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Tuesday, 30 April 1957

Mr BIRD (Batman) .- There is no need for me to expatiate in this House on the deplorable condition of Australia's roads. Suffice it to say that every parliament and local government authority in Australia agrees that our roads are disintegrating daily. At the present time, there are three sources of finance for road works. The Commonwealth contributes about two-thirds of the petrol tax to the States for this purpose. The State governments obtain funds from motor registration and drivers' licence-fees. Local governing bodies devote to road works revenues from rates and moneys from loans raised locally. I have found it impossible to obtain information about the amount provided by these authorities in the financial year 1955-56, but in the financial year 1954-55 the provision from these sources amounted to £84,000,000. This has been increased since, because the amount paid to the States from the proceeds of the petrol tax has been increased from £22,000,000 in the financial year 1954-55 to £32,000,000 for the current financial year. Although motor registration and drivers' licence-fees and municipal rates also have increased, it is safe to say that the total amount available for road construction and reconstruction works throughout Australia will not be more' than £100,000,000 a year.

At a recent meeting in Canberra, the" Australian Transport Advisory Council considered a report from the Committee of Transport Economic Research which had prepared a plan for the solution of Australia's road problems. The committeeconsidered that it would be necessary to spend £1,643,000,000 over ten years on Australia's roads. This represents a little more than £164,000,000 a year. It is quite obvious that the State governments and the local government authorities cannot, on their own initiative, raise sufficient money for this great task with the present allocation by the Commonwealth of £32,000,000 a year from the petrol tax. Sooner or later, a national roads planning authority will have to be constituted. I hoped that it would be done immediately, but on present indications it appears only in the vista of a distant future. Tn the meantime, the roads must be maintained and improved, and the States are being left to grapple with a problem that is completely beyond their financial capacity.

Recently, the Cabinet, with the idea of tickling the ears of the Australian people, appointed a Cabinet sub-committee to suggest ways of improving transport. Doubtless, the sub-committee will consider the prospects of improving Australia's roads system, but my experience of Cabinet subcommittees convinces me that expedition is not one of their virtues or attributes, and it is likely that considerable time will elapse before the sub-committee presents a report to the Parliament, much less prepares legislation for its consideration. In the meantime, the same old drift will continue, and our roads will be allowed to disintegrate daily - one could even say hourly. Therefore, the Opposition urges the Government to acknowledge the existing conditions, and its obligation to assist the States more than it does at the present time until a national roads planning scheme is inaugurated.

I suggest that the necessary financial assistance can be given by two methods. First, the Commonwealth could return the whole of the proceeds of the petrol tax to the States, and secondly, it could impose a tax on diesel fuel. I shall deal with the petrol tax first. In answer to a request by me for information, the Treasurer (Sir Arthur Fadden) has informed me that, by 30th June of this year, the Commonwealth will have collected £439,000,000 in petrol tax since 1926, and will have returned to the States £226,000,000. In other words, £213,000,000 of the total collections from (he petrol tax has been utilized for purposes other than road works. When Opposition members have raised this matter previously, the Government has attempted to justify its actions by stating, among other things, that the petrol tax was never intended to provide revenue only for road works. However, examination of the " Hansard " report of the debates on the Federal Aid Roads Bill 1926, and on the budget for 1926-27, shows such allegations to be entirely false. I could cite at least a dozen speeches to show that the petrol tax was originally intended only to provide funds which were to be paid to the States for road works, but it will be sufficient for me to refer only to the budget speech of the Treasurer of the time, the present right honorable member for Cowper (Sir Earle Page), made on 8th July, 1926, and recorded at page 3950 of volume 114 of " Hansard ". The right honorable gentleman said -

The State Governments, lacking the power to impose Customs duties, are unable to effectively reach all road users. The Commonwealth, therefore, is co-operating with the States in a national roads policy, and will impose special Customs duties which will be hypothecated for road construction. The imposition of these duties at the source will ultimately result in the road users paying this special tax proportionately to their use of the roads.

I think that the essence of the fairness of the petrol tax is to be found in that last sentence of the statement of the then Treasurer, which I repeat -

The imposition of these duties at the source will ultimately result in the road users paying this special tax proportionately to their use of the roads.

However, very shortly after the passage of that legislation in 1926, governments of al! political creeds - I am not indicting one government or another - increasingly used the petrol tax as a means of gaining revenue for general Commonwealth purposes. Doubtless, at various times, there were very good reasons for that. I can quite understand why, during the depression years, a government would use the money derived from the petrol tax for other purposes: I can understand why the money would be utilized otherwise in the war years; and doubtless there were good reasons in other periods. But at this critical stage of Australian road development, it is imperative for this Parliament to return to the basic theme of the original legislation, which was that all the proceeds should go back to the States. I am not suggesting that if all the proceeds were given to the States the road problem would be solved. Far from it! But it would considerably ease the burdens which the States are expected to shoulder now.

I know that it will be said by Government supporters that the Chifley Government gave only a certain proportion to the States and retained a large amount for itself. I agree that that is so. I have never disagreed with that contention. But surely this Parliament should change its point of view with the passage of the years. Conditions have changed and traffic problems to-day are immeasurably worse than they were during the regime of the Chifley Government. The incredible increase in road traffic in recent years, which has thrown terrific financial burdens on to the States, makes it essential for all of the revenue from the petrol tax to be paid to the States. As a matter of fact, we find that all governments have been keeping more or less the same amount, although I realize that the amounts paid to the States have varied. The Chifley Government, in its last year of office, retained £10,440,000. The amount retained each year remained at between £10,000,000 and £11,000,000 until 1953-54, when it increased to £13,300,000. However, the Commonwealth Government made a turn for the better in 1954, because it introduced new legislation to provide for more to be paid to the States, and in the next year the Government retained only £8,000,000. I thought that this was a step in the right direction and that the position would be improved progressively until ultimately the States got all of this revenue, but there was a return to the bad old practices. In 1955-56, £10,000,000 was retained by the Commonwealth Government, and in the present year it will retain £15,500,000. I find no fault with the contention that those who use the roads should pay for their maintenance, as the then Treasurer said when he introduced the legislation in 1926. Petrol tax is a legal pay-as-you-go tax, which has the effect of making those who use the roads most pay the most.

The second way in which the Opposition suggests that the Government could raise money for this purpose is by the imposition of a tax on diesel fuel. The Government's reluctance to impose such a tax is inexplicable. The matter has been under discussion for some years. It was raised by the South Australian Premier, Mr. Playford, as he then was at the Premiers Conference in 1951. Anybody who has observed the present traffic on the roads must agree that in recent years dieselpropelled vehicles have been increasing in numbers, also in size and weight. No honorable member will deny that great damage has been done to the road by huge diesel trucks. The Government should recognize the gross iniquity of taxing one set of motor users and not another, which is what is being done now. The Government, for reasons best known to itself, has refused to inform the House why it has failed to impose a tax on diesel fuel. I have repeatedly asked questions of the Prime Minister (Mr. Menzies) on this matter, and have been told that it has been under consideration. The matter has been under consideration by this Government for at least three years. Rumour has it that recently, when the Australian Automobile Association approached the Prime Minister on the matter, he said that revenue of £4,500,000 was insignificant in relation to the total amount required for Australian roads. In other words, he said that it was not worth collecting. I can inform the Prime Minister that, in view of the present parlous financial position of the States, that amount would appear to them to be of great magnitude and could be used most advantageously by them.

I suggest to the House that the Government's refusal to impose a tax on diesel fuel is an anomaly that must be removed immediately. It has been stated by responsible authorities that the destruction of the Hume Highway has been caused by huge diesel vehicles, not by petrol-driven vehicles. This Government has refused to impose such a tax, but what has been done in other countries? Great Britain, for example, has imposed on diesel fuel a tax which is identical with the tax imposed on petrol. To-day, the price of diesel fuel in Great Britain is 92 per cent, of the price of petrol, because tax is paid on both fuels. But in Australia the price of diesel fuel is only 60 per cent, of the price of petrol, because the Government will not face up to the position and do the fair thing to the State governments and that section of the motoring public which uses petrol. In the United States of America, a tax on diesel fuel was imposed in 1942. In that country, both the Federal and the State governments impose such a tax. In six American States the tax on diesel fuel is higher than the petrol tax. So it can be seen that other countries have overcome the difficulty. The Government may say that there are many persons who use diesel fuel other than on the roads and that it would be unfair to impose a tax on them. Other countries have solved this problem by providing for refunds where diesel fuel is used for other purposes. If the Government cannot think of an idea itself, it should get in touch with the governments in America, Britain and New Zealand, and find out how this problem can be overcome.

I am aware that at present vehicles using diesel fuel pay double registration fees, but that does not nearly compensate for the vast amount of damage which they do to the roads system. I suggest that a tax on diesel fuel is a valid source of income that merits the attention of the Government. I hope that the Government, in fairness to the States and that section of the motoring community which uses petrol, will soon introduce such a tax as a source of revenue. The Australian Labour party contends that the Government should make available to the States another £20,000,000 for roads purposes. It is idle to suggest that there is no work to be done and that the various State roads authorities cannot do the job. The Victorian Country Roads Board could, without any trouble whatsoever, utilize another £10,000,000 a year. If another £20,000,000 were made available to the States under the present formula, the Victorian Government would get only about £4,000,000.

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