Road User Charges Bill

I think it is worthwhile making a few introductory remarks before we get into the substance of this four-part bill with some schedules. The bill replaces the Road User Charges Act of 1977, after a review identified several shortcomings.

💬 Darien Fenton: We know this.

It is outdated and complicated. I am pleased that the member Darien Fenton knows this. It does not hurt the Committee to be reminded and educated. As a result, this bill will modernise and simplify the road-user charges system. Overall it will reduce compliance costs, and, importantly, it will reduce road-user charges evasion, which is estimated to be around $30 million a year. That is a very conservative estimate, as well. Of course, as a result of that, the honest guys are subsidising those who are choosing to evade the system. The bill also replaces the existing operator-nominated weights, with all road-user charges vehicles having a permanent road-user charges weight.

I thank the Transport and Industrial Relations Committee for its contribution. Amongst other things, Part 1, which I have mentioned, sets the framework for the electronic management of road-user charges. It allows the road-user charges collector to be satisfied that the system will indeed be secure and reliable. It is also worth mentioning to the Committee that there is a Supplementary Order Paper 287 in the name of the Minister of Transport, the Hon Steven Joyce. In essence, the biggest part of this Supplementary Order Paper will allow an exemption for light diesel vehicles under 3.5 tonnes—those vehicles that are almost exclusively driven off public roads, despite being suitable for use on a public road.

The regulations will need to be consulted on and passed. Of course they will need to include all of the terms of exemption, and no doubt there will be discussion on zeroing in on what would be an appropriate kilometre distance travelled in a radius of a particular activity that will be driven off a public road. Of course, to safeguard this system the penalties will indeed have to be high because otherwise the system could be abused, and the Government would not want that.

I think it is important to note that if someone chooses to take up this option for a light diesel vehicle under 3.5 tonnes, they cannot have it both ways. They need to firm up and say that yes, this vehicle will be operated in this area and off the public road. They cannot suddenly choose to duck into town, which might be 50 kilometres away, and put a tonne of fertiliser on the back of the ute, or indeed take mum and the kids on a long-distance holiday in their King Cab ute.

I also draw the Committee’s attention to other amendments that are included in this Supplementary Order Paper, which are mostly minor and technical in nature, such as to remove certain operators’ requirements to have to retain time-keeping records. These would have created additional compliance costs, and I am sure the select committee is pleased about that amendment.

Tēnā koe, Mr Chairperson Tisch. I acknowledge the Minister in the chair, the Associate Minister of Transport, and remind New Zealanders that he, amongst other things, comes from an agricultural background on the Kāpiti coast. He has reminded us that those people who have four-wheel drive vehicles that are used both on the farm and on the roads will have to obey the rules. I shall go back and tell my father, who is a farmer, that there is a new set of rules coming. He will be distressed to learn that red tape is creeping upwards.

But, despite that small lapse, Labour will support this bill. We will support this bill because irrespective of whichever party is in Government, it is necessary to ensure that we have a way of funding the roads of Aotearoa. It is of immense disappointment to us that the money has been squandered on ideological trophies driven by Steven Joyce called roads of national significance. But that is an election issue and we will put it to the side. We are here on the serious administrative, constitutional business of clauses 3 to 6 in Part 1.

There are other reasons why we will support this bill during the Committee stage. We on the Transport and Industrial Relations Committee had our differences. It is a select committee that works well. We have robust presentations from Tau Henare. We have an absent-minded chair, occasionally, in the form of Mr Bennett, with a contribution from the member from Dunedin from time to time, when the man is not bemoaning the fact that people in Dunedin are largely unemployed as a consequence of poor transport capital asset decisions and where they are made—not in Aotearoa but overseas. Let me come back to the clauses that comprise Part 1. But I must not forget the member for Botany. Although he is physically present, we often feel spiritually he is elsewhere—possibly in the ACT Party or the Libertarianz party—but, that aside, he is a relatively new member and he has a great future ahead of him. As Mr Boscawen and “Mr ACT Leader” depart, he will be able to occupy that space of extreme right, lots of noise, lots of heat, but very, very little lucidity. But I will come back to the bill because it deserves serious consideration, and talking about those members is not actually in the spirit of seriousness.

Modernisation is necessary, and for those reasons, irrespective of whoever occupies the Treasury benches, we cannot have a system governing the collection of fees from our vehicle owners dependent on road-user charges, because that is a key component of how we fund our roading system. There is an area that we will pick up on later, because this is a rather broad part of the bill. We remain concerned, if not distressed, about what level of participation there will be once the regulatory power - making authorities are exercised. The actual road-user charges are levies, and at the end of the day they will not be prescribed in the body of the legislation. They will be the products of subordinate legislation or regulation. Members may or may not know that our former deputy leader—indeed, he was our leader—Geoffrey Palmer, waxed lyrical about this in decades gone by. That remains a very timely reminder to those of us who are in the business of lawmaking that when we move beyond the parent legislation to passing regulations, to please bear in mind—I say to the Minister—that for each regulation that is passed we should be confident about stripping two, three, four, or five regulations off the statute book, so that we are avoiding maintaining redundant regulation. Also, it is a good discipline. Those of us who have come from a background where we have seen how difficult it is to run firms and seen how difficult it is to maintain compliance, and are in parliamentary mode now, should remind ourselves that as we put one regulation in place, we should try to take two, three, four, or five away.

It is easier said than done, and it may be said that I am being a tad frivolous in this regard, but transport, along with fisheries, is an area that blights the legislative landscape because there are so many regulations. I doubt whether there is a single bureaucrat, lawyer, parliamentarian, or, indeed, stakeholder who fully understands the breadth of all of those regulations. So I would like to say that it is important that that particular principle is borne in mind.

The underlying debate in our select committee about this bill related to the fact that a number of carriers were concerned that they would not be actually paying for the load, or lack of load, on the vehicle at a particular point in time; rather, it was going to be the carrying capacity. But let it be said we will support this bill throughout the Committee stage, and will continue to highlight those areas that need further refinement or elaboration, as time permits.

First of all, can I express a token of appreciation to the Hon Shane Jones for that little cameo performance, in this respect. One of the issues that we should all have in the back of our minds when we introduce legislation to the House is what my colleague and cousin has termed getting rid of a couple of regulations at the same time as introducing a new piece of legislation. I actually think it is a very, very good discipline to get into.

However, clause 3 of the Road User Charges Bill specifically says that its purpose is to charge vehicles for “their use of the roads that are in proportion to the costs that the vehicles generate:”. I think that is something we have to spell out in big letters. That is why we have a road-user charge system. It is not to tax, not to be mean, but to actually pay for the roads that diesel vehicles use.

I just want to run through some of the words that I think are important in this bill. They are all based on our plan, Building a Brighter Future; all based around having a brighter future for our nation. [Interruption] I know that the lady from Dunedin would love to mock me, but here are some of those words, and maybe she can mock me later on after she has heard these words.

The bill simplifies the regime of road-user charges. It modernises our system, it is cost-effective, it is efficient, it is fair, it is balanced, and it is well managed. Now, when we look at achieving a brighter future, we see that those are all things that a company, as Mr Jones says, looks at to get that company going, and to get that company moving, so it actually can add to the total sum of our economy.

Labour members can mock Building a Brighter Future, but I tell members that people out there will not mock a brighter future for their companies and this nation. This bill is about simplifying, it is about modernising, and it is about bringing our road-user charge regime into the 21st century instead of having it lie in the past. There are so many things going on—[Interruption] I will just wait for those fellows to finish their little talk.

💬 Hon Rodney Hide: We’re trying to amuse ourselves. It’s so boring.

It is so boring? Well, I do not think that brighter futures are boring. I do not think that brighter futures are anywhere near boring, I say to Mr Hide. I know he is getting out, and so is his mate—

💬 Hon Rodney Hide: The member is.

—and so is Stuart. But I believe in a brighter future for this country, and it is not just about education, it is not about the fluffy stuff; it is also about the nuts and bolts. It is also about the road-user charges. It is also about the man out there who maybe has two or three trucks and wants to be able to run a business. [Interruption] It just goes to show what is going to happen on 26 November—those three will not be here.

I served on the Transport and Industrial Relations Committee and it is a good select committee, well chaired by the member for Hamilton David Bennett.

Kia ora, Mr Chair. Ngā mihi nui ki a koutou. Kia ora. Obviously, painstaking research from the member Tau Henare went into his speech on the Road User Charges Bill. Last week was probably dedicated to writing that speech, and members could really tell.

💬 Hon Tau Henare: In big writing, too.

In big writing. I tautoko the sentiment from the member Tau Henare in regard to the Labour spokesperson Shane Jones, but I will also mention the chairperson of the Transport and Industrial Relations Committee, David Bennett, all the select committee members, and all the submitters who came to the committee and who took the time to submit. I think we had a good process.

This is a really important issue, because every year $800 million is spent on road-user charges, and 580,000 vehicles are paying them. This legislation, dating from 1978, is older than I am. It is a few years older than I am, in fact. In this call I will look at Part 1, clauses 3 to 6. I will look at the purpose clause. When it comes to the purpose of the bill, it is all about facilitating the trucking industry. We see the Government with a whole host of other legislative, regulatory, and financial support measures for the trucking industry, and, again, this is another part of it. So I would like to look at the purpose of this bill—in particular, the purpose to modernise the road user charges system, to improve compliance, and to establish a framework for electronic management. I contend that, in fact, all of these are quite inaccurate. The bill is talking about modernising at a time when we could have greater electronic management of our trucks and our vehicles paying road-user charges on our roads, when in fact we are not using these tools of electronic management. What we are doing is going down an averaging path. In fact, we are going down a dumber path, one might consider, and with it comes a dumber future, Tau Henare might say.

We are talking about compliance. I want to ask a question. One of the reasons why we do not have compliance is maybe that some of the decisions around our transport fund are of doubtful quality. We are looking at a whole bunch of roads of national significance with dubious business cases. Even the current leader of the ACT Party, Don Brash, and his 2025 Taskforce were criticising some of these roads of national significance just on their economics. So if we are going to look at compliance, a key issue has to be actual quality spending in the transport portfolio. When we look at it we see that, across the country, for every dollar this Government is spending on all the walking and cycling, on all the buses and trains, and on all the coastal shipping, it is borrowing and pouring $6 into more roads that, unfortunately, are benefiting only a small part of the country and are of dubious economic quality.

I would rather invest in smart transport alternatives—things like the central business district rail link in Auckland, which would actually reduce congestion on Auckland’s inner-city streets, meaning there would be more space on the roads for those plumbers, those tradesmen, and those trucks using RUC, the road-user charge scheme. We would like to invest money in safer roads. I would like to note, and I am quite proud to say, that the Green Party was the only party to score 10 out of 10 in the Automobile Association’s election ranking, because of our prioritisation on safer roads. Our plan would reduce congestion and deliver better economic benefits.

Essentially, with this bill we have missed the opportunity. We have taken the opportunity to bring in a whole bunch of submitters to look at the road-user charge issue. It is important because the Government itself estimates that it will grow by 75 percent between 2006 and 2031. The problem is that if we are going to have all that freight carried on our roads, be it by logging trucks in my home town of Gisborne, with massive road safety accidents, we are going to see more congested roads, less safe roads, greater emissions, and a freight sector that is increasingly dependent on trucks.

Everyone in this Chamber knows that the road-user charge scheme is one of the only ones of its type in the world. It has considerably huge administration costs. The Road Transport Forum estimated that $120 million a year is wasted in administration of this overly complex scheme, which this Government, in the aim of modernising with the bill, is simply going to continue. Although the Green Party does support a user-pays approach to driving—in particular, for commercial vehicles—we do think it is fair that they pay their fair share. But obviously that is not the case, because when we looked at the Ministry of Transport’s own research from 2006—I believe it was—we found that trucks were paying only 56 percent of their costs. In other words, commercial vehicles are being subsidised 44 percent by the taxpayer. We would like to see an actual user-pays approach when it comes to road-user charges.

When we look at the purposes and the changes in this bill we see that they are not overly controversial. They are not going to make a huge difference. Hopefully, they will make evasion more difficult overall. It is a very important issue. Part 1, clause 3, looks at modernising and simplifying the road user charge system. I wonder whether a fuel excise tax paid at the pump, like we have with petrol, would be much more effective in modernising the system and doing what the purpose of the bill is, which is actually to increase compliance. We have something that is overly complex and very expensive to administer.

The major change we are seeing in this bill is the changes around the maximum weight. On the one hand, we think it is a good idea. We think it will provide an incentive for vehicles to be used to capacity. It is good for overall efficiency and from an environmental perspective. But, sadly, we are simply seeing this bill introducing only a framework for electronic payment. It does not actually go down the path where we could have taken some of the smart technologies that are on the market right now, which we could have been using for full electronic monitoring and payment for trucks. I think we could have looked at trucks above a certain weight level. Obviously, for utes it is probably not realistic. But we think it would have been desirable, it would have helped us to plan the transport network more efficiently, it would have helped the companies themselves with their data management, and it would have helped the Government to reduce administration costs, because it could have more accurately charged road-user charges. It is absolutely ironic that a bill that is in the name of modernising and simplifying the scheme, when we want to access these smart technologies, is simply going down an averaging path of averaging weights. So we think that was a missed opportunity.

The major concern with the changes to the maximum weight was the impact on buses. I acknowledge the Bus and Coach Association, which gave us on the committee a very compelling submission. I also acknowledge the committee members who helped to change the legislation in the select committee. Obviously, it is a truism that a bus carrying schoolkids and the All Blacks bus are absolutely totally different weights and are a totally different kettle of fish from a truck carrying rocks from the quarry, or whatever. I congratulate the Bus and Coach Association on its work in its submission. However, it has been left up to regulation. I think this is something we could have looked at in the committee. What we have essentially done is kicked the ball up to the Minister of Transport’s office. That is a theme of this bill; many big decisions have simply been kicked up to the Minister’s office for him to decide and for him to make in regulations.

The most controversial element in this part of the bill, which could annoy literally hundreds of thousands of New Zealanders, is that what we see when we look from the big picture level is that owners of small, mostly efficient light diesel vehicles will end up paying more, yet it is the owners of trucks at the heavier end of the weight spectrum who will be paying less. Officials continually reassured me that this was not true, because of the way the Minister would do it with the regulations and the weight bands. I hope the Minister can commit to that, because he will have 200,000 or more angry light diesel vehicle owners chasing him around the country, I imagine.

The officials advised us that the rises were only in the order of maybe $32 for a light diesel vehicle covering 15,000 kilometres, and said that is not much. But it is a lot when we look across the whole country. The big fear for the Government, of course, is that it can be accused that this bill is simply about taking the costs from everyday Kiwis with their efficient light diesel vehicles and, in fact, subsidising trucks, given the Ministry of Transport research that I have already quoted. I think it is critical that this Government does not disadvantage the small, efficient diesel vehicle owners.

Another area where we missed an opportunity is that this bill continues what we currently have in exempting electric car owners from paying road-user charges on our roads. It is great to incentivise electric cars. I think they will be part of the solution in the medium to long term. However, electric cars have not been wildly successful. We have only 40 electric cars in the country, despite all of the hot air we are hearing from Government members about how they are the answer. The main reason why we are investing or borrowing to invest $13 billion at a time of a deep global recession, a deep debt crisis in New Zealand with credit downgrades, is for new motorways and new roads of significance to National. We lament the opportunities to actually encourage greater efficiency of use. This will benefit our economy and benefit householders, who, for the average Kiwi family in New Zealand, are paying around $6,000 per year, on average, in fuel charges.

It is disappointing that this bill seems entirely predicated on trying to help out these heavy vehicle owners, yet we are disadvantaging smaller vehicle owners. I hope the Government looks at this in regulations and tackles it, but we will be voting for this bill in the Committee stage, because, overall, it is not controversial.

It is a pleasure to take a call on Part 1 of the Road User Charges Bill, particularly in relation to the purpose.

💬 Hon Rodney Hide: Tell us about the Mad Butcher.

Yes, well, we can talk about the Mad Butcher, but I would rather talk about this bill, actually, I tell Tau Henare.

💬 Hon Tau Henare: Have you apologised yet?

Well, actually, yes. If the member kept up, he would know there have been apologies. But we are here to talk about the Road User Charges Bill. The member from Te Atatū might want to be a little bit more concerned about some of the people in his electorate who are concerned about this bill. They have been talking to me about the purpose of this bill, and the concerns they have around the shift from nominated weights to gross weights as a basis for road-user charges.

💬 Hon Tau Henare: How could you?

The member can yell and yell, but I am here to talk about the purpose of the bill.

As I said, Labour supports this bill, but we still have some major concerns that we want to talk about. The first concern is the shift from nominated weights to gross weights. The second part of the purpose of the bill that we are concerned about is the fact that we do not get to vote on the changes to this bill and the charges in this bill. Those were the things that came through from the select committee—the major concerns from the industry. The fact that the regulations will be sent off to the Minister—the regulations surrounding the charging of road-user charges; the changes to this—is a break in the basic democratic principle that there should be no taxation without representation.

Tonight we are debating the Committee stage of a bill, but we have no final numbers, and the industry still does not know what is meant under Part 1 and the purpose when we start to talk about the changes to road-user charges—and, in particular, the changes a little bit further on in Part 1 around the road-user charges weight. That is in clause 5, where the calculation of weight in relation to road-user charges vehicles changes from a gross vehicle mass to a maximum allowable weight.

I want to mention that there were a number of submissions. This is the controversial part of the bill. There are two parts to this; I will mention one in a minute, but the second is about the fact that the charges will go through regulation, and regulation will determine what the charges are for truck drivers, who I thought were the friends of National, actually. I thought they were the friends of the National Party, but if those members think we have problems with the Mad Butcher, they should start talking about their problems with the transport industry. I have been talking to a number of people in this industry. They came to the Transport and Industrial Relations Committee. They made submissions on this bill, and they have been ignored; they have been ignored. They are extremely concerned, because what this bill will do is impose costs on the business—the business that the National Government says that it supports. This is road transport, both small businesses and larger businesses. National members have not listened. That is one part of our concern with regard to Part 1.

Part 1 is very interesting, because it outlines all sorts of interpretations and other things, but that is one concern. A little bit further on we will talk about our concern, as I mentioned, about how these charges from the National Government will be determined by regulation, without any reference to this Parliament. Why should the friends of the National Party be having to sign up to the fact that there are—

💬 David Bennett: How hard is it?

What?

💬 Hon Shane Jones: The Warriors.

The Warriors—oh, look, come on. Members opposite should be much more worried about their friends in the transport industry. They should be much more worried about that, but they have no respect for them. Members opposite think that they can just sit there, make rude comments and disgraceful comments about things that are completely irrelevant to this bill, and, at the same time, ignore the major concerns in the industry about the shift from nominated weights to gross weights. [Interruption]

The CHAIRPERSON (Lindsay Tisch): I am sorry to interrupt the member. We are actually not interested at this time about what is happening on the rugby field or with the Warriors. Just concentrate on Part 1 and can we just continue.

Thank you very much, Mr Chair. As I was trying to say, there are things that we support about this bill. We think that the purpose is sound, but there are things we are concerned about, as well. We want to make sure that we continue the road-user charges system by imposing charges on heavy vehicles and certain other vehicles for the use of the roads, in proportion to the costs. We think it is good that we modernise and simplify the road-user charges system and that we improve compliance with and recovery of road-user charges. However, there are issues, which have not been resolved, that were raised at the select committee. They are not resolved in the industry, either, and I think that the arrogant members on the other side of the Chamber will find that there are quite a lot of people in the transport industry who are not very happy about that. This issue has not settled down, those people have not been listened to, and I think members will find that there will be some agitation around a couple of proposals in this bill.

We support the move to a 21st century, electronic road-user charges system. We should be using whatever technology is available to us. But the move from nominated weights to gross weights for setting road-user charges is still causing quite a lot of angst. Members opposite can laugh, sneer, and do all the other things that they want to do. They can, because they are arrogant and because they think that they do not have to listen to people any more. As we have seen in the Transport and Industrial Relations Committee quite frequently, when people bring issues of transport safety to the Transport and Industrial Relations Committee—

💬 David Bennett: Great committee, great committee.

No, it is not a great committee. It has a reputation now for not listening to the people who bring their issues, both through petitions and through their submissions on Part 1. Although we support the changes in this bill overall, there are concerns. I think it is incumbent on the National Government to start to listen to the industry—

💬 Hon Member: Who to?

Maybe David Bennett thinks that he does not have to listen to anybody. Maybe he thinks—

💬 Clare Curran: He’s got nothing to say.

Well, maybe he has nothing to say, and maybe he has nothing to say about Hillside railway workshops, either.

💬 Clare Curran: Doesn’t know how to say yes or no.

Well, that is true—yes or no. He does not know the answers to either of those. But I find the Committee stage of this bill—Part 1, in particular—particularly interesting, because Labour has concerns about two aspects of this bill. We have continued to say what they are. We will vote for this bill overall, but we are concerned about some things in this bill. Submitters came to the select committee and there were very, very strong submissions. The National Government has chosen to ignore them. Those two things are in Part 1: the shift from nominated weights to gross weights as the basis for charging for road-user charges, and, a little bit further on is the fact that we cannot actually vote on the level of road-user charges that will be applied because that will be established later by regulation.

The conversations that I have had with those in the industry show that there is real concern about it and real concern about the fact that this Government is so arrogant that it thinks it can decide on charges without consultation and without any proper process through this House. The National Government is so arrogant about these things, but underlying this bill there is some real concern about the move from driver-nominated weights to gross weights. Members of the industry are looking for some real respect from this Parliament with regard to listening to what they have said about the charging and the change from driver-nominated weights to gross weights.

I move, That the question be now put.