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Tuesday, 18 March 2008
Page: 2114


Ms MARINO (6:33 PM) —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.