Faafoi Kris: Road User Charges Bill — Second Reading 
Faafoi Kris: Road User Charges Bill — Second Reading 
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KRIS FAAFOI (Labour—Mana) 
: 
 I take a call on the second reading of the Road User Charges Bill. I would first of all like to do something a bit strange and agree with a few of the things that Tau Henare said and say we support a lot of the substance of this bill. But as is our job in Opposition we would like to highlight a number of things that we do not agree with. One of these has already been pointed out by my colleagues David Shearer and Darien Fenton: the changes around the calculation of road-user charges. The change from nominated weights to gross weights is one thing within this bill that we do have serious concerns about. 
For the benefit of those who may be listening at home at quarter to 10 sitting up to listen to the debate on the bill and who are not quite aware of the current regime for road-user charges I think it might be useful to set out as David Shearer did during his contribution how the current system works in order to put into context the inequity of some of the changes within this bill. Currently road-user charges are based on the distance that is travelled by a vehicle and also on the weight that is carried by it. An operator currently has to estimate the actual gross weight to be carried—and that is what the Minister referred to earlier as the nominated weight—in advance. Under that system as David Shearer pointed out the first tonne is not as expensive as the last tonne. So if someone has two trucks of similar configuration and one truck has 10 tonnes and the other truck has 30 tonnes the one that carries 30 tonnes will proportionately pay much more than the one that carries 10 tonnes. 
But under this legislation that situation will be no more. Under the changes in this legislation the calculation of road-user charges will be based on the usual maximum allowable weight of a vehicle. Regardless of what the vehicle is carrying it will be given an average or nominated weight and that is how the road-user charge will be ascertained for that vehicle. According to the Government this has supposedly been done to simplify the process but in essence it will make life tougher for many operators. Unfortunately in this case in terms of the winners and the losers the winners will be the large firms that carry the heaviest loads and do the most damage to our roads by carrying the heavier loads and the losers will be those operators that run trucks at under their capacity. They will also have to subsidise the heavier crawlers that are carrying the maximum weight. Again this is another case of the many and not the few carrying the burden for those that are doing the most damage to our roads. 
There are significant concerns about these changes within the transport industry. As Darien Fenton and David Shearer pointed out these concerns were well traversed when the Transport and Industrial Relations Committee was adjudicating on this bill. We agree with the tenor of a lot of the submissions. The first concern is roughly around the fact that you know if the system ain’t broke why change it? There is no evidence that the current system of nominated weights is performing badly so why do we need to make these changes? Again rebutting a point that David Bennett made about his difference of opinion as to a lack of consultation I say there has been a serious lack of consultation with the industry. Many sectors in the industry have been kept in the dark about the processes and the changes and about the impacts that the changes in this bill will have. I guess it starts to get dangerous when the process is not as transparent as it should be and that will have huge impacts on those people who really do not know what is going to happen. 
If these changes are justified then there needs to be proper analysis and consultation which has not happened. Again this bill is not evidence-based but the Government seems hell-bent on introducing these changes to the way that road-user charges are calculated. A small number of submissions to the select committee were in support of these changes. But again they were from a few bodies and unfortunately they were not representative of the broader transport fleet. As one could imagine they were from those in the sector who carry much larger weights on their vehicles. 
A number of submitters also argued that a very high percentage of operators will end up paying more under the changes to the road-user charge calculations while a very small percentage will be paying less. Not only would there be an increase in road-user charges for them but also there would be a considerable charge for them to ensure that there was a refit and certification costs to make sure that their fleets met the requirements of the new system. In essence those operators say that although these changes are apparently being brought in to be fiscally neutral and to streamline the system—supposedly to make things much more streamlined—things will actually become much more difficult for them. 
In the opening address by the Hon Nathan Guy he mentioned the fact that this measure was meant to be fiscally neutral. But there was a submission to the select committee from one person who revealed that there would be an additional cost for his firm of $18000 per vehicle and that the total projected increase in costs for him would be somewhere in the region of $137000 a year. I think that is hardly in line with the Government’s plan to make these changes fiscally neutral. 
On drilling down into some of the detail in the select committee submissions we find that Jonathan Thomson chief executive of the New Zealand Heavy Haulage Association stated in his submission that the bill was a real opportunity to make compliance easier and less onerous but that the current proposals would make things more costly and more time-consuming. In terms of the lack of consultation he said the new road-user charges framework provided in the bill relies on the detail in the regulations that are to follow it being acceptable but it would be very difficult to provide support for those provisions in the bill without knowing the detail. I guess that harks back to the flaw in the process and the lack of consultation with the industry. 
As David Shearer pointed out in his contribution Toll New Zealand also made a submission on the lack of consultation. In point 2.4 of its submission Toll stated: “The Bill introduces very significant changes to the manner in which Road User Charges are calculated and administered but its real impact will only become clear in the process of subsequent regulation.” On this side of the Chamber we do not think that sort of uncertainty for the industry is good enough. We know what will happen: it will mean that a lot of smaller operators will be paying more. But the uncertainty within this legislation is not good enough and that harks back to the lack of consultation. 
Toll also talked about the impact that these changes would have on courier truck operators. In section 4 of its submission on the bill it said “Another area of concern is the manner in which Road User Charge regulations introduced under the provisions of the Bill could address the operations of small courier trucks. These trucks are typically of a maximum permitted weight of 5-6 tonnes and are currently categorized in the Vehicle Type 2 Band which has a maximum permitted weight limit of 14 tonnes.” Toll went on to say that if the road-user charge was based on 14 tonnes as a maximum it could ultimately render the 5 to 6 tonne courier-type truck uneconomic to operate. Basically it said this legislation may force some operators to go from one truck to two vans forcing more traffic on to the roads and eventually creating a situation where more road-user charges have to be paid. 
There was one good example of this and that was North Canterbury Distributors and a chap called Paul Johnstone. He said he runs five trucks for the purpose of distributing chilled and frozen food. He has a gross weight of 4 to 7 tonnes but under the maximum weight regime he would be somewhere in the range of 8 to 15 tonnes and that would mean a significant increase in costs for his business under the new calculation of the road-user charges. I guess this means that the bigger operators and the larger firms win. 
When we cast around for other examples of situations where this Minister has pandered to big business and shown a lack of consultation we do not need to look much further than my own electorate and the Kapiti Expressway. On the road-user charges and the expressway there has been a lack of consultation. In both the road-user charges and the expressway the interests of big business have won out over the community or the industry. In the case of the road-user charges and the expressway the pleas of the industry and the communities have been ignored. In both cases not enough thought has been going into what the impact of these changes will be other than to ignore the ability of those who cannot shout the loudest. 
Hon Nathan Guy 
: Rubbish! 
KRIS FAAFOI 
: It is not rubbish; it is the complete truth. Just drive down State Highway 1 at the moment and see how the community feels about the expressway. These changes to the road-user charges are skewed towards the interests of big business just as they have been in the case of the expressway.