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April 2015
TRN UPDATE
News and views from Australia and overseas on the transport funding reform debate
Shortcuts
Jakarta is moving closer to a
Singapore-style electronic
road pricing (ERP) scheme.
Governor Basuki “Ahok”
Tjahaja Purnama reportedly
wants a pilot up and running
before the end of this year.
!
A new report prepared for the
Bus Industry Confederation
(BIC), Connecting
Neighbourhoods: The 20
Minute City, says governments
need to shift the focus on
transport-oriented planning to
the outer suburbs.
!
The TRN will be making a
submission on the final report
on Australia’s competition
policy www.competitionpolicyreview.
gov.au - released by the
Federal Government in March.
Recommendation 3 of the
Report has called for the
introduction of cost-reflective
direct road pricing, subject to
the commensurate reduction
in indirect charges and taxes
on road users.
Transurban to conduct
road pricing study in
Melbourne
Toll road operator Transurban is taking the bull by
the horns in the road usage charging (RUC) debate,
announcing its own study to explore options for a
more sustainable road funding model for Australia.
Unveiling the initiative last month,
Transurban CEO, Scott Charlton
(pictured), said the Road Network
Pricing Study would be conducted in
Melbourne across the whole road
network, using volunteers from
Transurban’s customer base.#
The exercise will trial various user-pays models including:#
• a distance-based per-kilometre charge;#
• an annual fixed costs per kilometre based on expected usage,
and;#
• a price per trip or charge to access the road network.#
The study will also explore other models being employed
throughout the world, including time-of-day pricing on the
network and a charge for entering the CBD. Transurban will
compare the impact of these models on existing funding
sources of fuel excise and registration and gauge drivers’
preferences to the schemes.#
Cont. page 4
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April 2015
RUC in New Zealand: how it works
When it comes to road usage charging, our cousins across the
ditch are well ahead of the game compared to us here in
Australia.
New Zealand has had an RUC scheme in
operation since 1978. It’s applied to
vehicles over 3.5 tonnes, as well as all
vehicles that do not run on petrol or
petrol equivalents (ie. all diesel and
diesel hybrid vehicles and electric
vehicles, regardless of weight).#
!
In 2012 the scheme
underwent a major
overhaul with the
passing of new
legislation aimed at
simplifying and
modernising it.#
For heavier commercial vehicles (over 3.5
tonnes) an approved hubodometer or a #
specified electronic distance recorder
must also be fitted. #
!
All the revenue collected from road user
charges goes into the National Land
Transport Fund
and the Regional
Land Transport
Fund. #
!
!
One of the most
significant changes
was the assigning of
a permanent RUC weight to all vehicles.
(Previously, vehicle operators could
nominate their own vehicle weights,
creating an opportunity for rorting.)#
© Dmitryp | Dreamstime.com - Mount Cook, New Zealand Photo
Under the NZ scheme, vehicle owners
must purchase a licence based on the
vehicle’s assigned RUC weight.#
For drivers of lightweight, two-axle
diesel cars, utes and vans, a 1,000
kilometre licence costs $NZ58. #
The licence must be displayed on the
passenger-side front windscreen and the
vehicle must be fitted with a distance
recorder (in practical terms, this means a
working odometer).
As all national
contributions to
meeting road
costs are met
through fuel
excises, RUC and
motor vehicle
licensing fees, a cost allocation model
distributes these costs against each tax
type and all classes of motor vehicle
user. #
!
The level of RUC paid is calculated to
recover the assigned shares of fixed costs
and road maintenance and renewal
costs, with heavier vehicles paying
progressively more towards the latter,
applying a fourth-power rule as gross
vehicle mass increases.#
!
For more information on the New
Zealand RUC scheme, visit the NZ
Transport Agency website.
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April 2015
Getting a RUC pilot off the ground: US
experts coming to Sydney to explain how
Norma Ortega from the California Department
of Transportation and Jim Whitty from the
Oregon Department of Transportation will
discuss the paths their respective jurisdictions
are taking to get RUC schemes from drawing
board to live pilot.#
In July this year, Oregon will launch a US-first - a
pilot program involving 5,000 volunteer
motorists who will pay a per-mile charge in lieu
of gas tax.#
Meantime, California - facing an annual $5.9
billion backlog in state highway repairs - has
legislated to roll out a pilot scheme of its own by
January 1, 2017. #
Ortega and Whitty will participate in a special
RUC session with Transurban CEO, Scott
Charlton, and NZ Transport Ministry Funding &
Infrastructure Manager, Peter Carr, at the IRF Roads Australia Regional Conference for
Asia and Australasia in Sydney on May 4. #
The session will be chaired by D’Artagnan
Consulting Managing Partner and international
RUC expert, Jack Opiola.#
© Diro | Dreamstime.com - Sunset Landscape Of Portland, Oregon, USA. Photo#
Senior US transport agency leaders involved in
the design and roll-out of road usage charging
(RUC) pilots in Oregon and California will be
speaking about the challenges and opportunities
for trialling new road charging models at a major
road industry conference in Sydney next month.#
Oregon….blazing the trail for RUC in the USA !
“Some states are propping up their
transportation funding with portions of their
general sales taxes, while others are addressing it
with the addition of new sales tax on everything
from restaurant bills to haircuts,” he says.#
But the solution, Opiola says, is much simpler
and fundamentally appeals to the public’s sense
of fairness.#
“Put simply, the public believes it is more
equitable for taxpayers to pay for infrastructure
based on what they use, not on what they earn or
what they own or drive,” Opiola says.#
“If there is one advantage the transportation
sector holds over other government programs
that depend on income, property or sales taxes to
fund their services, it is the ability for roadways
to be self-funding through direct user fees.#
Opiola has been working with a number of
jurisdictions in the United States to implement
RUC schemes, including Oregon, Washington,
Indiana and California.#
“It is a fairer, more equitable and sustainable
system – the more you use, the more you pay.”#
Across the US, states are looking at various
options to meet the funding shortfall for road
construction and maintenance, Opiola says. #
Regional Conference in Sydney in
!
For more information on the IRF - RA
May, visit the Conference website.
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April 2015
Transurban to conduct its own RUC study
Cont. from page 1#
Mr Charlton said that despite
significant progress by state
governments, traditional
funding systems were
outdated, unsustainable and
unfair, and could not sustain
the funding needed to address
Australia’s transport
infrastructure deficit.#
fee approach – 57 per cent vs
31 per cent.#
“Without further significant
investment in infrastructure,
everything we love about the
liveability of our big cities is
at risk,” he said.#
_________________________#
“Our congestion levels are
heading to the levels of the
world’s most gridlocked
cities, with drivers in Sydney
and Melbourne sitting in
traffic for more than 120
hours a year by 2050.”#
making a tangible
Transurban’s decision to press
on with its own road pricing
study is underpinned by
independent research it
commissioned from EY
Sweeny that found most city
motorists favoured a userpays system rather than
increased fees and higher
petrol taxes to fund major
road infrastructure - 60 per
cent vs 15 per cent.#
Twice as many motorists said
a user pays system was fairer
for all motorists than a flat-
Mr Charlton emphasised that
any funding model needed to
make equity a core
requirement on the basis that
not everyone had a variety of
transport options available to
them.#
!
“This is an exercise
about industry helping
to inform debate and
contribution to
progressing a
sustainable and fair
funding model.”
Scott Charlton
_________________________#
“Reform is never easy but we
need to continue the debate
and make sure we look at all
the options with an open
mind,” Mr Charlton said.#
“This is a conversation that
industry, government and
everyday Australians need to
be having if we do not want
to be living in cities where
sitting in traffic jams for
hours each day become
accepted practice."#
Mr Charlton also announced
last month that Transurban
had formed a partnership
with leading global companies
to explore the technology
critical in advancing transport
network management.#
“Technology has been one of
the barriers to a wider userpays system but we now have
a host of new opportunities.#
“We look forward to working
with government and our
partners to look at how those
opportunities have the
potential to enhance the
management of vehicle,
roadside and customer
systems.’’ he said.
About the TRN
The Transport Reform
Network (TRN) is a
partnership of organisations
and individuals that first came
together in 2011 to discuss the
state of transport funding and
financing in Australia.#
The TRN seeks to encourage a
community-wide debate about
how we pay for our transport
infrastructure and services, and
what we get in return.#
For more information, go to
www.transportreform.org
The Transport Reform Network (TRN) is an industry policy group with secretarial support provided by Roads Australia - ACN 004 302 836 ABN 34 834 376 172
Secretariat: 2/437 St Kilda Road Melbourne VIC 3004 P. 03 9821 5255 E. info@transportreform.org
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