Comments last week by Treasury Secretary Dr Ken Henry on road pricing reform (see below) attracted a lot of media interest around the country.
The Age interpreted Dr Henry’s comments as an indication that his about-to-be-released tax review is likely to propose a shift from fuel excise and registration to road-user charging.
The Australian Financial Review followed up with an article that quoted a number of experts canvassing a range of road pricing models, including road-user charges and congestion taxes.
The Courier Mail put a local spin on the story, citing Lord Mayor Campbell Newman’s concern over the prospect of a congestion charge for Brisbane. Cr Newman reportedly told the Mail the problem of congestion could be better solved by improving public transport and increasing road funding.
Meantime, today’s SMH carried a front page story on a new report from the Association of Consulting Engineers Australia, called Sydney Towards Tomorrow, which purportedly advocates a user-pays model for roads and public transport.
Today’s Herald also carried a story on a report by the Australia Institute that calls for the introduction of time-of-day charging on all of Sydney’s major roads in a bid to ‘ration’ road use.
In other road news, the Daily Telegraph accused the RTA of not having ‘a single plan’ to fix Sydney’s most congested roads. In response, Transport Minister David Campbell was quoted in the article as saying a range of measures were being delivered to address the problems.
And the Sunday Telegraph claimed this week that rises in motorway tolls in Sydney had outstripped inflation over the past decade.
Treasury Secretary Ken Henry has given the clearest indication yet of his views on road pricing reform ahead of his much anticipated final report into Australia’s future tax system.
Speaking at a CEDA lunch last week, Dr Henry said one of the biggest challenges in introducing major tax reforms like road pricing was creating a compelling case that outweighed the cost of compensating those unfairly impacted by the reform.
Dr Henry questioned why governments had stuck to the traditional 'fuel tax and rego' model for roads when “...sensible pricing seems to offer such large benefits?"
“Personally, I think it is the inherent difficulty in deriving a feasible compensation framework,” he said.
Dr Henry said the case for change needed to be made.
“It is fast becoming one of the biggest public policy issues of the age.
“We need innovative ways of dealing with the community's distributional concerns. For example, some truck operators might support road pricing as long as the costs they pay are reflected in better roads — their 'compensation' is a better functioning road network. They would also like assurance that the compliance costs of road pricing will be low and remain low. At least one automobile association supports road pricing as long as road users are 'compensated' by the abolition of fuel excise.
“There are some instructive examples overseas. In London, commuters were 'compensated' through additional funding for public transport. An innovative study in Seattle gave some drivers credits to pay to drive on congested roads and let them cash in the savings they made by driving at off-peak times or choosing other modes of transport.
“Reforms like road pricing will be difficult, but these overseas examples show that it is possible.
“Compensation is inherently a political problem, as it is the political process that identifies those affected and those in need. Our political history reveals a capacity to manage massive change, given sufficient time.”
The full text of Dr Henry’s speech can be viewed at Australia's Future Tax System website.
The Prime Minister and South Australian Premier last week released a design concept for a South Road Superway they say will be the backbone of a dedicated north-south transport corridor for Adelaide.
The Superway will connect from the Port River Expressway to Regency Road, reducing travel times by up to seven minutes and improving safety for the up to 45,000 vehicles that use this section of the road every day.
It will also improve productivity for the 17 per cent of vehicles using the road that carry freight, including b-doubles and road trains, by linking to Adelaide’s industrial precinct, Airport, Islington Rail Terminal, Port Adelaide and Outer Harbor.
The project will include:
The Federal Government has committed $500 million to South Road and the South Australian Government $430 million.
Planning is expected to be completed in mid 2010. Construction on local roads is expected to commence in March 2010. The South Road Superway is expected to be open to traffic in late 2013 – six months ahead of the original schedule.
For more information, including concept images and vision of the South Road Superway, go to www.infrastructure.sa.gov.au.
The NSW Government and Transurban, the owner of the Hills M2, have this month announced an in-principle agreement to develop a major upgrade of the motorway. Leighton Contractors has been selected by Transurban as preferred contractor for the $550 million upgrade.
NSW Transport Minister, David Campbell, welcomed the in-principle agreement, which provides a green light for further design work and an environmental assessment to proceed, in consultation with the community.
Mr Campbell said the upgrade would be funded by Transurban, with the NSW Government contributing by extending the M2 concession by four years, and allowing for a one-off increase in the toll of around eight per cent on completion of the work.
The in-principle agreement was reached following negotiations over the technical and commercial details of the project.
Under the agreement with Transurban, Leighton Contractors will deliver the environmental planning, design and construction of the upgrade project.
Subject to environmental approvals, the Hills M2 upgrade incorporates the widening of existing sections of the roadway from two to three lanes including the Norfolk Rd twin tunnels, the addition of new access ramps, and the upgrade of operational management and control systems.
Leighton Contractors will commence work immediately on the environmental approval process which will be carried out in parallel with the detailed design.
Construction of the Hills M2 upgrade is scheduled to take two years following environmental approvals and financial close on funding for the project which are expected in late 2010. Completion of the upgrade is expected by late 2012.
The NSW RTA has called for tenders for construction of the Bulahdelah Bypass on the Pacific Highway, with the bid process closing on November 25.
Federal Infrastructure and Transport Minister, Anthony Albanese, and NSW Transport Minister, David Campbell, say construction is expected to start early next year.
Mr Campbell said the new 8.6 kilometre four-lane bypass will replace the existing single carriageway running through the township of Bulahdelah.
“Once completed at the end of 2011, the new bypass will deliver safer driving conditions, shorter travel times and take up to 4,000 trucks a day off the local streets of Bulahdelah,” said Mr Campbell.
“The successful contractor will be responsible for building the bypass, including 12 bridges, drainage ways, noise and retaining walls, signposting and landscaping.
“Already work on relocating power lines and other utilities is underway.”
More information about the project can be found on the RTA website.
Tenders have been called for the large-scale earthworks at the southern end of the Bruce Highway (Cooroy to Curra, Section B) upgrade, in Queensland. Bidding closes on November 17.
Queensland Main Roads Minister Craig Wallace said this week the second package of work was critical to fast-tracking the project while minimising disruption for motorists.
“This package of work will build a two-kilometre southern deviation off the Bruce Highway near Federal between Sankeys Road and Middle Creek Road, allowing for construction of the new bridges over Skyring Creek,” said Mr Wallace.
“Work is expected to start in January 2010.”
The third and final construction package will be called in mid-2010, with work on the entire 12-kilometre section expected to be completed in 2012, weather permitting.
Meantime, in other Queensland road news Mr Wallace has this month released the preferred planning option for a potential Kenmore Bypass, but says no decision has been made about whether it will proceed.
The preferred planning option is a four-lane bypass (two lanes in each direction), linking Moggill Road and the Centenary Motorway.
Most RACQ members are prepared to pay a small congestion charge on Brisbane’s inner city roads if this means they will encounter fewer traffic snarls at peak times.
An on-line transport costs survey of more than 2000 motoring club members has revealed the majority are prepared to pay $5 a day to cut travel times on Brisbane roads.
RACQ general manager for external relations, Gary Fites, said 50 percent of the members surveyed regularly drove on congested roads and 93 percent expected congestion to worsen over the next five years.
"Fifty-seven percent said they believed a congestion charge would improve traffic flows," Mr Fites said.
"And just over half the members - 54 percent - said they would support a congestion charge of around $5 a day.
"But the level of support dropped quickly when higher charges were suggested to survey respondents, and 26 percent of those surveyed said they would not support a congestion charge at all."
Most of the members willing to pay a small congestion charge wanted to see the charge operating from 6.30am to 6.30pm weekdays or during morning and afternoon peak hours only.
Mr Fites said 85 percent of members surveyed wanted more money spent on transport infrastructure. Of these, 68.37 percent were seeking more spent on roads, 17.01 percent wanted more spent on trains, 8.58 percent wanted more spent on buses and 6.38 percent wanted more spent on walking and cycling facilities.
Congestion in Brisbane alone is estimated to cost $1.59 billion annually and this is expected to top $3 billion by 2020.
RACQ has released a new fact sheet on road congestion in south-east Queensland, which includes a detailed analysis of measures to address the problem.
An independent study has confirmed that EastLink continues to consistently deliver significant travel time and fuel savings for motorists in Melbourne’s east.
The findings from surveys conducted for ConnectEast show that a full 39 kilometre trip on EastLink in the morning peak period delivered an average travel time saving of over 40 per cent (or more than 20 minutes) when compared to the alternative routes of Springvale and Stud Roads.
Similar travel time savings were recorded during the afternoon peak period on work days and these also translated into fuel savings for motorists of between 17 and 20 per cent.
ConnectEast Managing Director, John Gardiner, says there have been more than 64 million trips on EastLink since tolling began and the growth in average daily trips of over 20 per cent to more than 163,000 demonstrates that more motorists are recognising the travel time and fuel savings on offer.
The study also found that EastLink provides a greater level of certainty for motorists regarding how long a trip will take them at different times of the day.
Submitted by Mark Bowmer on Friday October 23rd 2009 12:53pm
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