Land Transport and Road User Charges Legislation Amendment Bill

I am happy to take a call on Part 2 of the Land Transport and Road User Charges Legislation Amendment Bill. I think it has been an interesting discussion from the Labour and Green members of the Committee, who have made a contribution to this debate by reflecting on what our transport system should be, and how we use most effectively the fees that are taken from freight vehicles and others in road-user charges, but also how we use the National Land Transport Fund and the money that goes from petrol excise tax into a special fund—which Labour actually did; it is called hypothecation—to build a transport system that is fair to everybody and that takes into account users of all modes of transport, and that makes sure that people can get about and get to work, can get to school, can get to amenities, and so on. That is why we see in places like Auckland, where I live, such a huge focus now on public transport.

It was very interesting to be at the event the other day where the electrification was turned on—the member Julie Anne Genter was there too—and to see John Key turn up for it. John Key turned up, and Gerry Brownlee, and a whole lot of National Party MP hangers-on, for this great event about electrification. I was bemused by that because, actually, it was a Labour Government working with the Greens in 2007 that initiated and funded electrification of the rail.

💬 Hon Annette King: Who was the Minister?

Who was the Minister then? Well, it was the Hon Annette King. It was a fantastic decision, and I was very, very proud to be there. There was not one bit of recognition the other day from that Government of that, and also not one bit of recognition from the Government that it was Labour that did the double tracking in Auckland so that we are going to have a rail network in Auckland in the future, once the Government gets over itself and funds the City Rail Link as well.

The whole transport portfolio, the transport policy, is really important to everybody in the country. But this bill, as I said, is correcting a small anomaly, and I want to go back and talk about another one that I encountered during the adjournment. Out in the country, out in the regions travelling around the rural roads, you can see it everywhere you go. This Government has sucked up funding through its roads of national significance, its gold-plated highways to nowhere, and regional roads and rural roads are missing out. Councils up and down the country are up in arms because the Government is reviewing funding assistance rates funding, which is the funding that helps them keep their local roads in order. They are very worried because what it means is if the funding review comes out like it has been looking like it will, it is going to cost ratepayers a whole lot more.

But for me the most interesting visit I had was to the East Coast, to Gisborne, the other day, where I met with some truck drivers. I know that the Road Transport Forum likes to think I am anti-truck. I am not anti-truck; I am pro - truck drivers, because I think they have got a really hard job. Those two truck drivers drive forestry logging trucks. They are driving them day in and day out because forestry is booming on the East Coast. They are driving these huge rigs that they pay half a million dollars for, and they are driving them on shocking roads because this Government is ignoring the funding that is needed in rural areas like the East Coast for secondary roads, and it is putting those drivers to work on unsafe roads. The roads are rutted. They are unsealed. They fill up with mud. Trucks slip and slide everywhere. The culverts overflow.

The forestry industry infrastructure has been neglected. It has been neglected by this Government, yet the Minister sitting in the chair at the moment, the Minister of Labour, knows the consequences of ignoring safety in the forestry industry. He knows the consequences of that, yet on one road there have been two deaths in the last 6 months—two accidents killing forestry logging drivers. I talked to these guys I met. These are hard-working guys. They are owner-drivers, so they own their own businesses, but they are really upset. Their comment to me was “We pay something like $53 million in road-user charges in this area. We see nothing of it—we see nothing of it.”

Every day, they tell me, there are 10 near misses on that road. It is not just the forestry logging truck drivers at risk; a bus was run off the road the other day—it is other drivers on those roads. It is really, really dangerous, and, as I have said, forestry is booming on the East Coast and it is going to continue to grow as more trees come on line. So I cannot understand why the Government is not on to this and is not doing something to repair its critical neglect of forestry roads—in particular, secondary roads—and why it has embarked on a funding review for regional councils when regional councils are so worried about how they are going to get their goods and services out, and how they are going to keep their drivers safe and their road users safe. It is the same in Northland—it is the same in Northland. The mayor up there has been raising this issue, and we have had no answers.

Labour has an answer—Labour has an answer. We announced our forestry policy 2 weeks ago and we also announced that we would put back in $200 million of funding for critical regional roads in the forestry industry. So we have an answer for those truck drivers. They know that Labour believes that their lives are worth standing up for and doing something about, and believes in helping them earn a living, helping a town like Gisborne flourish, helping it come along, and helping this whole forestry industry, which is so critical to our country. And, of course, we want to see value-add as well, so it is not just logs coming out of the forests and to the ports.

So I think there is an anomaly. There is an anomaly in road-user charges, where this Government does not take into account the issue of the sole truck driver in Gisborne driving his half-million-dollar rig. Actually, some have been split in half. That is how bad the roads are—their tyres split. The Government does not take that into account. It listens to the big boys. So when you have submissions on road-user charges, you hear from the Road Transport Forum and others, but it is not often that a lone truck driver driving on dangerous roads actually gets to have any say or gets heard by this Government. So I challenge those members to go to Gisborne, meet the same drivers I did, get in their rigs, go on those roads, and see how they feel about it and how dangerous it is and how scary it is. It is not just, as I said, those truck drivers who are paying their road-user charges and are keeping their trucks up to scratch as much as they can. It is not just them; it is the other road users who are also at risk.

We have to take responsibility for it. This is a problem with the road-user charges system. The Government is neglecting rural roads and regional roads, and our road-user charges system will not be sufficient until the Government understands that we have got to have a fair share of the National Land Transport Fund that goes not only to cities but also to regions, which are so critical for our future.

💬 Simon O’Connor: Like Whangarei—that new bridge.

Whangarei—go and talk to them in Northland, absolutely.

💬 Simon O’Connor: The new bridge.

A new bridge—but the forestry roads are shocking. People are driving off them. I have someone who rings me every morning—who lives on State Highway 1 and says “There’s been another truck gone off the road, Darien.” You start monitoring it.

💬 Mike Sabin: Every morning?

That member should start monitoring it. Government members do not like it when we—

💬 Carol Beaumont: Hitting a nerve.

Yes, hitting a nerve. You do not like it when Labour stands up for the drivers, for truckies. They do not like that—they absolutely do not like that.

So, as my colleagues have said, we are supporting Part 2 of this bill. The legislation needs to be fixed. Of course we are supporting the bill. It is a waste of time that we are having to do this. I would much rather that we were spending our time in this Chamber doing something for those hard-working forestry truck drivers, those logging truck drivers who are putting their lives on the line every day to help their families and to help the economy. I would rather we were doing something about that and that, instead of those members shouting across the Chamber from the other side, we were putting our heads together in the Transport and Industrial Relations Committee and coming up with a solution, because this is dangerous work.

💬 Mike Sabin: I’ll tell you what the solution is: keep Labour from the Treasury benches. That’s it right there.

Pardon?

💬 Carol Beaumont: Take a call.

Take a call. That is a good idea—that is a good idea. So, as I said, I am pleased to support this bill.

I call the honourable member Julie Anne—[Interruption] Have you finished? [Interruption] I call the honourable member Julie Anne Genter.

I have to strongly agree with the contribution just made by my colleague Darien Fenton. Part 2 of this—[Interruption]

The CHAIRPERSON (H V Ross Robertson): Order! I am sorry to interrupt the member. It has been a convention in this place for a number of years now that when people who do not have the floor interject on each other, that is not in keeping with the custom of practice of this House. I urge members to remember that.

Thank you, Mr Chair. I have to strongly agree with the contribution just made by my colleague Darien Fenton on Part 2 of the Land Transport and Road User Charges Legislation Amendment Bill, which amends the Road User Charges Act.

I think that for the benefit of members in the Committee today there is probably a little bit of background that needs to be explained about how the road-user charges system works. Central government spends about $3 billion a year on transport through the National Land Transport Fund. Most of that revenue comes from petrol tax and road-user charges. As I said earlier, about a third of it comes from road-user charges—that is, the contribution from heavy vehicles, trucks, and commercial vehicles using diesel. They contribute about $1.1 billion, which goes to the National Land Transport Fund. Petrol tax is about $2 billion a year. What is often overlooked when people say that roads are paid for by users is that, actually, that is not entirely true. Local roads are 50 percent funded by ratepayers. Ratepayers pay $1 billion, which is spent on transport. So the overall transport infrastructure funded by Government is about $4 billion—$1 billion from ratepayers. It is worth noting that about 50 percent of all vehicle kilometres travelled happen on local roads, so it is quite a big proportion that is subsidised by ratepayers.

But what is really overlooked when we talk about the economic benefit of our transport system is the huge cost to households and businesses to use the infrastructure that is being paid for with their tax dollars. Taxpayers are paying $4 billion a year. That is being spent mostly on roads, mostly on a few State highways. The largest share is going to go on a few State highways, which carry a tiny proportion of all vehicle trips over the next 10 years. A large portion is going to be to pay the interest on the debt that we use to fund those projects. That is going to go on for about 25 years. But what is really overlooked is that households and businesses are spending at least three times that much just to use the infrastructure that is being built with their tax dollars. Households spent about $11 billion on fuel and vehicles last year. If we included the cost of businesses—the money that they put into their vehicles—I am sure it would be even more than that.

So when we talk about what is the most economically efficient way to reduce transport costs in New Zealand, minor improvements to the roading network probably are not the best way to make those savings, because households and businesses have to spend well over $11 billion a year just to use the infrastructure. All of that money goes overseas, because we import all of our vehicles and all of the fuel that we use to run them. Even if we did find some oil offshore, it would not be used in our cars and trucks, because we have light sweet crude oil, which we export, and we do not have the capacity to refine it. It would not be the highest-value use of that fuel.

I suppose what the Green Party is saying is that a more rational approach to transport investment that would actually get better bang for our buck is to invest in the modes that have been underinvested in and that benefit not only the people who use them—the people and goods that go by rail or by passenger transport, whether that is by bus or by ferry, or the people who walk or cycle. If you do all of those things, then you get better use of your road network, but you also save money on the other side, because you save the money that households and businesses are having to spend to use the road network.

Unfortunately, it was the National Government that decided not to reopen the Napier-Gisborne line—

💬 Shane Ardern: Yeah, but who closed it?

Well, it was the National Government that closed that line.

💬 Shane Ardern: No, no, no.

Yes, that is what happened. We have enormous potential to invest in our rail network, which would result in quite substantial regional economic development and reduce some of the very, very high inter-regional transport costs that we have here in New Zealand. The reason why we should use the transport budget to pay for that is that it also benefits road users. At the moment, when we evaluate the benefits of investing in a State highway, we look at the safety benefits and we look at the wider social and economic benefits. But when we look at KiwiRail, we say “Well, you’ve got to fund all of your infrastructure investment simply from the return that you’re making from your freight business.” That does not make sense. The usage—

💬 Shane Ardern: A billion-dollar subsidy upfront was pretty good.

It is not $1 billion a year; it was only $250 million a year. The Government is not investing enough in the rail network, and that is a missed opportunity because it impacts our road network. Making it possible for some logs and some dairy products to move more quickly and more frequently by rail takes huge heavy trucks off our roads, reduces the amount of money we have to spend on maintaining those roads, increases the safety for people who are driving in their cars on those roads, and benefits our exporters because it reduces their costs of getting their products to market.

So it would make a lot more sense to take some of that enormous capital expenditure that is going into a few very low-value motorway projects in peri-urban areas, which do not even carry that much of our exports, and invest some of that in the rail network all across the country, getting regional economic development, increasing the safety of those roads, improving the maintenance of those roads, and also improving congestion. If we invest, for example, in the City Rail Link in Auckland, we can get a lot of commuters off the roads. That frees up the roads for those people who need to travel by car, whether they are a plumber or a builder, and who have to get around by road at peak time. The best thing for them is if we can get hundreds of thousands of cars off the road, and we can do that by improving our passenger rail. Since we have already invested in electrification, it makes sense to build the City Rail Link, because that actually doubles the capacity of the entire rail network. It means we can get 5-minute frequencies, which makes rail that much more attractive for people who are using it to get into and around the city and who do not need to use a car. Once the western ring route is opened, there will be alternatives for freight. The last thing we want to see is that road clogged up with commuters who are trying to get to houses that are being built way out of the city. That would not be good for road users. It is not good for freight.

So what the Green Party says is that we want an economically rational investment in our transport fund. We have to keep in mind that the way we use road-user charges does not need to be on new roads. Spending money on expensive motorways with low benefit-cost ratios is not the best use of road users’ money. In fact, investing in rail is, in some cases, a better use of road users’ money, because it has a better impact on the overall economy and the transport system, whether that rail is for passenger services or for freight in our regional areas. So there are lots of opportunities. This bill makes just some tiny technical changes. The overall direction that the Government is going on transport is wrong. It is actually to tax and spend—that is the approach that the National Government is taking. It is borrowing, taxing, and spending the money in ways that are not going to benefit taxpayers, are not going to benefit the economy, and are going to cost New Zealanders for decades to come. That is a very serious concern.

In rising to speak on Part 2 of this bill, the Land Transport and Road User Charges Legislation Amendment Bill—Part 2 contains the changes that amend the Road User Charges Act—I just want to identify a few of the elements that are in Part 2. There is provision in Part 2 around the situation where people are required to have a distance licence as part of their road-user licence, where the vehicle concerned is used outside the terms of its road-user charges licence, and the question around what defence there is in that situation. The Transport and Industrial Relations Committee, in dealing with this, has suggested an amendment here to clause 6A in Part 2, inserting new sections 9(4A) and 9(4B). This is around “reasonable excuse”—the amendment “gives guidance to operators and to enforcement authorities as to a particular circumstance that might constitute a ‘reasonable excuse’, without otherwise altering the effect of the provision”. So that has been done in Part 2, where it sets out what happens in the situation where the vehicle does not have the correct licence for the type of road-user charge vehicle that it is. So that is one of the elements of Part 2.

Also in Part 2 are the provisions in clause 12 around an offence provision relating to breach of conditions associated with section 40 of the Road User Charges Act. That is in the situation of a “light RUC vehicle operated almost exclusively off-road”. That provision is outlined. It adds an offence provision, new section 40(7), to support the enforcement of conditions associated with exemptions granted under section 40. The proposed penalties have been set out to be commensurate with penalties associated with other offences of similar seriousness. There are a number of minor technical amendments that are covered off in Part 2 as well. One of the provisions is to clarify one part, section 57(1)(a), by putting the word “user” after the word “road”.

This is a clarification to try to tidy up. Again, as I commented in Part 1, Labour does support this bill. It is fixing up some matters that do need to be fixed up. It did have a rather tortuous history to get us here.

But the real question—and it is one that Darien Fenton and Julie Anne Genter have both raised here—is how all of this relates to any coherent strategic direction for transport in this country. The fact of the matter is that this is an area where the Government is taking a very piecemeal approach. I thought it was a very interesting suggestion that Darien Fenton made, actually, in her contribution on Part 2, because, in fact, we do have the Transport and Industrial Relations Committee. What a fine opportunity, in fact, for that select committee particularly to deal with questions of logging trucks and the types of roads that they unfortunately have to use, causing serious accidents and being part of the horrendous health and safety problems we have in that industry. So there is a question of the types of roads and transport used and the failure, in fact, to make greater use of rail—for us to use rail more effectively, especially along the main trunk—and to look at that in conjunction with the conditions of work of people working in the forestry industry. I think that is an exceptionally good idea. I think it is one that the select committee should take up.

Of course, the chair of the select committee, David Bennett, happens to be in the Chamber. I am sure that Mr Bennett will want to jump up and agree with us on this matter—agree with us on this very good suggestion made by Darien Fenton, which is a serious suggestion. It is not a joke. This is a real problem we have. It is a problem in this industry that could be serving this country a great deal more. We could be doing a whole lot better with the forestry industry and with products from the forestry industry. We could be creating better jobs, safer jobs, jobs that pay people for a decent standard of living, and creating added value in our economy. This is an opportunity to look at an industry that is very important for this country, and to make sure that not only is it providing decent and safe work for the people who work in it but also is ensuring that we can use forestry and the wood products from it to ensure that we have better jobs throughout our economy; that we add value to logs and end up with products that we can get far higher prices for.

Labour has outlined a strategy for the wood industry—a strategy that sees us moving from the situation where we currently cut down trees, create logs, put them on trucks and sometimes on trains, and take them and export them offshore as logs. What does that add? As Ms Fenton has outlined, we have an industry that is very, very dangerous, including for the truck drivers who drive those trucks on those forestry roads. We need to invest more in those roads to get logs off safely and to use our road-user charges and other funding of land transport to do that, rather than funding some of the roads of national significance. But we also need to look at getting those logs and doing things with them. This is the sort of strategic approach that we need in this country to create better jobs, to create greater wealth for this country so that we can ensure that that wealth is then distributed fairly.

All of these things are completely beyond the scope of understanding of members opposite. Strategic decision-making is clearly not something that the Government is willing to do. Piecemeal approaches, generally hands-off approaches are what it does best. It is not focused on issues like creating decent work for New Zealanders. It is not focused on a strategic approach to transport that makes sure that the transport system serves the people of this country and the businesses and the jobs that they create. This is something that is completely foreign to members opposite. I would note that in discussing this bill we have yet to have a contribution from a member of the Government. It would be very good for them to get up and talk about this bill. I would really urge David Bennett, the chair of our select committee, to get up and talk about the very good suggestion that has been put on the table today by Darien Fenton about us looking in a collaborative manner in our select committee at issues related to both transport and employment in the forestry sector. Thank you.

Part 2 agreed to.

Clause 1 agreed to.

Clause 2 agreed to.

The Committee divided the bill into the Land Transport Amendment Bill (No 2) and the Road User Charges Amendment Bill, pursuant to Supplementary Order Paper 428.

Bill to be reported without amendment presently.