague of mine Bill Kelty—but I will come back to that later. In terms of Lindsay Fox’s involvement in the industry—apart from his history in establishing heavy vehicle transport throughout the country and his commitment to the ongoing viability of this industry—I think his views are certainly very much respected, at least on this side of the chamber.

The Interstate Road Transport Charge Amendment Bill 2008 enables the nationally agreed heavy vehicle registration charges to be applied to heavy vehicles registered under the Australian government’s Federal Interstate Registration Scheme—or FIRS, as it is known. The new heavy vehicle charges are one component of this government’s broader heavy vehicle productivity and safety agenda and will ensure that the Federal Interstate Registration Scheme charges are consistent with the state and territory registration charges as they apply from 1 July 2008.

Heavy vehicles operate across our country and transport from state to state almost 1.7 billion tonnes of freight, which represents 70 per cent of the total domestic tonnage carried by all transport modes. As many as 365,000 heavy vehicles operate in Australia. As you would no doubt appreciate, Mr Deputy Speaker Schultz, being on the Hume Highway, my electorate of Werriwa experiences a lot of the heavy vehicle transport that operates along the eastern seaboard. The Hume Highway between Sydney and Melbourne is one of our most active interstate corridors, and it carries 20 million tonnes of freight per year. In the lead-up to the last federal election, it was so critical that the then Rudd opposition outline a plan to widen the Hume Highway where significant bottlenecks were occurring. Within the bounds of Werriwa on the Hume Highway, we experience 6,000 heavy transport movements per day.

In raw terms, this bill is about ensuring there is a proper charge applied against heavy transport movements that has regard to recovery against infrastructure with respect to roads. The basis of that, as was agreed by the transport ministers, was to ensure that a fair amount was paid in order to contribute to the preservation of roads and essential infrastructure to allow the passage of this transport. Therefore, the collection of the heavy vehicle charges has the support of state and territory governments, but more importantly the Commonwealth government. This is about ensuring that heavy vehicles pay their fair way in terms of the impact on our roads.

Having just heard the contribution from the Leader of the Nationals, I should indicate that in 2007 the then Leader of the Nationals and transport minister—the member for Lyne, Mr Vaile—put reform of heavy vehicle charges on the agenda of the Council of Australian Governments. He said:

The National Transport Commission will develop a new heavy vehicle charges determination to be implemented from 1 July 2008. The new determination will aim to recover the heavy vehicles’ allocated infrastructure costs in total and will also aim to remove cross-subsidisation across heavy vehicle classes.

Currently the amount of money raised through the heavy vehicle charges does not recover the cost of providing the infrastructure for heavy vehicles. That is the position which underpins this bill and it was certainly the position at the heart of the statement made in 2007 by Mr Vaile.

Recovery of road expenditure is achieved through a fixed registration charge collected by state and territory governments and a road users charge collected by the Australian government. The heavy vehicle charges have not changed since 2001, when it was determined that the charges would recover past expenditure from the heavy vehicle sector. This had the effect of lowering registration fees for some larger trucks, which consequently brought about a situation where they were effectively being cross-subsidised by the operators of smaller trucks. As I stated earlier, an overhaul of the heavy vehicle charges is urgently needed in order to construct and maintain the infrastructure needed for these heavy vehicles. In fact, the National Transport Commission estimates that under-recovery is currently in excess of $100 million per year.

In 2007, the National Transport Commission was asked by the Australian transport ministers, who were directed by COAG as part of the overall transport reform package, to prepare a new heavy vehicle determination to deliver revised charges for introduction this year. This bill deals only with the registration charges. The road user charges are not dealt with in this bill; however the determination increases the road user charge from 19.633c per litre to 21c per litre, indexed annually. To provide industry the opportunity to adjust to the new road user charge, it was agreed in cooperation with the industry that its introduction would be delayed until 1 January 2009.

Under the proposal recommended by the National Transport Commission, there will be a new set of registration charges which will rebalance the contribution of different heavy vehicle classes. The new registration charges will in effect put a stop to smaller trucks paying as much as they do presently—in effect subsidising the larger trucks—and the larger trucks, the B-doubles and road trains, will be required to pay their fair share. This will result in decreases in registration charges for about 25 per cent of the transport fleet, a small increase for about 69 per cent of the fleet, and a significant increase for the remaining six per cent of the fleet—that is, the heavy truck trailers and multicombination vehicles that are currently subsidised by smaller vehicles. To assist the industry to adjust, these increases will be phased in over three years and will better align charges to the impacts of heavy vehicles on our roads. To supplement the determination by the National Transport Commission, the government, after listening to the concerns of the industry, has developed a $70 million, heavy vehicle safety and productivity plan. (Quorum formed)

I had the opportunity to talk to Lindsay Fox and Bill Kelty, together with the member for Maribyrnong, only a couple of weeks ago. It was very refreshing to hear what people who are absolutely committed to this industry have to say about its future and the degree of investment that needs to be made. One thing Mr Fox was talking about was the trial of technology, particularly the electronic monitoring of truck drivers’ work hours—effectively, a black box within the transport industry. As he put it, there are certain charges involved not only with administering it but also with regulating it. He was talking not only of the working conditions of professional drivers but also of the responsibility we have to drivers, their families and, as a matter of fact, all other road users. That is why an organisation such as Linfox is so committed to looking at those aspects of technical development that could be deployed in this industry with a view to enhancing the safety of our heavy transport sector.

Another thing that is being looked at is the construction of more heavy vehicle rest stops and decoupling areas along our highways and on the outskirts of our major cities. Again, that is something that is quite significant. A third thing is upgrades to linkages between our AusLink freight routes and the strengthening of some of our bridges to cope with the contemporary transport we use and its frequency.

Safety in the heavy vehicles sector is paramount not only to those directly involved in the industry but to all road users. We have a dreadful situation where approximately 330 people are killed each year in crashes involving heavy vehicles, a one in five fatality ratio, with three times as many injured. That does not mean that it is just trucks that are at fault; it means ensuring that our roads are maintained so as to accommodate the use of those roads by the heavy transport sector. This is a significant cost to our community; it is a cost which it would be almost immoral to put a value on. There is certainly a fiscal cost to the community of around $2 billion per year. But the cost that road fatalities have on our community is something that we all have an obligation to try to do something about. That is what this bill does: it seeks to recover in the transport sector the moneys to reinvest in better roads and to reinvest in the infrastructure that is ever so necessary if we are to continue to utilise heavy vehicles as the prime transport mode for our domestic product. I commend the bill to the House.

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

I am proud to come to this House and come to Canberra to represent the electors of Grey. One of the things I need to do as I represent the electors of Grey is put forward their interests. Since I have come to Canberra—and I have only been coming here for a few weeks—I have felt as though my electors are under assault. We have had 115 days of this government, and the government’s attacks on rural and regional Australia are setting a pattern. We have had the termination of the Investing in Our Schools Program. We are in the middle of a $2 billion raid on the Communications Fund put aside for rural Australia. In my electorate, it seems as if we have just lost an Indigenous youth festival called Croc Fest. We have had cuts in Exceptional Circumstances funding. We have had the removal of $10 million of support for agricultural research—support put in place to help alleviate the loss of levies grower organisations have at the moment through the drought. So here we have a government proudly claiming to be delivering on its election agenda, but there is a whole stack of nasties out there as well, a whole heap of nasties that we did not know about before the election; in particular, the Interstate Road Transport Charge Amendment Bill 2008.

And there is more in the pipeline. We are already talking about what is going to happen to the Australian technical colleges and Regional Partnerships. Let us face it, the government even had a go at trying to cut the carers payment in the last week, but the public outcry was so great they could not proceed. But rural and regional Australia is an easy hit. They have a go at us and they can get away with that.

The previous Prime Minister often said, ‘We will not abandon rural Australia in its hour of need.’ It seems to me that this government cannot get out fast enough. Labor does not understand or care about rural and regional Australia. We are now seeing the product of wall-to-wall Labor. The last time these proposals were put up by the NTC, the Australian Transport Commission rejected them. That was when the coalition still had a seat at the table. We are not seeing that sense of cooperation now—first meeting and the changes go straight through. My office has had numerous contacts on this issue. Figures bandied around suggest that it will add 13c to a $100 grocery bill. Maybe that is the case when your freight is five per cent of the final cost. I might point out that fuel in the northern part of my electorate is over $2 per litre. That would suggest to me—

Bob Katter (Kennedy, Independent) Share this | Link to this | Hansard source

Why didn’t you introduce ethanol?

Rowan Ramsey (Grey, Liberal Party) Share this | Link to this | Hansard source

I was not here then. That price would suggest to me that we have at least a 25 per cent freight component on fuel. It shows that, in the country, freight is a much bigger component, whether it be 10, 15 or 25 per cent. This impost delivers an 80 per cent increase on the registration of a B-double, rising from $8,041 to $14,340. The Australian Transport Commission adopted the higher road fuel user charge. We are going to see not only a rise in the fuel cost of around 1.4c per litre but also the return of indexation, something that we thought we had seen off. This indexation is not going to be linked to CPI, as all other indexations have been before. This indexation will be linked to the road-building indices, which are rising at a far greater rate than the CPI. Since much of the road-building material has to be brought in, the raise in freight rates will naturally raise the price of the roads. Truckers have no choice but to pass on this cost. One medium-sized operator in my electorate estimates that it will cost his business $160,000 to $200,000 a year. He will have no choice but to pass this on. Truck operators tell me that they expect their freight costs to rise by about six per cent.

My electorate runs on freight. Broadacre agriculture involves big tonnages that must be moved to the port. We have the mining industry. We always pay freight two ways in the country. Six per cent will be added to the freight bill of fuel, fertiliser and industrial inputs. Six per cent will be added to the freight bill of groceries. Six per cent will be added to the freight bill of lettuces, toilets, toilet paper and shampoo. Residents of Grey will pay the freight both ways on everything that comes into and out of their electorate. Higher freight rates will mean higher prices. Higher prices will mean higher inflation. This government has done nothing, if it has not talked about inflation. How many times have I heard the word ‘inflation’ in this House in the last three weeks? Possibly about half as many times as I have heard the term ‘working families’. The working families of the electorate of Grey will not appreciate the inflation caused by these higher rate charges.

The increases that were rejected in 2006 as being an unfair slug on rural Australia were deemed unfair because at that time rural Australia was struggling in the grips of a drought. I ask the other side of this House what they think has changed since that time. I would say that nothing has changed. The drought is still there and rural Australia is still struggling. What are we going to do? We are going to hit them with a six per cent rise in freight prices.

Australia is addicted to fuel tax. We pay fuel tax of around $14 billion a year, yet we are still spending less than half of that on the roads in Australia, even allowing for large increases in road funding in the last four years. The road transport industry and the motorists of Australia are paying more than enough tax already to pay for all the repairs on the road. And there is no guarantee that these increases are going to be spent on the road network anyhow. It is within the government’s power to spend it on whatever they wish. Australia consumes around 37,000 megalitres of fuel a year. I do not have the exact calculations on this, but if you assume that 80 per cent of that is for non-export activity that should lead to about another $5 billion worth of GST receipts, which will be going straight to the states. The states are able to spend more on the roads; they do not need this extra registration slug.

Far from the transport industry not paying their way, at this stage they and the motorists of Australia are carrying the load. The Australian Trucking Association claims that the National Transport Commission’s finding that heavy transport are not paying their way is flawed, that they meet more than their costs and that there is little transparency about this increase. In the light of that, it behoves the government to go back and look at those figures and check to see whether they are correct. Heavy imposts on large combination registration will push freight back onto smaller trucks.

I have just been listening to the member for Werriwa talking about the issue of road safety in Australia. I could not agree with him more. Everybody is concerned about road safety. Every year that goes past we see more and more transport movements on the road, yet our road toll is falling. That is a great testament to the people who run the trucks, it is a great testament to the motorists and it is a great testament to the investment of all governments that have improved roads. No-one more than me would like to see the road toll fall further. But we do have to have a sense of reality here. If we are going to push freight back onto smaller trucks—this is the old argument—why not push it around in wheelbarrows? Why not put the freight back onto 14-tonne trucks? That would mean we would only have small trucks on the road and, when you get hit, it will only be a 22-tonne weakling that runs over the top of your car—and we are going to have five times as many of them. That just defies logic. You cannot have more trucks on the road and be safer. We need to push the loads onto the big trucks to keep the traffic density down. More trucks mean more danger, more greenhouse gases and more congestion, and ultimately it will do more damage to the roads. Much has been written and said over the years about Australia being cursed by the tyranny of distance. In this case we tax to our disadvantage. In an economy like Australia’s, it is nonsensical to tax freight over and above what is necessary to achieve the road network that we need. It taxes productivity—the very thing that builds this nation.

I think there was an estimate in 2002 that the road freight task for Australia will double by the year 2020. I point out that in 2008 we are about one-third of the way through, so the increases that you have seen in the last six years will keep happening. And the idea of pushing freight back onto smaller trucks, of using the motorists and the consumers of Australia as a cash cow not just to build highways but to keep putting money back into the rest of the economy, is flawed. We will pay the price for it in the long term. We need to freight more safely on roads; we do not need more trucks. I conclude my remarks by saying that I believe this bill is an unfair attack on rural Australia. The people in the cities may not understand the implications, but you pay freight on everything you consume and then you pay GST on top of the freight. That tax should be part of the accounting plan for the roads but it is not being counted at the moment. Somewhere around $5 billion of fuel tax delivered to the states is not part of the equation. We need to draw attention back to it. We do not need this extra impost.

Jason Clare (Blaxland, Australian Labor Party) Share this | Link to this | Hansard source

I welcome the opportunity to make a contribution to the debate on the Interstate Road Transport Charge Amendment Bill 2008. Our freight travels the length and breadth of our vast country, from the mines in Western Australia to Port Botany in Sydney, from cattle stations in Far North Queensland to the homes of South Australia. The tyranny of distance is largely borne by our truck drivers. They rely on the road infrastructure that we provide. We need to give our freight movers roads of the highest quality; we need to give our truck drivers rest stops to combat driver fatigue; we need to make the presence of heavy vehicles on the roads safer for the sake of truck drivers and, importantly, for all road users. We need to improve the efficiency of our road network by upgrading our roads and strengthening our bridges. In laying out the obligations the government have to heavy vehicle users, we also recognise that contributions from the freight industry are an important part of the total road expenditure. Successive governments of both political persuasions and many in the trucking industry have supported the contribution towards the cost of road construction and the contribution towards fixing the damage that heavy vehicles do to our roads. Ultimately these contributions directly benefit the freight and road transport industry. This bill will overhaul the existing act and create charges which are more equitable for all truck drivers.

An inquiry into road and rail infrastructure pricing by the Productivity Commission found that currently small trucks are paying too much while larger trucks are paying too little. On advice from COAG, chaired by John Howard, the National Transport Commission recommended that the former government introduce legislation to ensure full cost recovery of heavy vehicle usage and cross-subsidisation of large trucks by smaller vehicles. The Howard government at that time said that those changes were to be implemented on 1 July 2008. The new Rudd government, based on the same recommendations, aims to do the same. Significantly, the government’s bill deals only with registration charges. The implementation of the road user charge will be delayed until 1 January 2009. I welcome the support of the industry for this change. Stuart St Clair, the Chief Executive of the Australian Trucking Association, had this to say:

Minister Albanese has listened to the industry and delivered a strong result for trucking operators and Australian families ...

The bill introduced by the government will reduce registration fees for 25 per cent of the nation’s 365,000 heavy vehicles, distributing the costs to larger vehicles. The greatest increase will be for six per cent of trucks, for the larger trucks such as B-doubles. To ensure minimal impact on the industry, these increases will be introduced over three years. The logic is that those that do the most damage and enjoy the greatest benefits from road upgrades will pay the highest cost.

My experience over the last four years working on the Westlink M7 project in Western Sydney is testimony to the advantages that road freight gets from first-class infrastructure. The M7 is a new freight link through Western Sydney, a 40-kilometre road that connects the M5 to the M4 and on to the M2. It is a road that has made the work of moving freight in Sydney, and particularly in Western Sydney, so much more productive and so much more efficient. The evidence of this can be seen in the heavy vehicles that use the road. On most motorways in Sydney and across the country on most arterial roads you will find that the traffic mix on those major roads is around eight or nine per cent heavy vehicles and the rest smaller vehicles. The M7 has a very different traffic mix: it has in the order of 18 per cent heavy vehicles. Those trucks, those heavy vehicles, are taking advantage of the M7 because it cuts travel time, and time is money. A couple of years ago, the Victorian Transport Association released some information on the real impact of saving time for the freight industry. They gave me some information which indicated that, at that time, an hour saved on the road for a B-double equated to around $100 saved. That incorporated the cost of fuel, it incorporated the cost of labour and it incorporated the cost of maintenance. When all of that was taken into account, a B-double saving an hour on the road saved about $100.

Good infrastructure that cuts time and cuts costs makes business more efficient and more productive. Good infrastructure saves time and money. That is what the M7 does, and that is why I welcome the investment that we see in this bill in new and improved road infrastructure. We can also see these benefits in major upgrades to the Pacific Highway. Travel times have been cut significantly and the route has been opened up to B-doubles, with over 200 B-doubles utilising the road every day—heavy vehicles that are moving from the New England Highway over to the Pacific Highway to take advantage of the travel time savings, and cutting their costs and becoming more productive as a consequence. We can also see the benefits in Victoria, with the $331 million Deer Park bypass, a nine-kilometre four-lane freeway which will improve access to the Western Ring Road and Melbourne Ports, and reduce travel and operating costs for 7,000 heavy vehicle users. Also, we see the benefits on the Hume Highway, where the bypass around Albury-Wodonga has reduced operating costs for heavy vehicles, drastically cutting the driving time between Melbourne and Sydney.

The benefits of these projects have a ripple effect. They increase efficiency and safety, and they increase productivity. When you increase productivity you go a long way towards lowering inflation. But the bill that we are discussing today is not just about boosting productivity or improving infrastructure; it is also about saving lives. This government, through this bill, will invest in driver safety. This government will invest $70 million into the trucking industry and road infrastructure to prevent the loss of hundreds of lives and the thousands of injuries that occur annually on our roads. The road toll can be reduced by using the measures that the minister for infrastructure and transport has outlined: the introduction of black box technology to make it difficult for drivers to drive for too long or at high speeds; upgrades to freight routes and the strengthening of bridges to enable them to safely carry larger, heavier loads; and the construction of more heavy vehicle rest stops and parking areas along highways to reduce driver fatigue. The Monash University Accident Research Centre estimates that road spending on such measures can reduce heavy vehicle related deaths by 38 per cent. That translates into 125 lives potentially saved each year. I commend the minister for working closely with the states and territories and the industry to develop a plan not only to create greater efficiency in the existing road network but also, very importantly, to potentially save lives.

Again, I welcomed the comments in the Australian Financial Review this morning of Stuart St Clair, the Chief Executive of the Australian Trucking Association. He said:

These are very significant changes to the industry, they should not be underestimated ...

I also note that the former minister for transport in his contribution spent considerable energy defending the former government’s investment in road infrastructure. However, his argument is not borne out by the Bureau of Infrastructure, Transport and Regional Economics, which released a report only recently that showed that road funding during most of the Howard government era was about 11 per cent lower than during the years of the Hawke and Keating Labor governments. Federal road funding averaged $2.3 billion a year under the former Hawke and Keating Labor governments but fell to less than $2.05 billion a year under the coalition. There is a lot of work to do to realise the aim of the freight industry: to move more freight, to move it more safely and to move it at less cost. We are just beginning, but I welcome the government’s commitment to this task and I welcome the minister’s contribution to this task.

Nola Marino (Forrest, Liberal Party) Share this | Link to this | Hansard source

I rise to speak on the Interstate Road Transport Charge Amendment Bill 2008, which will enable heavy vehicle registration charges to be applied to trucks registered under the Australian government’s Federal Interstate Registration Scheme. The Interstate Road Transport Charge Amendment Bill 2008 also updates definitions contained in the Interstate Road Transport Act 1985 and establishes a new charge-setting mechanism based on a rate agreed by transport ministers meeting as the ATC.

These updated charges were determined by Commonwealth, state and territory transport ministers at the Australian Transport Council meeting on 29 February 2008. The states and territories will impose the same charges for heavy vehicles that come under their registration systems. Separately, but as part of rationalising the charge-setting mechanism, the Road Transport Charges (Australian Capital Territory) Repeal Bill 2008 repeals the current charge-setting mechanism based on Commonwealth-provided act law, the Road Transport Charges (Australian Capital Territory) Act 1993. The two elements of the charge structure upon the Australian trucking system are through registration fees and the diesel fuel excise system. The determination of the appropriate level of these charges occurs through the National Transport Commission, which makes recommendations to the ATC to recover road expenditure attributable to heavy vehicles.

The trucking industry has long accepted the principle of paying its way, an approach endorsed by all levels of government. All money collected under the Federal Interstate Registration Scheme is paid to the states and territories. These bills make adjustments to the way heavy vehicle registration fees and the diesel fuel excise, known as the road user charge, are determined. The Interstate Road Transport Charge Amendment Bill 2008 grants the ATC the power to determine the charges that will apply to Commonwealth-registered heavy vehicles. The Road Transport Charges (Australian Capital Territory) Repeal Bill 2008 ends the system whereby the Australian Capital Territory set the reference charge for other jurisdictions to follow. The Australian Trucking Association has objected to the proposed increases, and the Australian Long Distance Owners and Drivers Association has opposed both the higher registration and excise costs. However, my main concern is that the Interstate Road Transport Charge Amendment Bill 2008 will require the Commonwealth to always impose the charges agreed to by the Australian Transport Council. The Commonwealth, therefore, will lose its discretion to dissent from the ministerial council and would be unable to determine in its own right the charges that should apply to Commonwealth-registered heavy vehicles.

The Australian Transport Council charges are reference fees used by the states and territories. Should the Commonwealth wish to apply competitive pressure on the charges imposed by the states and territories on their own heavy vehicles, it would be unable to do so; therefore, the Commonwealth will have no capacity to scrutinise these charges. The regulation that stipulates the heavy vehicle registration charges will contain significant increases that will be implemented over three years from 1 July 2008. These increases will arise from the application of an annual road cost adjustment formula—a formula that will result in charges higher than the CPI.

The increase in charges will fall heavily on the already highly productive multicombination vehicles such as B-doubles and B-triples. B-doubles and B-triples carry the more time-sensitive foodstuffs—such as fresh fruit, vegetables, milk and wine—and are highly effective in Western Australia, where great distances are travelled to regional and remote towns. The imposts, therefore, threaten to slow the road freight sector’s improvement in productivity and in environmental performance by discouraging trucking operators from converting from semitrailers to the multicombination vehicles, which will result in even more trucks on our roads.

The second part of the charge structure to be imposed on heavy vehicles comes from the decision by the Australian Transport Council to increase the road users charge from 19.633c per litre to 21c per litre. This will take effect from 1 January 2009 and will be indexed annually to the same formula as that used for registration charges.

The two measures will impose an increasing cost burden on Australia’s struggling truck operators and their families. The measures will also push up prices for everyone. Since trucks carry over 70 per cent of Australia’s domestic freight, the flow-on effect of increased prices will be passed on to all consumers—Australian working families—over many, many goods. For those imposts to occur when so many are hurting due to higher interest rates exposes the Rudd government’s claim to be serious about fighting inflation. It is also an indication of what ending the blame game between federal and state governments actually means—no state Labor transport minister will blame another for imposing higher cost on Australians. They will not have to. It will mean that the government, in one of its first acts in office, will be reintroducing fuel excise indexation by stealth.

Registration costs will be substantially increased, and fuel tax on truck drivers will be increased from 19.6c a litre to 21c a litre. Obviously, any increase in the cost of transporting goods will place upward pressure on interest rates and also impact on the cost of goods to consumers. Any increase in the cost of transportation will hit regional Australia hard, particularly in Western Australia. Regional areas have a particularly heavy reliance on the trucking industry to deliver consumer goods where they do not have access to the rail network. I have great respect for those in the transport industry: they deliver 1.6 billion tonnes of domestic freight. An increase in transport costs will also make Australian exports less competitive and could cost jobs. One in four jobs in regional areas is dependent on exports, and most exports start their journey by road. The Rudd government has claimed that fighting inflation is its No. 1 priority. If these increased charges are adopted then it will prove these claims are nothing more than rhetoric. With fuel prices rising, almost on a daily basis, now is not the time to increase transport costs.

The associated charge framework will result in higher costs on Australia’s road freight sector. Once the measures are fully implemented, the revenue of states and territories will increase by a further $168 million. Far more significant is that there are no guarantees that the states and territories will actually spend this revenue windfall on roads. Although state Labor governments demand that heavy haulage transport pays its fair share of road use, I am very concerned that all the money received from these increased charges will be returned to the states and territories. Where is the accountability and transparency now that the state governments actually direct increased funding back into fixing roads and where will it be in the future?

The vice-president of the Australian Long Distance Owners and Drivers Association recently pleaded in an email that, if the government allows the recommendations of the NTC to go ahead and increases charges for trucks, there will be many who will go broke in this process. The transport industry believes that it does pay its way and has put up with some of the worst road conditions. Many truckies are questioning where their contributions go to, because they cannot see the funds that they have been paying being ploughed back into the nation’s roads by various state Labor governments.

Farmers have also slammed federal Labor’s decision to increase heavy vehicle charges as just another cost burden. Registration fees for 75 per cent of the nation’s 365,000 heavy vehicles will now rise. I agree with the statement made by Leon Bradley, Chairman of the PGA Western Graingrowers, when he warned that the cost increases would erode the competitiveness of WA farmers in international markets and that consumers would pay for the extra tax, because any produce carried around the nation on the back of a truck would now be more expensive. The National Farmers Federation commented that the decision added to a growing list of escalating costs that have hit farmers. They said:

... by arbitrarily increasing the cost of transporting food to local stores, consumers must realise that, ultimately, this means higher prices at the checkout.

Farmers—as price-takers in the supply chain—simply do not have the capacity to absorb these additional costs.

The trucking industry consists of small companies and individuals operating on small margins. Those in the industry know that freight rates are highly competitive. We have some very committed, quality small, medium and large operators in the trucking industry in Australia. Any government decision that forces good operators off the road and out of business should be condemned. The road user charge increases to be delivered in January 2009 will only continue to add to the pressure on the economy and increase prices to the consumer.

The government cannot fight inflation at this rate and with these types of decisions. The government also cannot claim it is putting downward pressure on grocery prices. Effectively, this will do the opposite. The government has already conceded increased freight costs would be passed on to consumers, but its assessment of the increase is a mere $17 per year. The trucking industry has said that Australian families may well have to find an extra $70 in their household budgets each year after the Rudd and Labor state governments increase registration and fuel charges through this mechanism. The Assistant Treasurer yesterday stated that food prices have actually increased 43.6 per cent since 1996. Additional road transport charges will only add to this increase. I have actually contacted road haulage companies and asked the simple question: who will pay? The simple answer is: the ultimate consumer.

The new plan to maintain the nation’s roads is to increase charges for 69 per cent of the nation’s 365,000 heavy vehicles by between one and 10 per cent. That is the additional cost to these particular operators. Six per cent of the fleet, the biggest vehicles on the road, will be hit with even higher increases, with the rise phased in over three years. Registration fees for some classes of licences will rise from about $8,000 or $9,000 a year to $20,000 a year, and of course those increases will have to be passed on to consumers. The state Labor government is happy to have this windfall and it says there will be more money for infrastructure spending—but, again, where is the accountability and where is the transparency? How can the trucking industry be assured that the funds generated by this will actually be spent on road infrastructure?

Continued Australian government investment in strategically important freight corridors through the AusLink program has been and continues to be vital to the national economy, with official forecasts indicating that growth in the road freight task will continue to outstrip growth in the aggregate economic activity over the period to 2020. The provision of quality and well-targeted road infrastructure is the leading contributor to productivity growth in the trucking industry. Therefore, there is an urgent need for more spending on road infrastructure for important AusLink freight corridors in urban areas.

I am also concerned that, with the establishment of the government’s Infrastructure Australia, and the development of the national infrastructure priority list, there may be calls for funding to be diverted from important road projects to other infrastructure priorities. The Bunbury outer ring road was promised by Labor during the campaign, and I am hoping that that will be delivered as a matter of priority. It may also allow the government to delay the implementing of road projects for referral to the assessment processes of Infrastructure Australia.

I am deeply concerned that federal Labor will drastically reduce road funding around Australia and therefore reduce road safety. The B-doubles and B-triples, the bigger, longer, higher mass carriers, have proved to be the safer and more productive combination. The federal government needs to encourage the use of these combinations and deliver on road infrastructure to keep Australia moving and improving. As the CEO of the Australian Trucking Association, Stuart St Clair, said:

Australia’s new national transport policy will only be a success if it focuses on boosting the trucking industry’s productivity and not on slugging the industry with even higher charges ...

I strongly oppose this bill on the basis that it will increase the cost of living and the cost of doing business and is actually an attack on rural and regional Australia.

Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

I rise to support the Interstate Road Transport Charge Amendment Bill 2008 and related bill. The bills enable a nationally agreed new heavy vehicle registration charge to be applied to heavy vehicles registered under the Australian government’s Federal Interstate Registration Scheme. These bills are the result of deliberations by COAG, the Council of Australian Governments, and were unanimously endorsed by all ministers at the Australian Transport Council meeting on 29 February 2008.

The Rudd government take economic reform very seriously and the Interstate Road Transport Charge Amendment Bill 2008 is a very important part of our ongoing plans to build a modern and prosperous Australia into the future. The Council of Australian Governments deliberated on this bill—and the issues facing the transport industry—and unanimously endorsed it. The bill forms part of a three-pronged strategy to improve fairness in the distribution of funding in relation to heavy vehicle use in our transport industry. Those three prongs are the heavy vehicle registration charge, a slight increase in the road user charge and a $70 million heavy vehicle safety and productivity package. So this bill forms part of an overall plan—and that is what we are about. We are about planning and building a stronger Australia and a stronger economy into the future.

I come from the electorate of Leichhardt. I am a proud citizen of Cairns and have a rural and country background. This evening I have heard members of the National Party banging on about their representation of rural and regional Australia. They are a dying breed in Queensland in terms of federal politics and the reality is that they are dying because they do not effectively represent rural and regional Australia. I am a proud member of the Australian Labor Party and I am working very hard to ensure that rural and regional Queensland are represented. We understand how important road transport is to Australia. It is particularly important to my local community of Cairns and my electorate of Leichhardt. Cairns, up there in tropical North Queensland, is a long way from Brisbane, from Sydney, from Melbourne and from other capital cities. We depend on the Bruce Highway. We depend on heavy vehicles to bring in the basics, whether it is food or basic materials such as nappies and medications. For the common things that everyday working families need we rely on the road transport system and the road transport network to deliver, and we understand how very important it is that we continue to build and support a strong economy and make sure the road transport network and heavy vehicles are actually operating effectively within this country.

Not only does the system bring in goods, though; we also export a lot of goods. I have heard the National Party members today talk about representing rural Australia. I am proudly from a country background and I know that a lot of bananas and a lot of mangoes come out of North Queensland. Heavy vehicles take them out. The road transport system is a very important part of dealing with that and ensuring that we support those local industries and those local communities.

The National Transport Commission estimated that, under the current system, there is an under-recovery of the cost of providing infrastructure to heavy vehicles in excess of $100 million per annum. So it was estimated not by the Labor Party, the National Party or the Liberal Party but by the National Transport Commission that, under the current system, we get an under-recovery of $100 million per annum. So there is need for reform, and we recognise that. The system unfairly places a heavier burden of cost recovery on small trucks at the expense of large vehicles. Effectively, small trucks are cross-subsidising the impact of large trucks on the road network.

In April 2007, the Council of Australian Governments directed that, as part of an overall transport reform package, Australian transport ministers should require the National Transport Commission to prepare a new heavy vehicle determination. In its determination, the National Transport Commission recommended a new set of registration charges that rebalance the relative contributions of the different heavy vehicle classes. This is a fairer system of allocating the cost of heavy vehicle transport—and it is no wonder that we are getting a fairer system under a Rudd Labor government.

Sharon Bird (Cunningham, Australian Labor Party) Share this | Link to this | Hansard source

Order! The member will restrain himself.

Jim Turnour (Leichhardt, Australian Labor Party) Share this | Link to this | Hansard source

Successive governments, at both Commonwealth and state and territory levels, have supported the principle of cost recovery from heavy vehicles. Successive governments, at both the Commonwealth and state and territory levels, have supported the principle of cost recovery from the heavy vehicle industry for road construction and maintenance costs incurred through the collection of heavy vehicle charges. So successive governments, including the previous Howard government, have supported this approach.

In a speech given on 28 June 2007 entitled ‘The coalition government’s transport reform agenda’, the member for Lyne, then federal transport minister and Leader of The Nationals, said:

The National Transport Commission will develop a new heavy vehicle charges determination to be implemented from 1 July 2008.

The new determination will aim to recover the heavy vehicles’ allocated infrastructure costs in total and will also aim to remove cross-subsidisation across heavy vehicle classes.

So the then minister under the Howard government was moving to implement these sorts of reforms. We have the current opposition, led by the Leader of the National Party today in terms of this bill, basically now opposing this. We have heard that since the election the opposition does not really know where it stands. It does not know where it stands on this bill, effectively, and it does not know where it stands on the basic things that are important to working families, like industrial relations legislation and climate change. The contributions by those opposite to the debate on this bill today are another example of the opposition having lost its way and not understanding that working families, the Australian community, is looking for economic reform and leadership, and that is what the Rudd Labor government is providing. As I have said, the previous minister supported these reforms.

If we want to build a modern Australia equipped for the 21st century, we must continue with economic reform. We are a government that listens and responds to industry and the community. Prior to the introduction of this bill, the National Transport Commission undertook comprehensive consultations to inform its final recommendations. This also was begun under the previous minister, who actually had some direction in terms of transport reform. As a result of these consultations, the National Transport Commission made a number of changes in terms of its recommendations. The determination proposed by the National Transport Commission recommended a new set of registration charges that rebalanced the relative contribution of the different heavy vehicle classes. Under the determination recommended by the National Transport Commission, registration fees for 25 per cent of the nation’s 365,000 heavy vehicles will be cut, while the fees on 69 per cent of the fleet will rise by between one per cent and 10 per cent. So there will be some rise for 69 per cent, but that rise will be between one and 10 per cent—not the huge increases that we have heard about in contributions from the opposite side of the chamber.

Some larger increases are proposed for the six per cent of heavy vehicles that do not pay their fair share—because at the heart of our changes is ensuring that everybody pays their fair share. We do not want to see cross-subsidisation from small truck owners to large truck owners and B-doubles. Going to the heart of these reforms is making sure that we get people paying their fair share—making sure that, in terms of economic reform, we are seeing a user-pays approach and that proper decisions are made within our economy in terms of how we transport and move freight within Australia.

These new charges will result in larger trucks, the B-doubles and road trains, paying more in registration charges. But, to assist the industry to adjust, these increases will be phased in over three years—because we do listen and we recognise that reform takes time. We are going to allow for these changes to be phased in over three years, particularly for the larger trucks, the B-doubles and road trains, that will be impacted most heavily by these changes. These changes will also result in a reduction of charges for smaller trucks. No longer will owners of smaller trucks have to subsidise B-doubles and road trains. These changes better align charges to the impacts of those vehicles on our roads, so they better align the charging system into the future.

This determination will also increase the road user charge by a small amount—from 19.633c per litre to 21c per litre—indexed annually. But again, after consultation—because we are a government that listens to industry and to the community—we have decided to delay this increase until 1 January 2009. The previous minister’s plan, under the former government, proposed to bring it in on 1 July this year and not six months later, as we have decided to do because we recognise that we need to listen and we need to support industry as it takes on these reforms. This charge is not part of this bill before the House but a separation declaration under a tax act.

It is nice to see that the fact that we listen and respond to the community, to working families and to the trucking industry has been recognised by the Australian Trucking Association. In a media release dated 29 February 2008, entitled ‘Rudd government listens to trucking industry’, the CEO, Stuart St Clair, from the Australian Trucking Association said:

The trucking industry and working families will benefit from the Australian government’s decision to delay increasing the fuel tax paid by trucking operators ... Minister Albanese has listened to the industry and delivered a strong result for trucking operators and Australian families ...

That is exactly right. Mr St Clair has hit the nail on the head. We are delivering for working families and we are listening to the trucking industry. These reforms are needed, but we are implementing them in a way that ensures that we reduce the burden on the trucking industry. He goes on to say—and this is a very interesting quote from that media release—that the minister:

... inherited a proposal that the National Transport Commission developed under the previous government.

So we on this side of the House, the government, inherited a proposal developed by the previous minister, yet we have seen the opposition today running away from that position. They are running away from taking the serious economic reforms that are needed for this country so that we can grow and strengthen our economy and ensure that we meet the challenges of the 21st century. Even the previous minister understood that reform was needed. The Leader of the National Party, who started this debate today, has basically run away from that reform because the current opposition have lost their way. They do not know what they stand for and their reaction to this bill is another example of that.

A further outcome of our deliberations and our consultation is—and I touched on it earlier—the fact that we need to improve safety in the heavy vehicle industry, and we also need to improve productivity. After these consultations the minister included in the determinations a $70 million four-year heavy vehicle safety and productivity package that will fund three components: trials of technologies that electronically monitor a truck driver’s work hours and vehicle speed; the construction of more heavy vehicle rest stops and decoupling areas along our highways and the outskirts of our major cities to assist truck drivers’ rest; and bridge-strengthening projects and upgrades to linkages between existing AusLink freight routes, enabling access to those roads by more productive, heavy vehicles. So we have listened, and we are introducing a $70 million safety and productivity package.

This commitment is critical to improving road safety in Australia. The National Road Safety Strategy targeted a 40 per cent reduction in road deaths by 2010. This is unlikely to be achieved, which is disappointing, and I know that is part of the reason the minister responded with this package. We are determined to work on improving road safety; this plan is part of our commitment to work in partnership with the states and territories and with the Australian Trucking Association and truck drivers. About one in five road deaths involves heavy vehicles, with speed a factor in around 30 per cent of these crashes and driver fatigue in up to 60 per cent of them. We need to tackle speeding and fatigue within the heavy vehicle industry if we are to reduce the road toll. So we do take this seriously, and components of this package will allow us to trial some new technologies in reducing speeding and fatigue and also to provide truck drivers with new facilities, allowing them to rest and take a break when they need to. These are very important reforms and very important components of our overall plan in terms of delivering for working families and the trucking industry in this country.

The third component of this package deals with productivity. I have heard some of the contributions from members of the National Party this evening on this bill, where they talked about Labor not understanding productivity. They should understand that under their 11½—close on 12—years of government, productivity effectively declined to the point that in the year to the December quarter we had zero per cent productivity growth. This is below the long-term trend of 2.4 per cent—that is a fact. On the other side of the chamber they can bang on about productivity, but productivity is at zero per cent at the moment. We have got inflation at 16-year highs, the second highest interest rates in the world and productivity at zero per cent, and there is no plan from the opposition for the future of the Australian economy. This bill is part of our package to strengthen Australia and to build a stronger Australian economy into the future, because increasing productivity is the key to growing and strengthening the Australian economy. Our plan provides for targeted investment which will open up more roads to heavy vehicles, freeing up the movement of freight and easing congestion. So the third component of that $70 million plan—the bridge strengthening and connecting of our road transport network—is about improving productivity within the Australian economy by allowing our road transport and freight to be more effectively connected and to more efficiently and effectively move freight around this country. The government will consult with industry and the state and territory governments to determine the best combination of projects for the use of this $70 million, because we do listen and respond not only to industry but to the community and working families. We take productivity seriously. That is why we will be investing in infrastructure and the education revolution.

I want to take the opportunity in my closing remarks to pick up on the statements made about productivity. If we are serious about tackling the problems with productivity then we need to make sure that we invest effectively in our infrastructure and in skills in this country. That is why bills like this, which ensure that we get a fair distribution of the costs of road infrastructure to heavy vehicles, are part of an overall plan. That plan involves Infrastructure Australia auditing and ensuring that we have a plan for future investment in our road, rail and port infrastructure and involves our education revolution to tackle the skills crisis. Productivity has reached zero per cent in this country; we need a plan to tackle that and to ensure that we build a strong economy that meets the challenges that confront us in the 21st century.

In closing, I commend this legislation to the House. I believe it is a good reform that was supported, effectively, by the previous government. The current opposition do not really have a position on a whole range of different areas. This legislation is just another example. They are effectively talking about productivity and talking about the fact that it might impact on grocery prices. I will take up that point very quickly in my last few minutes and mention the regulatory statement underpinning this. The Australian Trucking Association indicated in their submissions that this legislation will have negligible impact on grocery prices. In fact, I understand that 30c a week was the Australian Trucking Association estimate in terms of grocery prices, and I think that between 7c and 17c on a $100 basket of groceries was the assessment in the regulatory assessment of this legislation. So it is not going to impact on grocery prices. It is going to provide economic reform going forward to ensure that we build a strong economy and that we deliver for working families, for the trucking industry and for the broader community.

Gary Gray (Brand, Australian Labor Party, Parliamentary Secretary for Regional Development and Northern Australia) Share this | Link to this | Hansard source

I rise to speak on the Interstate Road Transport Charge Amendment Bill 2008. I am pleased to be able to contribute to this important debate. This bill introduces new road user charges and new road safety measures. I heard from the speaker opposite that the former government rejected many of the recommendations that we are about to address in this bill. The reality is that the former government did not reject the idea of these road user charges or their increase; they merely parked them under the carpet because they were too afraid to address these issues at a critical electoral time in 2007 when the former government knew they were in trouble. Under the carpet they also stuck the inflation numbers and the low productivity numbers.

In this legislation, we are addressing critical issues to do with our road transport infrastructure. You know as well as I do that an efficient economic framework which sends and receives correct price signals is a key component of a market economy. This bill receives and sends price signals to the road freight transport industry and will set a sustainable economic framework for Australia’s heavy vehicle users. It will implement principles and policies which have had bipartisan political support as well as endorsement from the trucking industry, the rail sector and highly credentialled economic advisers such as the Productivity Commission. Successive governments have supported user pays and cost recovery. Successive governments—at both state and territory levels of all persuasions—have supported the principle of cost recovery from the heavy vehicle sector. That heavy vehicles should pay their way is at the core of this principle.

In response to the 2005 national competition policy review, in February 2006 the Council of Australian Governments, COAG, led by the former Howard government, agreed to a new national reform agenda. This agenda was aimed at providing a supportive market and regulatory framework for productive investment in energy, transport and export infrastructure by improving pricing and investment signals as part of a competitive market. The agenda also focused on establishing measures to ensure the efficient use of export infrastructure. COAG and of course the former government agreed to a series of transport measures aimed at improving the efficiency, adequacy and safety of Australia’s transport infrastructure and committed to a number of high-priority national transport market reforms.

In early 2006, following the failure of the states and the Commonwealth to agree to scheduled new charges, COAG asked the Productivity Commission to examine the issues of road and rail pricing—COAG, being the instrument of the former federal government. The Productivity Commission were also asked to develop proposals for efficient pricing of road and rail freight infrastructure through consistent and competitively neutral pricing regimes. Throughout 2006, the Productivity Commission, under the former government, undertook their inquiry into road and rail freight infrastructure pricing. This involved extensive industry and stakeholder consultation and the development of a draft and final report to COAG—all done under the former government. The Productivity Commission noted that efficient freight infrastructure is of particular importance to Australia given its dispersed population and production centres. It also said that pricing and regulatory arrangements are hampering efficient provision and productive use of road and rail freight. The commission also noted that maintaining cost recovery for road freight infrastructure is an important objective. And it is cost recovery that we are talking about here not tax increases. Our heavy vehicle charges regime scrupulously ensures that heavy vehicles are not overcharged.

In April 2007, COAG—again, led by the former Howard government—considered the Productivity Commission’s findings. COAG fully endorsed the findings and agreed to a comprehensive, long-term reform agenda for road and rail freight infrastructure pricing and investment decision making. This agenda builds on and reaffirms COAG’s commitment to measures agreed to in February 2006—again, under the former government—to ensure that policy and regulatory settings promote timely and efficient investment in and the use of land transport infrastructure to enable Australia to meet the growing freight task and maximise economic growth.

COAG agreed to a phased road reform plan, focusing on the reform of road pricing. The three-phased approach focuses on immediate efficiency enhancements from regulatory reforms and improved decision-making frameworks. As a first step, COAG requested that the National Transport Commission—the NTC—undertake a new heavy vehicle charges determination. That was the decision of the former government. COAG specifically directed that the new determination would ensure that charges would deliver, and continue to deliver, full recovery from heavy vehicles of their allocated share of infrastructure costs in aggregate and remove cross-subsidies across heavy vehicle classes.

It is noteworthy that those opposite have expressed opposition to this bill. They have always been part of the dialogue on this important issue; this is not something that has cropped up overnight. This is a difficult decision, and we understand that, but the distinction between the Rudd Labor government and our predecessors is our preparedness to make the hard decisions in the name of addressing our national infrastructure needs. This bill is part of COAG’s ongoing work and sets registration charges that, when combined with the new road user charge, fully meet COAG’s request.

During 2007, the National Transport Commission undertook a comprehensive consultation process which informed its final recommendations. Flowing from these consultations, the National Transport Commission made a number of changes to its recommendations to take into account stakeholder feedback on the draft regulation impact statement. The National Transport Commission further discussed these subsequent changes with industry and government, across jurisdictions, to ensure that they appropriately reflected industry feedback. The recommendations contained in the National Transport Commission’s heavy vehicle charges determination establish a new set of registration charges which ensure that heavy vehicles pay their fair share of road construction and maintenance costs. The new charges seek to address the balance of cost recovery from different classes of heavy vehicles, ensuring the removal of cross-subsidies between heavy vehicle classes. In order to remove the cross-subsidies and ensure aggregate cost recovery, the new charges will result in increases in registration charges for larger trucks such as B-doubles and road trains.

Australians have come to expect a world-class service for the movement of fresh food, building materials, imported goods and resource materials for export—to name a few. There is no doubt that Australia’s road transport industry has delivered and will continue to deliver for consumers and suppliers alike. But to continue the service that we all expect from the road transport industry, the industry must be given the tools it needs. Year in and year out, the road transport industry invests billions of dollars in state-of-the-art trucks, including smart suspensions and trailing gear. Furthermore, the industry is acutely aware of exhaust emissions and its responsibility to address these emissions. The role for government is to ensure that safe, efficient roads are there for this industry to access. As I have heard more than one truckie say, ‘Everything in this country is delivered on the back of a truck—except for a baby.’

To ensure that the increases can be better managed and to soften their impact, the charges will be phased in over three years. The removal of cross-subsidies will result in a reduction in registration charges for many smaller trucks. For the first time, operators of smaller trucks will not have to subsidise the larger trucks’ share of road construction and maintenance costs. The determination also recommended increases in the road user charge from 19.633c per litre to 21c per litre.

On Friday, 29 February, Australian Transport Council ministers considered the National Transport Commission’s final heavy vehicle charges determination recommendations. After careful consideration of the outcomes of the public consultation process and the impact that new heavy vehicle charges will have on the heavy vehicle industry, Australian Transport Council ministers voted unanimously to support the new charges determination. Transport ministers considered that the new heavy vehicle charges reach an appropriate balance. We now have the mechanism for achieving that balance and satisfying the requirements set forward by COAG in April 2007. That is the COAG established and run by the former Howard government. In reaching the decision to approve the new determination, the Australian government announced that it would postpone the recommended increase in the road user charge from 1 July 2008 to 1 January 2009. Delaying the increase in the road user charge will help to smooth the transition to new charges for heavy vehicle operators. This is in addition to the phasing in of the registration increases.

The increase in the road user charge is not part of the bill before the House but a separate declaration under the Fuel Tax Act 2006, which was tabled in both houses last Thursday. This is an important microeconomic reform. It implements the longstanding commitment by all parties for appropriate charges for the heavy vehicle industry. At the same time that we are implementing this important economic reform, the Rudd government recognises that more needs to be done to assist the heavy vehicle industry in addressing major road safety issues. We have decided to supplement the implementation of the new charges with a $70 million, four-year heavy vehicle safety and productivity package that will fund areas such as trials of technologies that electronically monitor a truck driver’s work hours and vehicle speed; the construction of more heavy vehicle rest stops and decoupling areas along our highways and on the outskirts of our major cities to assist truck drivers’ rest; and bridge-strengthening projects and upgrades to linkages between existing AusLink freight routes, enabling access to those roads to more productive heavy vehicles. The government will consult with industry and state and territory governments to determine the best combination of projects for expenditure of the $70 million package.

The Rudd government has made some difficult decisions since taking carriage of this issue. The former government did not make difficult decisions. As I said earlier, it pushed the difficult decisions under the carpet where it pushed its inflation numbers and its productivity numbers. Our decisions to implement the $70 million safety and productivity package and to delay the implementation of the road user charge until 1 January 2009 were taken after we listened carefully to the views of the heavy vehicle industry and other key stakeholders. I note that key stakeholders like the Australian Trucking Association have expressed strong support for the introduction of the new safety and productivity package and the delay in the increase in the road user charge. I also note that the new charges will encourage state and territory governments to facilitate access of higher productivity vehicles to the road network. This, in turn, will make better use of the nation’s infrastructure—a key element of the Rudd Labor government’s plan to raise productivity and thereby fight inflation and maintain economic growth. I commend the bill to the House.

Barry Haase (Kalgoorlie, Liberal Party, Shadow Parliamentary Secretary for Infrastructure, Roads and Transport) Share this | Link to this | Hansard source

I have listened with interest to the member for Brand and I congratulate him on a very well disciplined performance on behalf of the government. It must have galled him somewhat because he does know the impact that this legislation will have on the trucking industry and, more importantly, he knows the impact it will have on north-western Australia and the cost of living.

I am delighted to be able to speak against the Interstate Road Transport Charge Amendment Bill 2008 this evening because this bill will do all of the things that this Labor government have said they will undo. It will increase grocery prices—absolutely; there is no doubt. For the trucking industry, of course, it will increase fuel prices, when another pre-election commitment from Mr Rudd, the current Prime Minister, was that he would contain fuel prices. It will increase the cost of construction of dwellings and therefore impact directly on housing affordability. So a disciplined performance it was indeed from the member for Brand, because he is a member of the government and he is not—most assuredly he is not—representing the constituents of north-western Australia.

This bill has been introduced to the House in order to make changes that will allow at some point in the future an increase in the registration charges for rigs. How on earth can you increase the charges for anything and not impact on inflationary pressures? I thought that was another promise by the incoming Rudd government—that inflationary pressures were going to be reduced; that the pain of working families was going to be eased. Let us talk about those working families, because many of the families of Australia today are in fact non-working families. I will explain to you in detail just how this bill will help keep those non-working families as non-working families. This whole proposition has been whitewashed on the basis that the industry, if it suffers increased charges, will simply pass those increased charges on to the consumer. The wholesale consumer, the freight industries, will pass those additional costs on to their retail consumers. We are led to believe that somehow those additional costs will simply evaporate into the ether. It does not work like that in all situations, if in any.

I have a situation back in my electorate, which I am passionate about, where the trucking industry has come to me and said: ‘This is a no-go zone. For years, the Howard government kept increases at bay by using the discretionary measures of the transport minister to curtail the increases nationally.’ The member for Wide Bay, Warren Truss, to his credit, in a previous government did just that. Contained in this legislation is the fact that the Commonwealth minister must agree to the proposition put up by the council—the ministers, that is.

In my electorate we have a situation where the transport industry is involved to a great degree in the transport of ore from a mine site to a milling site, sometimes over a distance of hundreds of kilometres. That ore is milled, and the resultant gold is sold onto a world market. The world market dictates the price of that gold. All that these increased transport costs will do is to increase the operating costs to the transport industry and the operating costs for the mining industry. And the mining industry will not be in a position to simply increase their revenue. They rely on a world price. So what will that mean in mining industry boardrooms around the nation? Instead of them looking at a prospective development and saying, ‘Yes, we can separate revenue from mining costs to the degree that we can give this project a tick and go ahead,’ these increased costs will make the difference between that new project going ahead or not—and the member for Brand knows that. If those projects do not go ahead, prospective employees will not be employed. Should they be unfortunate enough at this point in time to be on welfare, they will stay on welfare. It is irrefutable that these increases will directly affect those hard-working, struggling families that the leader of the current government loves to talk about.

You might say, ‘How on earth can it be that these increases will have such an impact on the profitability of mining operations?’ I will give you a case in point. These transport companies shift ore using A-class trailers. A-class trailers, as a single part of the popular rig for the transport of ore, currently have a registration cost of $355 per axle. Each trailer has three axles. The proposed new registration cost for these A-class trailers is $2,000 per axle. That is not an insignificant sum, and I assure you that it will impact on the mining industry, it will impact on the viability of Western Australia as a state supporting the whole nation currently and it will impact on would-be working families. More importantly, this change makes a mockery of the publicly stated aspirations of this government about making our transport system safer.

The information that has been provided by the Refrigerated Warehouses and Transport Association of Australia shows that the current rate for registration of a B-double bogie-drive tri-axle is $8,041 per annum. The B-double combination is considered by the transport industry to be the safest, most economical use of diesel on the bitumen. They shift a substantial amount of payload—about 37 tonnes per unit. They shift it efficiently and they shift it safely. The use of B-doubles means that there is a minimal amount of transport traffic on the road. The more traffic that you put on the road the more frustration that is caused for the motoring public in Australia—the grey nomads, those who tow caravans and those who are moving from city to city on country roads.

According to the proposed new registration charges, the registration for a B-double bogie-drive tri-axle will increase from $8,041 per annum to $14,340 per annum. Is that an insubstantial increase? Not on your life. It is a very substantial increase; it nearly doubles the cost. Smart transport operators—certainly those in my electorate—will go back to the old semi—the semi bogie-drive tri-axle—because they are presently registered at $5,084 per annum and will increase to $5,220 per annum. They carry a payload of 24 tonnes. The transport industry will be faced with carting 37 tonnes—that is 50 per cent more—at almost three times the price per annum for the registration of that rig. It is absolutely unacceptable. If they make the change back to the semis at about a third of the cost per annum for two-thirds of the payload, more prime movers will be on the road, more fuel will be consumed, there will be greater hazards for the other motoring public in Australia and the environment—another issue that this government is concerned about—will be impacted upon by the additional litrage of diesel consumed in a year on the roads of Australia. It is not rocket science. This legislation flies in the face of all those public statements that the government have made about wanting to reduce the impact of inflation and wanting to reduce the cost of groceries, fuel and housing—increasing housing affordability, they say in a very lofty manner. To have some semblance of understanding as to how on earth they can get away with it requires rocket science.

Under the previous government, our Minister for Transport and Regional Services rejected the suggestion that federally these interstate registration rates should be increased. He said, ‘No, there is no way that we are going to contribute to inflationary pressures.’ This government says, ‘We want to pull down inflation, but we want to take the registration costs for a B-double from $8,000-odd to $14,340.’ That is not going to impact on inflation? You would have to be a rocket scientist to understand that. If this government is seriously concerned with maintaining office in the long term and convincing the Australian public that it is dinkum about the reduction in the cost of groceries, the reduction in the cost of fuel and the reduction in the cost of houses—that is, improving housing affordability—how on earth can it argue for an increase in registration costs for transport rigs? It is incomprehensible.

Western Australia, the powerhouse of the nation right now—and I have 91 per cent of it in my electorate—is suffering a skills shortage. If we create an economic situation where it is advisable for transport industries to put more prime movers on the road to carry the same amount of freight, they will be looking for more drivers. Where will they get them? We cannot house them in Port Hedland or Karratha because of state government actions, and there is no way that we could build houses for these staff because LandCorp have got such a monopoly on land development over there. One of my outstanding transport operators, frustrated with the lack of accommodation in Port Hedland in the last 18 months, bought a pub. He had to buy the local hotel to accommodate his drivers.

This move has been portrayed as very soft and insignificant, as having minimum impact that will allow costs to be passed on and as having no significant impact whatsoever. Nothing could be further from the truth. Tonight I have heard Stuart St Clair from the Australian Trucking Association so frequently quoted. They just love his grab that said:

The trucking industry and working families will benefit from the Australian Government’s decision to delay increasing the fuel tax paid by trucking operators

That is like saying that we are sentencing you to death but we will delay it a little while. I could hardly believe it when I found this selective quotation in the minister’s speech, because it is one of the very few things that were said by Stuart St Clair that was in any way complimentary to the introduction of this legislation. He said reams of other things that absolutely criticised this government pushing through this legislation at a time when the economy cannot stand it and when it will simply add to inflation. The proposed bill additionally takes away any ministerial discretion. If this government were fair dinkum about doing the things that they promised before the election when they said to the Australian people, ‘We are your saviours, we are your white knights; vote for us and the world will be a better place,’ how on earth can they sleep at night? This piece of legislation is absolutely perfect in demonstrating the hypocrisy of this leadership. The Australian public, through this opposition, will learn of that hypocrisy, and learn it fast.

Bruce Scott (Maranoa, National Party) Share this | Link to this | Hansard source

I rise to speak on the Interstate Road Transport Charge Amendment Bill 2008 before the House this evening. This new Labor government says that it will govern for all Australians, but this is the biggest slap in the face that I have ever witnessed from any government in its first 100 days of government. It is a slap in the face for the people who live outside metropolitan Australia. The tax rise that will accrue over time from this bill is going to impact not only on the very productive sector, the wealth-generating sector of our country, but also certainly on working families. We have heard a lot about working families from the government—working families and their costs of living. It is certainly going to impact on the resources sector—the coalmining, the oil and the gas industries, the industries which are so vital to job generation and wealth creation in our country. It is going to impact on those industries. There is not a sector of our community—the resources and agricultural sectors and the families who live in rural Australia and work in the jobs which are obviously created from these sectors—that will not be affected adversely by the passage of this bill.

I represent an electorate that is almost half the land mass of Queensland, although my electorate is not quite as big as the electorate of the member for Kalgoorlie. Located in my electorate is the Surat coal basin, the largest coal reserve in Australia. It is unexploited at the moment, but over the next two years these resources will be developed by international mining companies, with demand coming from overseas, particularly from China. In the far west of my electorate—in fact, near my home town of Roma—we have the gas industry. We have coal seam methane gas. We also have gas right out in the Moomba and the Jackson oilfields and the Cooper oil and gas basin. These resources rely on the trucking industry to bring the goods and the machinery in and to service these great resources. The gas industry in the Cooper basin, with pipeline connections to Adelaide, Melbourne, Sydney, Brisbane, Mount Isa and Townsville, is driving industry and generating electricity—electricity needed by all Australians on the eastern seaboard. It is clean electricity in many cases, particularly when gas is used. I have seen the trucks that go out to the Cooper oil and gas basin and service these oil and gas wells. One company alone has brought in huge oil and gas drilling rigs from America. They have to go out over very unfriendly dirt or gibber roads. They are not sealed roads; they are not main highways. These are roads in very remote parts of Australia. These companies will be impacted upon by this legislation, should it pass both houses of this parliament.

Last year I made a visit to the Inaminka hot rocks geothermal power station that was under construction in a very remote part of Australia. That will generate clean electricity and will have an impact on Australia’s carbon footprint because it is a zero emission. You drive out there on dirt roads, and the trucks that have to go in to service those rigs that are drilling into these hot rocks that will generate electricity for consumption within Australia will also be adversely impacted upon as a result of this bill. What will happen to electricity prices? If we just take a look at the oil and gas industry and the geothermal plants and the hot rocks in Inaminka in the western part of my electorate and just over the border in the seat of Grey in South Australia, we can see it is going to add to the cost of production and that will have to be passed on to their consumers. As the member for Kalgoorlie asked, will that be inflationary? Of course it will be inflationary. We have the Prime Minister coming into this House every day, we have the Treasurer out there on the stump and we have the Minister for Finance and Deregulation saying that there is a great big inflation bubble coming; it is a legacy of the previous government, for heaven’s sake! I reject that notion for a start, but if there is one thing this bill will do it will be to drive up the cost of production for electricity, the cost of doing business for the mining sector and the cost of sending basic food items to and from points of production, whether it is into the cities or back out into these rural communities. The cost of freight will inevitably rise because of the passage of this bill. That is going to be inflationary.

I cannot, for the life of me, understand—but maybe I should understand. This is a very unfriendly government—or an inexperienced government; that is probably a better word. It is a very inexperienced government. I cannot for the life of me understand how this government, in its first 100 days, having been given a mandate to govern for the next three years and having not spoken about this in the federal election campaign, could introduce a bill to increase taxes on our transport sector in Australia. Out there, during the campaign leading up to the 24 November election, did the now Prime Minister and the now Treasurer—or the now transport minister, the now finance minister or any of those on the front bench, back bench or middle benches—say to the people of Australia, ‘If we are elected we are going to increase taxes on the transport sector in Australia, which will clearly be inflationary’? No, they did not.

The other disturbing part of this bill, should it pass both houses, is that the increase in the per-litre fuel tax, which will apply to the trucking industry as of next year, is also going to be indexed into the future. And it is not going to be indexed to the CPI; it is going to be connected to the cost of building roads in Australia. We know that the cost of building roads in Australia is going to increase, and does increase, at a greater rate than the CPI. So not only is this going to impact on the cost of building roads, because there are going to be extra taxes on the transport sector that are involved in the construction of roads, but also it is going to then be automatically indexed so that this tax will rise year after year without the government having to come back to the parliament or go back to the people and ask them whether they agree with that automatic indexation.

The same applies to the registration charges that are being imposed as a result of this bill. Firstly, they are certainly going to be increased across the nation. In my own electorate of Maranoa I see many, many large trucks: type 2 road trains, B-doubles and B-triples. A vital part of the freight task in Australia is being carried on roads across Australia. Tragically, in Queensland and many of the other eastern states, as we lead into what I hope is going to be a very big grain harvest this year, we are no longer seeing state governments investing in rail infrastructure and in carriages to carry grain. They have become lazy and they have walked away from their responsibility to put new infrastructure onto our rail tracks that would take the weight off our national road network. What will be the inevitable outcome of that? The freight task must be carried out. Who is going to pick up the load? The trucking industry will pick up the load.

Because of the monopolies that the state owned rail corporations have and the state governments’ failure to invest in grain trucks, we are going to see a situation, I predict, by the end of this year, where we as a nation are not going to be able to lift the grain from the farms and the receival points in regional and rural Australia and carry it through to the ports for export. I predict that, as a result of that, there will be markets lost because we are not able to meet those market demands and shipping regimes on time. We are dealing with an international market where competition is fierce and is growing all the time. And, of course, after seven long years of hard drought for those many grain producers out there, the last thing that they need is the impost of a new tax introduced by this government on their costs of doing business. And that is what this legislation will do: it will bring a new cost—a new tax, an increase in the cost of doing business—and I refer to the grains industry in this regard.

But we need not stop there. We can turn to the beef industry. The beef industry is Queensland’s second largest export earner by value. I just cannot understand the Premier of Queensland, Anna Bligh, or her transport minister even thinking of supporting this, because the two largest industries by value in Queensland in terms of exports in dollar terms are the coal industry and the beef industry. They are not located down in George Street or on the coast or in Brisbane; they are in the outback—in Mount Isa, in north-west Queensland; they are in the Bowen Basin; they are now in the Surat Basin. Of course, the beef industry is scattered throughout Queensland and, obviously, across Australia. This bill, if it passes both houses, will be a further impost on those industries. It is going to hit their bottom lines. And if you hit the bottom line of any business, business finds itself in a position where it has got to pass that cost on to the consumer. Once again, that is where the inflationary component comes into this bill—its imposts and the impact that it will inevitably have on the very productive beef and coal sectors of Queensland.

The other point I want to make with regard to this is that there is not a commitment from this government to use the additional tax revenue that will inevitably flow from this bill; there is not a commitment from the government to invest a dollar more in our road infrastructure—or, for that matter, our rail infrastructure. So this is just a tax grab on the productive sector that creates jobs for Australians. That is what this is: it is a tax grab—a new tax; a tax that has been stealthily brought forward without the people of Australia being advised prior to the last federal election.

I mentioned a few moments ago the importance of the beef industry. Some of the roads that I would like to see more money invested in are the Warrego Highway and the Landsborough Highway. They link Brisbane right through to Mount Isa. We desperately need an investment of $700 million where the Warrego Highway comes up through Toowoomba so that a second range crossing can be established just to the north of Toowoomba. This is a main arterial road from Brisbane through to Darwin, via Longreach and Mount Isa. This road carries the bulk of the road freight between the port of Brisbane and the port of Darwin and all the points in between. One particular section of the Warrego Highway, between Mitchell and Roma, is impacting as we speak on the beef industry and the freight industry from Darwin to Brisbane and from points in the south. Type 2 road trains—that is, three semitrailers are hooked up behind a prime mover and are about 60 metres to 70 metres long when they are on the road—can couple-up about 90 kilometres west of my home town of Roma and travel through to Darwin with freight or, vice versa, bring livestock back to Roma. Roma is the largest store cattle selling centre in Australia.

If we can get some investment from this government to upgrade that road so that it is safe for the type 2 road trains to travel the extra 90 kilometres to the largest store cattle selling centre in Australia, it will have the effect of reducing the cost of bringing cattle to the sale point of Roma. Roma sells something like 8,000 to 10,000 head of cattle per week. The cattle market in Roma is a bit like the Sydney stock exchange: it sets the prices and the trend of prices right across the eastern states. Cattle often come from Victoria to the markets in Roma. It is not uncommon to see cattle being trucked from Kununurra in Western Australia—a five- or six-day trip on type 2 road trains—to Roma. The cattle are spelled twice, but they are 80 kilometres short of their final destination at the saleyards of Roma. The driver has to decouple the last trailer and take the other two trailers through. They decouple the trailers on the flat outside of the town of Mitchell. No-one is there to supervise this. Either another truck is sent out to bring one of the trailers in or the truck comes in with one trailer, which is decoupled at the saleyards, and then it goes out without any trailers behind it to bring in the next trailer. It is the reverse when they want to go west, whether they are taking cattle, heavy machinery for the mining industry or goods from the eastern seaboard through to Darwin.

If the government is serious about the freight task that we confront in Australia and the bill passes through the House, we have to see the revenue from these measures not just as a money grab for Treasury but as money to be reinvested for the benefit of our road network in Australia, because it is the transport sector—the truckies and the truck owners—who are going to pay the price.

I mentioned earlier the impact that this legislation will have on working families. Whether trucks are carrying beef into the markets, soft goods—food items—into the supermarkets in the west, flour to the mills or animals for processing for human consumption, there is going to be an inevitable cost if this bill is passed in its entirety. The inevitable cost on working families will be an increase in the cost of their groceries at the supermarket. Why? Because the freight task—the cost of moving freight across Australia—will rise and that will be passed on to consumers. If it is not passed on to consumers, it will be passed back to the producer. Someone is going to pay. I assert tonight that it will be working families and the trucking sector, as well as the production sector in Australia, which will be impacted on by this legislation.

This legislation is a most appalling grab for money and the most deceitful performance that we have witnessed in modern times by any government in its first 100 days in office. One hundred days into this government and legislation is being introduced into this place that will bring new taxes into play. One of the worst aspects of this legislation is that the registration charge and the fuel tax charge that apply if this bill passes the parliament are going to be automatically indexed every year, and that linkage will be to the cost of building roads in Australia, which is far greater than the annual CPI. When the coalition were in government, we ended automatic indexation of fuel excise in this country, and now we are seeing it reintroduced by a Labor government, without it having told the people of Australia before 24 November. Members on this side of the House could speak on this issue for days and days. We are going to fight this legislation to the end. We are not going to give up.

(Quorum formed)

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

It is a great pleasure to rise to speak on the Interstate Road Transport Charge Amendment Bill 2008 in the House this evening and to voice the concerns that I have for the industry that I have been involved with over several years—over many, many years as a matter of fact. I have several concerns about the impact that this bill will have on transport operators within the Riverina and the additional costs that will flow on to the consumers. Consumers and businesspeople throughout my electorate are already doing it very tough. The ongoing drought and the additional charges will make it all the more harder for these people. Many of these people own trucks. Many of these people, who have been suffering from drought and who have not had a crop in seven years, will be affected by the increase in these charges as well, and I just feel that it is all very unfair.

We know that rural and regional areas are especially dependent upon transport services, and it is these areas that will most certainly feel the pinch as costs flow on to them. My electorate has a lot of heavy vehicle usage, especially with four major national highways running through the electorate: the Hume Highway, the Sturt Highway, the Olympic Highway and the Newell Highway. In September 2007 statistics showed that about 7,000 vehicles, and in particular about 4,500 heavy vehicles, travelled over the Sheehan Bridge at Gundagai on a daily basis. We are now seeing the duplication of the Sheehan Bridge. Finally, after many years of lobbying, we now have the duplication of that bridge taking place, which obviously will see those movements and the freight task being increased because the road, particularly a duplicated highway from Melbourne through to Sydney, will be able to take more of the freight task than it does now. Information that I have obtained about traffic from the RTA website shows general traffic movements through the other three Riverina highways, and most of these are of significant heavy vehicles. The Olympic Way had an annual average daily traffic of 3,040 vehicles just at a very small area in The Rock. The Sturt Highway at Collingullie had an annual average daily traffic of 2,782 heavy vehicles in 2006 and the Newell Highway at Narrandera had an annual average daily traffic of over 1,200 vehicles.

The tax rise for the trucking and bus industries will mean an extra 1.3c per litre on fuel from January 2009 and an increase in registration charges for 69 per cent of the nation’s heaviest vehicles. This means that registration fees will in some cases go up by 227 per cent. The issue that I have with that is the fact that we are rewarding inefficiencies. It is in fact the B-doubles and the B-triples and other heavier vehicles that will be slugged with this tax. But the heavy, fixed-rig vehicles that tear up the highways and cause the most damage at intersections, traffic lights and other areas due to having a fixed rig are not going to have this tax imposed on them. I think it is very short-sighted of the government not to question this through the National Transport Commission.

We have sincerely opposed these increased charges and taxes. The states have been trying to impose these additional costs and additional registration fees for a very long time. When we opposed this last time we were able to win because if the Commonwealth stands up and is counted, if the Commonwealth minister stands up and says no to these increases in charges then the states capitulate. They did last time and they will capitulate again, because they do not want to be the bearer of bad tidings. The states do not want to be blamed for the bad news, whereas now the states can just turn around immediately and blame the Commonwealth because ‘they forced us to do it’. This is an NTC issue. So, undoubtedly, the Commonwealth will get the blame for this. I am indebted to the previous minister for transport, former Minister Truss, who is now the Leader of the Nationals, for having the courage to stand up against the states and against the recommendations from the NTC to oppose this in the last parliament.

We found that, in addition to the increase in these costs and the 1.37c increase in the excise, the trucking industry has already borne the brunt of many increases. It has borne the load of heavy fuel prices for so long now. It has absorbed most of those; it has not passed them on to the consumer. It is an industry that is valuable to the Australian people. In fact, it is an industry that is integral to the operation every day of the Australian people. I feel it is short-sighted and neglectful and a non-recognition of the thousands and thousands of working owners, operators, drivers and their families, because these are the people who are most impacted upon by this legislation. It is the people who, Madam Deputy Speaker, you and I purport to represent on a daily basis along with both sides of this House. They are working Australian families. They are doing their best to deliver to us every day what we require in our supermarkets, in our whitegoods and in our retail outlets.

Imagine what it would be like—and I have raised the ire of some people by suggesting this—if all trucks were to stop at Gundagai for a day. Let us see just how well we would cope in Australia without the good men and women of the trucking industry. They are good people. They are solid Australians doing a job. It is a dangerous job. It is a job that is required and it is something that the Australian people sincerely cannot do without. However, instead of giving them recognition, we slug them. We capitulate and kowtow to the states’ call for ‘more money, more money, more money’. This is what it is all about. It is a revenue raising exercise by the state governments for which the Commonwealth will be blamed. Mark my words: the Commonwealth will wear this issue.

We have heard about the reviews and the studies that the government is doing currently and about one in particular, the ACCC inquiry to bring down the cost of groceries. Today we heard at the dispatch box from the government what the inquiry into the cost of food and groceries would reveal and how it was out there and operational—all because a government cares about the cost of living, of food and groceries, to the average daily consumer! I cannot understand how you would be concerned, on the one hand, about the rising cost of food and groceries and, on the other hand, allow the states and territories to dictate the terms and to push up those prices. There is no way that those prices cannot be pushed up by this decision. So how does one reconcile what is being done by the right hand with what is being done by the left hand under these circumstances? It is a very disappointing day to be speaking on this bill.

With these increases, even the Minister for Infrastructure, Transport, Regional Development and Local Government, Mr Albanese, has admitted that grocery prices are set to rise and they will impact on the family grocery budget by around 32c per week. But I say that it is not going to be 32c per week; it is probably going to be 32c per item, because eventually owner-operator transport drivers and trucking institutes will have to decide to bite the bullet and recoup the losses that they have been experiencing and absorbing over a long period of time. They are undergoing significant pressures.

Owners of transport companies in rural and regional Australia are unable to get skilled drivers and skilled workers. We have a skills shortage. Not only that; the states have imposed on them an enormous chain of command of occupational health and safety that is absolutely ridiculous. Everybody wants to ensure their workers are safe on the job, but what is being imposed upon New South Wales operators is an absolute disgrace. You have an industry that is already in crisis. It is an industry that does a magnificent job for the Australian people—which obviously is not recognised on the government side of the House, where there is a lack of desire to represent those fabulous trucking industry people who, each day of the week, make Australia operational. That we have this issue here this evening to debate and discuss, I guess, means that there is no longer recognition of what small businesses, particularly transport operators, are providing to the Australian people.

The Australian Trucking Association argued that the proposal for increased charges should be rejected completely. It also wanted to ensure that indexation did not increase the charges on the industry above what the industry should be paying. There has to be a clear understanding of what the industry is paying. I think there is a view out there that the Australian transport industry is not paying its way on highways and byways—and, in fact, that is incorrect. That has always been an incorrect assumption. Stuart St Clair, chairman of the ATA, is quoted in a media release of 5 February 2008, just after the most recent interest rate rise, as saying:

The Government has a five point plan to fight inflation and keep interest rates down, but it will be a while before it takes effect. By rejecting the NTC’s plan, the Government could take immediate action to keep some of the pressure off working families.

That is the truth. It would keep pressure off working families that happen to be owner-operators or people involved in the trucking industry.

Along with this imposition of costs and this slap in the face for the Australian trucking industry, I have another problem. Where the Transport Workers Union is in this, I have no idea. Where Tony Sheldon sits in amongst all of this, I have no idea. I for one believed that he was one man who really did seek to ensure that the rights of operators were paramount, particularly those of contract drivers. In fact, I have stood side by side with the TWU in support of the best interests of contractors and their drivers. I am aghast to think that nowhere have I seen anything that is said to be looking at supporting the very people that the TWU should be supporting.

I also have concerns about Labor’s plan to commit, between now and 2013, to only half the spending by the coalition government for road and rail. I am very pleased to see the member for Eden-Monaro in the House while I speak. The member for Eden-Monaro has been quoted in my local press as saying that the withdrawal of funding for Gocup Road was because there was no consultation with the states—that the Commonwealth just came in and put up $11 million. That is not true.

Mike Kelly (Eden-Monaro, Australian Labor Party, Parliamentary Secretary for Defence Support) Share this | Link to this | Hansard source

You’ve betrayed the bush.

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

The member for Eden-Monaro has been misled. There was consultation with the state government. The state government was actively aware of what was going on with Gocup and it actively supported it.

Mike Kelly (Eden-Monaro, Australian Labor Party, Parliamentary Secretary for Defence Support) Share this | Link to this | Hansard source

It was never going to happen.

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

Indeed, the state government guaranteed Visy Industries that, if the Commonwealth government would come on board and pay the money toward Gocup Road, it would most certainly come on board.

Mike Kelly (Eden-Monaro, Australian Labor Party, Parliamentary Secretary for Defence Support) Share this | Link to this | Hansard source

Dr Kelly interjecting

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

Madam Deputy Speaker, am I not entitled to speak without continual interjection?

Ms Anna Burke (Chisholm, Deputy-Speaker) Share this | Link to this | Hansard source

The member for Riverina has the call.

Kay Hull (Riverina, National Party) Share this | Link to this | Hansard source

Thank you very much. The fact is that we have had consultation with the state and the state is very well aware of this issue.

Debate interrupted.