Life is about to get a lot more expensive and our industry is in the Government’s sights for collecting cash.
While we were pleased to see Transport Minister Michael Wood come out this week and confirm the Government’s promise of three months’ worth of road user charges (RUC) relief, we still have no detail on how that will work between “late April and late July 2022”. Transporting New Zealand has pushed for clarity since the Government announcement last week (14 March) that there would be three months’ relief on petrol and diesel prices.
While it is something good, it feels a bit like giving with one hand and taking back with the other. On Monday this week, Waka Kotahi outlined its planned changes to fees and charges.
Waka Kotahi believes private motorists have been paying more than they should and those costs need to shift to the commercial sector to bolster Waka Kotahi’s underfunded regulatory arm, which is currently subsidised by government loans.
While we appreciate the funding structure needs to be reviewed, we want to see the analysis and evidence that the trucking industry hasn’t been paying its way.
Those of us who live in Wellington have watched the bureaucracy balloon in recent years. For some of the regulatory functions we would expect to see less people and more automation, which should cost less.
What we don’t want to see is the commercial sector funding additional regulatory costs that aren’t improving safety and that aren’t ensuring that the sector is performing better in terms of regulatory compliance.
In fact, we believe there is ample opportunity for the sector to partner with Waka Kotahi on a co-operative compliance system. We have proposed this by industry, for industry, with good regulatory oversight approach. We believe this has many benefits by giving industry some responsibility to develop good practice guidelines to assist all operators to comply with the law. Sadly, this is too hard for bureaucrats to get their heads around and thus far, we have found our suggestions blocked at every corner. Instead they offer us a review that will see the sector pay them more, and possibly not see any reductions in accidents and injuries in and around vehicles.
On behalf of the industry, Transporting New Zealand will be submitting on Waka Kotahi’s eight proposals on its regulatory funding and fees consultation.
While some relief over RUCs for three months will help businesses, we all have to be mindful of what happens at the end of that three months. We need to be thinking more about the next three years, as it seems inflation is here to stay and for many operators, business is going to get tougher over the medium term.
The Government is also undertaking a review of RUCs, with a big shift to using these funds to recover more than the costs of building, maintaining and operating roads.
Instead of relying on the Emissions Trading Scheme (ETS) to meet our climate change obligations, there is creep into all Government policy to ensure funding for a low emissions future. It is going to cost big dollars and they have to come from somewhere. Even the most middle class households will only tolerate so much cost.
One of the fundamental changes being considered is how RUC might be used to charge for greenhouse gas emissions and other factors beyond damage to the roads (like noise pollution and congestion).
The consultation document is 78 pages and poses 89 questions including things like how electric vehicles might be charged for the roads they use when the EV RUC exemption ends in March 2024, how RUC’s compliance regime can be improved, and whether or not electronic RUC for heavy vehicles should be mandated.
Submitting on the RUC review (closes 22 April) is a big piece of work for us. The resulting decisions have the potential to not only increase costs for operators, but to make some fundamental changes to policy intent that we will question vociferously where we need to.
All road users should pay for the road they use, there is a clear benefit in that. But externalities should not be added to a simple user pays system.
Trucks and the commercial choices they symbolise have always been a clear target for this Government.
It is important that at this time our industry keeps the public goodwill and support that has been fostered through the Covid-19 years. We have delivered and people have seen that.
As costs creep up and we cop the price of whatever the Government wants to throw at us, we can’t let health and safety be compromised.
Costs have to be passed on so that businesses can operate well and within the law. The Government is just going to have to wear that as it works out how to sell to the households of New Zealand that they are going to have to pay through the nose for the Government’s policies.
- Nick Leggett, CEO, Ia Ara Aotearoa Transporting New Zealand