Roads Australia
Australia’s peak body of road industry stakeholders has called for a major shake-up of road and transport infrastructure funding, ahead of the long awaited release of the Henry tax review.
Roads Australia (RA) says the current debate on road pricing needs to go beyond single issues like fuel excise and congestion taxes to fixing the whole 'dog’s breakfast'.
“The taxation review by Dr Ken Henry opens the way for a ‘new deal’ on the way Australia’s transport infrastructure is funded, managed and priced. It presents an historic opportunity for generational change,” says RA President, Ray Fisher.
“The cost structures for all transport users - including motorists, freight and public transport - are an accident of history.
“Our roads are used as a mechanism for general taxation. More than 80% of the fuel tax collected goes elsewhere.
“And, in the case of roads, the overlapping responsibilities of state and federal governments do not help.”
Notwithstanding the weakness of the current set-up, Mr Fisher says, there is considerable investment in improving planning, investment and delivery practices.
“The current Federal Government has done well to develop improved planning and consultative mechanisms like Infrastructure Australia within our impossible inherited system. We also welcome state initiatives like the Victorian Parliament’s Inquiry into Federal-State road funding,” he says.
“But we now need to take the next step.
“The people who manage our roads should also manage the revenue collection – and be accountable publicly for it.
“We are not talking about a new tax. In fact we don’t need one. We need new pricing systems that are fair to all road users, and meet the needs of users of public transport and other road users, including freight and cyclists.
“Road industry stakeholders would welcome a review of fuel tax but it should be the catalyst for a review of the entire process embracing federal, state and local government.
“Road pricing is only half the story - the critical debate we need to have is on road funding.”
Mr Fisher says the current system of road funding is irrational with little to recommend it.
"It's unreasonable, unjust and fails to take account of new demands, especially in terms of the environment," he says.
“Planning and funding must go hand-in-hand and be divorced from the tri-annual cycle of parliamentary elections, annual budgets and even shorter-term closed-door planning.
"The Commonwealth's recent initiative in establishing national planning criteria for transport, housing, urban development and sustainability is a step in the right direction to meet the challenges ahead.
"We hope Australian policy-makers will now move towards redefining the overlapping responsibilities of the Commonwealth, the states and local government for land transport policy-making, planning, construction, pricing, operation and maintenance.
“Much of the need for change in our transport system is now driven by environmental considerations. A new management regime will also provide the opportunity to accommodate the priorities of the environment in our transport system."
Mr Fisher says the Commonwealth-administered fuel excise has proved to be a great revenue-raiser for almost everything except roads.
“It is a poor consumption tax as most users have no alternative and so fuel usage is not suppressed. It is also a tax that has no links with either transport or land use policy and its effects may be counter to such policies.
“And as we move towards more fuel efficient vehicles, fuel excise will cease to be an effective source of revenue for governments.”
Roads Australia has commissioned one of Australia’s most eminent road engineers, Dr Max Lay, to write a major report on the need for change and to consider possible solutions. The report will be published early in the new year and will call for policy collaboration between the community, industry and government in a comprehensive review.
“Australians are overdue for a new deal in transport. They will not be fobbed off with a substitute for the fuel tax,” Mr Fisher says.
Submitted by Mark Bowmer on Thursday December 10th 2009 6:58pm