House debates

Thursday, 23 October 2008

Road Charges Legislation Repeal and Amendment Bill 2008

Consideration in Detail

Bill—by leave—taken as a whole.

11:17 am

Photo of Warren TrussWarren Truss (Wide Bay, National Party, Leader of the Nationals) Share this | | Hansard source

by leave—I move amendments (1) to (5):

(1)    Schedule 3, item 4, page 5 (lines 15 to 25), omit the item, substitute:

4  At the end of section 43-10


Meaning of road user charge

        (7)    The road user charge for taxable fuel means:

             (a)    if no rate has been determined by the *Transport Minister under section 43-15—21 cents for each litre of the fuel;

             (b)    otherwise—the rate determined by the Transport Minister under section 43-15.

(2)    Schedule 3, after item 4, page 5 (after line 25), insert:

4A  After section 43.10


43-15  Determining the road user charge

        (1)    The *Transport Minister may determine, by legislative instrument, the *road user charge.

        (2)    In determining the *road user charge, the *Transport Minister must not apply a method for indexing the charge.

        (3)    The *road user charge must be based on the figure (the net figure) that is the difference between:

             (a)    the amount of government expenditure on construction and maintenance of public roads that is allocated to heavy vehicles; and

             (b)    the amount of government revenue raised through registration of heavy vehicles and other charges imposed as a direct result of heavy vehicle use.

Note:   ‘Government revenue’, ‘government expenditure’ and ‘heavy vehicle’ are defined in subsection (8).

        (4)    The rate of the *road user charge must not be increased unless:

             (a)    the net figure has increased since the date the existing road user charge became effective; and

             (b)    an average of at least 50 additional heavy vehicle rest areas have been constructed each year on the National Land Transport Network, as defined in the AusLink (National Land Transport) Act 2005, since the date the existing road user charge became effective; and

             (c)    the type of rest areas constructed, their spacing and amenities are consistent with the goal that rest areas in the National Land Transport Network will comply by 2019 with the recommendations in the National Guidelines for the Provision of Rest Area Facilities Final Report, Revised November 2005, prepared by the National Transport Commission; and

             (d)    substantial harmonisation has been achieved in State and Territory transport regulations, including heavy vehicle fatigue reform measures; and

             (e)    Infrastructure Australia, the body established by the Infrastructure Australia Act 2008, has advised the *Transport Minister in writing that:

                   (i)    the matters referred to in paragraphs (b), (c) and (d) have occurred, or will have occurred, at the date the proposed increase in the road user charge is to become effective; and

                  (ii)    the construction of heavy vehicle rest areas makes reasonably adequate provision for current and future use by high-productivity vehicles.

Note:   Infrastructure Australia’s functions include functions conferred by laws other than its enabling Act―see paragraph 5(2)(k).

              (f)    the Transport Minister has released publicly, at least 60 days before making a determination under this section (the public consultation period), the net figure mentioned in subsection (3), all the expenditure figures and revenue estimates, statistics, formulas, methods, models, and inputs used to calculate the net figure and the proposed rate of the road user charge, the advice of Infrastructure Australia referred to in paragraph (d) and a statement explaining the reasons for the proposed rate increase; and

             (g)    the Transport Minister has had regard to submissions received within the public consultation period.

        (5)    The arterial road and other expenditure figures provided by the Commonwealth, States and Territories and released in accordance with paragraph (4)(f) must contain a statement of verification by the auditor-general in the jurisdiction to which the figures relate.

        (6)    The *Transport Minister must not make more than one determination in a financial year if the effect of the determination would be to increase the *road user charge more than once in that financial year.

        (7)    A determination made under this section must not take effect earlier than the first day after the end of the period in which the determination may be disallowed under Part 5 of the Legislative Instruments Act 2003.

        (8)    In this section:

government expenditure means the amounts of expenditure by the Commonwealth, States, Territories and local governments for a financial year calculated in real terms as averages over a seven-year period using the latest:

             (a)    available arterial road expenditure figures provided by each of the States and Territories; and

             (b)    local road expenditure information based on Australian Bureau of Statistics figures.

government revenue means the total of the amount of revenue expected to be raised by each of the Commonwealth, States, Territories and local governments in the financial year immediately following the date the determination made under this section is to commence.

heavy vehicle means a vehicle with a gross vehicle mass of more than 4.5 tonnes.

(3)    Schedule 3, page 5 (line 29) and page 6 (line 1), omit item 6.

(4)    Schedule 3, page 6 (lines 2 to 3), omit item 7.

(5)    Schedule 3, page 6 (lines 4 to 8), omit item 8.

The amendments moved by the opposition will address four issues of concern to us regarding the charge-setting regime on the heavy vehicle industry. The first is indexation of charges, the second is fair charge setting, the third is heavy vehicle rest areas and the four responds to the absurdity and contradiction of state based transport regulations. The Minister for Infrastructure, Transport, Regional Development and Local Government in his reply to the second reading debate has pre-empted these amendments by responding in advance, but let me put the case for them. The coalition’s approach to fuel excise indexation is well known. We oppose indexation of taxes. In 2001 the coalition government abolished Paul Keating’s fuel excise indexation in order to protect Australians from a tax grab by stealth that occurred every year. When we last discussed the road user charge in this place last March, the government proposed to index the road user charge. This charge was to be indexed on a formula based on road construction and maintenance costs and the use of the road system by heavy vehicles. Since road construction costs have risen so dramatically in recent years and the formula used by the National Transport Commission in its 2007 heavy vehicle charges determination has removed the CPI cap, the index will probably lift by at least seven per cent a year. This is a very big slug on Australia’s hardworking truckies, and it would not have been based on any current assessment of what level of change had applied and was justifiable.

The government says that future road user charges can be set by regulation and that the regulations may include a method of indexation. That is what is included in the bill, and I acknowledge that the government has made that concession. The wording of the bill, though, which amends section 43-10 of the Fuel Tax Act 2006 to permit the making of a separate regulation, when defining that regulation, states in clause 4(8):

The regulations may prescribe a method for indexing the road user charge.

This is our problem: the option of a road user charge by indexation is still included in the legislation. This means the government may make a regulation that contains an indexing formula that defines subsequent increases in the road user charge. What follows is that the government need not make such a regulation again. Should parliament pass such a regulation, the road user charge would go up every year without the opportunity for parliament to debate or disallow such an increase and potentially also without the need for regular checks on its validity. Our amendments address this concern. Under our proposal the government would need to issue a legislative instrument every time to change the road user charge. To make this perfectly clear, our amendments incorporate a new subsection into the Fuel Tax Act, which reads:

In determining the road user charge, the Transport Minister must not apply a method for indexing the charge.

If the government wants to increase the charge, it needs the permission of parliament. To us that seems fair and proper. A fair charge cannot be based on an automatic formula. It should be a broad calculation of the amount spent on roads to meet the requirements of the trucking industry less the amount raised from the registration fees.

The second element of our amendments is the requirement that the road user charge be set fairly. The road user charge is designed to recover the cost imposed upon Australia’s road system by the heavy vehicle industry. It is only reasonable that the sector that is being charged for such costs be consulted and its views considered. Unfortunately, the National Transport Commission did not adequately meet these requirements when it developed its recommendations. For example, the commission refused to provide the trucking industry with the model it used to determine its charges. Some of the raw data from the states and territories that went into the model was also not made available.

The commission conducted a major stakeholder meeting in May 2007, where it called for votes on particular aspects of its charging model. Unfortunately, most of the stakeholders at the meeting represented the state and territory governments, not the trucking industry. In effect, the meeting was stacked by those who would benefit from the charge going up. When the commission developed the charges, it included in its assumptions that many trucks illegally carry high loads. This is in spite of the fact that it has already imposed $65 million of enforcement costs on the industry in its calculations of the financial impact on the trucking industry. (Extension of time granted) Essentially, the commission has double-billed the industry for this illegal activity.

Obviously, no industry likes charges. That makes it all the more important that such charges be determined by an open and honest process. Our amendments do so by setting out the standards under which the charges must be developed. These standards will require the government to release all of the estimates, statistics, formulas, methods and inputs used to calculate the road user charge rate and will oblige the government of the day to explain the reasons for any proposed rate increase. They require public consultations for 60 days on proposed rate increases and direct the minister to have regard to the submissions received during the public consultation period. The opposition acknowledges that these are strict conditions but makes no apologies for that. An increase in a charge upon an industry already doing it tough deserves openness and transparency.

I turn to the provision of rest areas. The third objective of the opposition’s amendments is to link the possibility of any future increases in the road user charge to the construction of more rest areas on the AusLink national network. The minister has said repeatedly in the debates on this issue that the government’s announced $70 million Heavy Vehicle Safety and Productivity Package is dependent on the passage of this legislation to introduce higher charges on the industry, but where are the guarantees that the money will actually be delivered to the promised rest areas? The minister suggested that the previous government had no interest in the provision of rest areas but, in reality, we were building rest areas every year. A significant number of rest areas were constructed using Commonwealth funding, and the amendments to the legislation merely clarified the powers. It did not start the process; it had already been occurring.

Members may have noticed that there are more trucks parked on the side of our highways than ever before. That is because Queensland, New South Wales, Victoria and South Australia introduced new fatigue laws on 29 September. These laws reduced the number of hours that truck drivers can work before they are required to take a break. The problem is that there are not enough rest areas where truck drivers can stop. It is a problem that will get worse as the number of trucks on the highway also increases. After undertaking a study of the state of Australia’s roadside rest facilities, the National Transport Commission, in November 2005, issued its guidelines for the provision of rest area facilities. This report sets out where rest areas should be built in order to comply with the various road agency guidelines and to cater for the needs of heavy vehicle drivers. This is the answer to the minister’s questions about what sort of rest areas should be built and where the standards should be developed. That has already been done; it was agreed in November 2005.

A major rest area, according to those standards, should be provided every 100 kilometres, with sufficient parking for at least 20 trucks; a minor rest area, every 50 kilometres, with parking for up to 10 trucks; and a truck parking bay, every 30 kilometres, with enough space for four or five trucks so the drivers can do their safety checks. Further, an independent government research agency, Austroads, recently audited Australia’s major highways against those guidelines. Their report, released in March this year, showed that none of the audited routes met the national guidelines and that 60 per cent of the audited routes had substantial deficiencies. There were particular problems in Queensland and the Northern Territory. A list of the highways which had particular deficiencies was identified but I will not take the time of the House to go through it in full. Only about half of the major rest areas on the Hume and Pacific highways in New South Wales met the specific requirements for the guidelines. Obviously, the lack of heavy vehicle rest areas is a safety issue. We should not have truck drivers pressing on down the highway when they are fatigued or out of hours because the rest area where they planned to stop is full and there is no alternative. In addition, the recent heavy vehicle driver laws will only increase pressure on these heavy vehicle rest areas. The law now requires them to stop, but, if there are no rest areas available, that is going to be very difficult.

I also note that, in the Senate estimates hearings of the Department of Infrastructure, Transport, Regional Development and Local Government, the deputy secretary, Mr Wilson, admitted that the $70 million package would not solve the problem on its own. So there does need to be a considerable investment of expenditure on these sorts of issues. (Extension of time granted) In fact, according to the trucking industry, there needs to be another 900 rest areas on the 22,500 kilometres of the AusLink national network to bring it into line with the national rest area guidelines. This estimate is based on duplicating the rest areas on both sides of the roads so that trucks never have to turn across oncoming traffic to get into a rest area. But the opposition has been informed that constructing 500 additional rest areas would bring the network broadly into compliance with staggered rest areas on the left and right sides of our highways. That is why we chose the number of 50 rather than the larger figure that was identified in the audit.

This amendment would permit the government to increase the road user charge again only if, amongst other things, it had built an average of 50 rest areas on the AusLink National Network each year since the last increase in the charge. That will deliver 500 rest areas over 10 years. The amendment also requires that Infrastructure Australia audit progress and advise that the rest areas are consistent with the goal of having the national network compliant with the national guidelines by 2019.

We estimate that the total cost of building these rest areas would be about $300 million over the 10 years. Some of the rest areas would cost millions of dollars, particularly on major freight routes in urban areas, but most of them would cost just a couple of hundred thousand dollars. It is a small amount compared to the revenue that the government will raise from the road user charge over the next 10 years. The government has estimated that the measure in the bill will raise $490 million over four years, starting at $40 million this year but rising to $190 million in 2011-12. Using Treasury’s figures and extrapolating from 2011-12 at a growth of seven per cent per year, the revenue raised works out at over $2.5 billion. The measures that we have introduced would reduce that figure, because the government will have to justify increases in the charge rather than watching it ratchet up every year. But the increases in the road user charge could still be expected to generate significant extra revenue.

The opposition regards the lack of rest areas as a key issue facing drivers of heavy vehicles. It is a safety matter and quite clearly someone has to stand up for the ordinary truck drivers who work long hours on our highways. Our amendments would give them a guarantee that something is going to be done about providing the facilities they need. We also call upon the government to stop the tactic of threatening the future of this program on the basis of the passage of the bills. We think it is important to get on with safety measures to improve our roads, and that should happen irrespective of whether this bill is passed.

Finally, I want to address the amendments which deal with the ridiculous situation in Australia regarding contradictory stated based transport regulations, and the minister is right when he says that this is an ongoing issue that neither his party nor our parties were able to resolve in previous terms in government. But we do need to make more headway. I acknowledge that this measure puts pressure on the federal government rather than the state governments. But I recall the promises made by the Rudd government regarding its capacity to work constructively with the state governments. There was a lot of talk about how there was going to be cooperative federalism. If there is that element of cooperative federalism, it is important that we actually see some delivery of results. Instead of just pious, well-meaning declarations from COAG, we want to see things happen. That is why we have included in our amendment the insertion of sections 43-15(4)(d) and (e). These clauses stipulate that the government may only raise the road user charge if substantial harmonisation has been achieved in state and territory transport regulations, including heavy vehicle fatigue reform measures, and if Infrastructure Australia is satisfied with that.

We have all agreed that the issue of state based transport regulations is an enormous problem and that it is costing the industry millions of dollars, and undoubtedly putting extra pressure on the industry. If we want to charge the freight sector more, the government must make genuine progress in fixing this issue. The opposition acknowledge that the government has made improvements and that this legislation is better than the legislation that preceded it, but we think that the legislation needs more work and that our amendments will improve it. It will satisfy the industry that they are getting a fair deal for the money that they are paying and encourage a constructive attitude towards achieving uniformity and progress in national regulations.

11:33 am

Photo of Anthony AlbaneseAnthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | | Hansard source

I thank the shadow minister, the member for Wide Bay, for outlining again some of the reasoning behind the amendments that he has moved to the Road Charges Legislation Repeal and Amendment Bill 2008. I want to point to why the government specifically opposes these amendments, and I will work in reverse order from the way that the shadow minister put them. The problem with clause 4(d) is that the road user charge does not impact on state funding; all it does is impact on Commonwealth funding, so it does not actually provide any pressure whatsoever on state governments to move towards the adoption of uniform laws. Already there has been substantial progress made between the Commonwealth and the state and territory governments through the Australian Transport Council towards that objective. That is why we will be meeting in Adelaide for the fourth time since February: to make sure that that agenda is progressed. But it is no good putting up amendments that are meant to achieve an objective that simply cannot be achieved, and that is the problem with that amendment.

The problem with the amendment about Infrastructure Australia auditing the construction of heavy vehicle rest stops is that it confuses completely the role of Infrastructure Australia. That is not its role. It does not have people out there auditing whether rest stops have been built or not. The idea that Sir Rod Eddington, as the Chair of Infrastructure Australia, is going to be going around counting the number of rest stops and conducting an audit is an extraordinary distraction from what the job of Infrastructure Australia is.

Rest stops are important. That is why this government has put them on the agenda. The inadequate number of rest stops for heavy vehicles is not something that has been created since 24 November 2007. It has not just arisen. In relation to the appropriate number of rest stops, the guidelines have not been adopted by the Australian Transport Council. They were never adopted under the previous government. They have not been adopted yet. This government agree that there is a need to address the issue of rest stops. That is what we have done. That is why we have said that $70 million over the forward estimates will be available for taking action on rest stops. It is of course expected that that would produce much more than $70 million worth of outcomes, because there would be negotiations and discussions with state and territory governments about that issue.

I think the clauses that have been suggested and put forward by the opposition do not achieve the objective that the shadow minister has outlined. And there is the extraordinary proposition that many of these measures were not undertaken when the shadow minister was the actual minister two years ago—not undertaken by him, his predecessor or his successor. So it is a bit rich, frankly, to hear the position that has been outlined by the shadow minister.

With regard to the calculation of costs to be recovered and the suggestion about road user charge future indexation (Extension of time granted) the fact is that the proposition advanced in this legislation does not conclude the discussion about what the regulations should contain for the future. That would be subject to parliamentary scrutiny. So I say to the shadow minister, in good faith: this does not conclude that debate. This parliament would have to consider the nature and detail of the regulation. As the minister, and as any minister would be, I am certainly committed to ensuring there is proper consultation with industry about the nature of that regulation.

So let us not have this used as an excuse to oppose this legislation, because it should not be. Essentially, I say to the shadow minister: that is a debate which is not concluded by the carriage of this legislation. All that is concluded by the carriage of this legislation is the process of increasing the road user charge in accordance with the determination begun by the former government and a political commitment arising from that, which was not there from the former government, to allocate $70 million for the safety and productivity package. I do not argue that $70 million will satisfy over the long term all of the needs of the industry for heavy vehicle rest stops. I do not argue that. I argue that this is $70 million specifically on top of the process that currently exists and existed under the former government, whereby rest stops were built into some of the AusLink funding and road funding agreements between the Commonwealth and the states. This is additional funding specifically for that purpose, and it should be supported by the opposition. I commend the bill to the House. I encourage the opposition to engage in constructive discussion to ensure that this bill is carried by both houses of parliament.

11:41 am

Photo of Warren TrussWarren Truss (Wide Bay, National Party, Leader of the Nationals) Share this | | Hansard source

I would like to respond briefly to some of the minister’s comments. Firstly, I acknowledge that Infrastructure Australia has a range of functions, but amongst its specific objectives is the auditing of infrastructure. So it will in fact be auditing roads, rail, ports and all sorts of other things that come under the definition of infrastructure. If in fact it is necessary for Sir Rod to count the number of potholes—which I am sure he will not actually be physically doing—then it ought to be equally necessary for him to count the number of rest stops. In reality, in practice, what will happen is that he will receive advice, he will check that advice and Infrastructure Australia, by in fact auditing the program in relation to roadside rest areas, will just carry out the same kinds of functions that it is doing and which are a clear part of its charter.

I would also argue that a national network of roads stops is in fact an important piece of national infrastructure. Clearly, therefore, it sits squarely within the charter of Infrastructure Australia to make sure that our nation’s infrastructure is relevant and appropriate to our needs. I think it is the kind of thing that Infrastructure Australia was designed to do and therefore it is an appropriate body to undertake this kind of audit. If that is the only sticking point in the amendments, I am sure we can talk about it, but it does seem to me as though Infrastructure Australia is a body well placed to undertake an audit of that nature.

The question of providing rest areas—how many have been provided in the past and how many will need to be provided in the future—is of course greatly affected by the fact that we now have, in several states and shortly in all states but one, a new fatigue management system which requires trucks to stop more often and which makes it an offence in some states to go past a truck stop, even if it is full. So the provision of rest areas has become more urgent because of the introduction of the fatigue management system. Indeed, as I have said a couple of times in this debate, I think there is actually something a bit odd in the chronology when we pass the laws first and then build the necessary rest areas afterwards. It is pretty unreasonable to ask a truckie to stop at a rest area that does not exist. The Commonwealth and the states have an obligation to do much better in that area.

The next comment I would like to make is in relation to the minister’s views that this does not put pressure on the states because all the money, from both the registrations bill, which we have passed, and this one, ultimately goes to the states. I acknowledge that, but it does place some pressure on the COAG process, and particularly on the federal government to deliver on its promise that it would be able to negotiate—and deliver results—with the states. So it is appropriate that there be pressure placed on the federal government to deliver in this regard. I do not have the capacity in the parliament to move amendments that would impose requirements on the states. If I could I would, in this regard. I can only advocate measures that affect the federal parliament and the federal government, and that is what I am doing.

The minister is also correct to say that the legislation does not end the debate. There will still have to be regulations coming into the House to set future registration fees and the road user charge. I acknowledge that that process is still ahead of us but this bill sets the parameters for those regulations, and it is not possible for us to allow the passage of a bill that includes parameters that we find objectionable—including the provision that indexation of the excise would be one of the things that could be considered in the regulations. That is the reason we are seeking to amend the bill to take that provision out and to insert a range of other provisions about the way in which the negotiations and the setting of the charge would be undertaken.

11:46 am

Photo of Anthony AlbaneseAnthony Albanese (Grayndler, Australian Labor Party, Leader of the House) Share this | | Hansard source

I will address the two issues of a substantive nature that the shadow minister, the member for Wide Bay, just raised. On the issue of Infrastructure Australia, he raised an analogy with the consideration of other roads. Can I say that Infrastructure Australia will also not be doing audits of traffic lights and where they are required or audits of roundabouts and other safety provisions. That is not to say that they are not important. They are important, just as rest stops are important, but it is absolutely critical that Infrastructure Australia not be distracted from its work on nationally significant infrastructure. I have gone out of my way to make this clear. I am sure, for example, that an audit of Infrastructure Australia would show that they have received, amongst the hundreds of submissions, issues that should, quite rightly, be considered by local governments, state governments, my department or other departments, but which are not considered to be nationally significant infrastructure.

That is understandable, given that the Infrastructure Australia process is new and that the legislation to create Infrastructure Australia was introduced and carried just this year. I sincerely hope that over a period of time both sides of parliament agree that the Infrastructure Australia agenda, as a foundation for nation-building infrastructure, is critical, and on that basis that Infrastructure Australia should not be distracted by other issues and tasks which, whilst important, are more appropriately dealt with by other bodies. Infrastructure Australia will deal with the demand that there has been, particularly from the private sector and the business community, for the coordination of nationally significant infrastructure. So I say to the shadow minister that that is not appropriate in the amendments that have been moved.

The second issue is the regulation that is provided for in this legislation. The problem I have with the shadow minister’s approach is that he says that it is foreshadowed that the regulation will be available to the government for introduction because of this legislation. Of course, as a former transport minister he would know that that could be done separately in terms of a regulation. It could be put forward, in the normal process of policy and legislative development, at another time. But it is also the case, I think, that the shadow minister is suggesting that somehow, in carrying the legislation as it has been framed with the reference to a regulation, that is the conclusion of the debate. I say to him that it is not. If his problem is with the word ‘indexation’ appearing then perhaps that is something that could be adjusted in another place.

Because this does not conclude the debate on what will be in the regulation and what will not, it does not really matter all that much, in substance and in outcome, what the precise wording of that particular section of the bill is—because the regulation will be subject to parliamentary scrutiny at a future time. So I respectfully inform the shadow minister again that we will be voting against these amendments but that our non-support for the amendments should not be an excuse to oppose the legislation, which does nothing more and nothing less than ensure that heavy vehicles pay their way—a position that both sides of this parliament say they support, and which the heavy vehicle industry itself says it supports.

Question put:

That the amendments (Mr Truss’s) be agreed to.

Question put:

The the bill be agreed to.

Bill agreed to.