Lees-Galloway Iain: Road User Charges Bill — In Committee 
Lees-Galloway Iain: Road User Charges Bill — In Committee 
[Volume:676;Page:21768] 
IAIN LEES-GALLOWAY (Labour—Palmerston North) 
: 
 The first comment I make about road-user charges in general is that earlier in the day I talked about the fact that the Manawatu Gorge has been closed for a great length of time and is likely to be closed all the way through to December and that has resulted in significant additional costs to some businesses and in lost productivity. One of the sources of those additional costs is the road-user charge simply by way of the fact that vehicles have to travel a longer distance to take one of the two alternative routes to get round the Manawatu Gorge. Thus their road-user charges increase as a result of that extra distance travelled mostly in getting between distribution points in Palmerston North over to the Port of Napier or distribution points over in Hawke’s Bay. Another one of the effects is that these two roads are not really built for the type of traffic that is travelling on them currently. The normal traffic volumes are about 600 vehicles a day on those two roads; currently they are carrying 7000 vehicles per day and many of those vehicles are heavy diesel trucks carrying freight and goods between Palmerston North and Napier. The effect on both of those roads is now quite significant and with that will come obviously additional costs in maintaining those roads. I just thought that was an important point to make about road-user charges. 
What we are concerned about in Part 2 of the Road User Charges Bill is that the argument in favour of shifting from a system of nominated weights to gross weights for the setting of road-user charges has not really been set out. We have not heard it articulated by the Government why this change is necessary and how it will improve the system of road-user charges. All we are clear on is the fact that for many operators this will increase costs. Again going back to the example of goods that would ordinarily be carried through the Manawatu Gorge should a vehicle have to go from one point to the other carrying those goods then have to travel back empty this change will significantly increase those costs. Yes we could argue that it is an incentive for trucking firms to organise their logistics in a way that tries to ensure those trucks are not travelling without any cargo on board but often that is simply not possible. Often the nature of the cargo and the nature of the points between which they are travelling means—especially when a vehicle is specifically designed to carry a particular cargo particularly liquids and gases—it is not possible to ensure that a vehicle travels from point A to point B and can then pick up more load at point B and travel back to point A or on to another point. It might be logistically possible for some firms to arrange their affairs in a way that is more efficient but for many products many loads that is simply not possible. 
One of the other arguments that I recall from one of the submitters—I do not remember which submitter it was—at the select committee was that the change to gross weights for setting road-user charges might be an incentive for transportation firms trucking firms to ensure that their vehicles are fit for purpose—that is that they do not have a large vehicle carrying a small weight a weight much less than that vehicle is capable of carrying. That again I suppose on the surface of it sounds like a reasonably sensible argument but for many trucking firms that would require a significant investment in capital and it actually reduces flexibility for those firms. They have vehicles that are capable of carrying a range of weights so that those vehicles can be flexible in the goods they carry and to require firms to have a range of different vehicles to be specific to the weight and volume of goods they need to carry would require a heck of a lot of investment. For many operators I think it would reduce their ability to be flexible and to provide a flexible service to their customers. I suppose there needs to be an element of realism here in terms of what transportation firms will actually be able to do whether we put those incentives in place or not. It is not clear in my mind whether that is the goal of this change because as I said I do not think that the Government has particularly articulated the case for making the change. That suggestion actually came from one of the submitters. 
Chris Hipkins also mentioned EROAD or the electronic registering of the road-user charge. What I have heard from a number of operators is that specifically because this legislation mandates the change from nominated weights to gross weights they are less inclined to take up the electronic road-user charge option because it is a cost. It is a cost outlay for them which would make sense if they were able to reap the rewards of electronically monitoring a change in weight and their road-user charge could be purchased as they went according to the weight they were carrying. But it makes no sense to make that investment in those electronic devices if they are not going to get that benefit—if their road-user charge is going to be based on the gross weight of the vehicle. There would be no advantage whatsoever in monitoring the weight of the vehicle and using an electronic system for doing that. If we are trying to encourage transportation companies to shift into the electronic age and to make use of those sorts of systems the change to gross weights is precisely the opposite thing to what we should be doing to achieve that—and that is direct feedback from the industry which is interested in innovation. Industry members are interested in improving their efficiency but they have to see a reasonable cost benefit from the investment they would have to make. 
There is also some concern that driving trucking fleets down to smaller and smaller vehicles will mean we have a greater number of smaller vehicles on the road and that could have impacts in terms of emissions and also of vehicle congestion on the road. So given all the concerns related to what perhaps some of the unintended consequences of this change may be I think it would be really useful for the Minister to articulate what the purpose is of this change. I think that would be welcomed by members of the Opposition and then we could have a conversation about that once the Minister has explained it. So I will take my seat and hopefully the Minister will get to his feet.