House of Representatives

Road Charges Legislation Repeal and Amendment Bill 2008

Explanatory Memorandum

Circulated by authority of the Minister for Infrastructure, Transport, Regional Development and Local Government the Honourable Anthony Albanese, MP


The purpose of the Road Charges Legislation Repeal and Amendment Bill 2008 (the Bill) is to repeal the Road Transport Charges (Australian Capital Territory) Act 1993 (the Road Transport Charges Act) and parts of the Road Transport Reform (Heavy Vehicles Registration) Act 1997 (the Heavy Vehicles Registration Act) which refer to the Road Transport Charges Act. The Bill also amends the Fuel Tax Act 2006 to implement changes to the heavy vehicle road user charge necessary to give effect to revised heavy vehicle charges agreed by all Australian Transport Ministers on 29 February 2008.

Repeal of the Road Transport Charges Act and parts of the Heavy Vehicles Registration Act will allow the implementation of new national heavy vehicle charges in accordance with section 14.5 of the Inter-Governmental Agreement for Regulatory and Operational Reform in Road, Rail and Intermodal Transport entered into between the Commonwealth of Australia, the States and Territories. Failure to repeal these provisions would prevent the Government of the Australian Capital Territory enacting its own heavy vehicle registration charges.

The Bill also implements a new road user charge rate of 21 cents per litre from 1 January 2009 - an increase of 1.367 cents per litre from the current rate determined by the then Acting Minister for Transport and Regional Services, the Hon Jim Lloyd MP on 28 June 2006. In addition to setting the new rate of the road user charge, the Bill also establishes a regulatory mechanism to allow adjustment of the road user charge to ensure that, over time, heavy vehicles continue to pay their fair share of road construction and maintenance costs and no more.

In undertaking the 2007 Heavy Vehicle Charges Determination, the National Transport Commission determined that the current rate of the road user charge of 19.633 cents per litre was insufficient to recover the damage that heavy vehicles cause to roads. If not addressed, the under recovery of heavy vehicle charges provides a strong disincentive for states and territories to allow wider access to their road networks for high productivity vehicles, resulting in more trucks on roads and a consequential erosion of safety outcomes. In addition, any continued under recovery of heavy vehicle road construction and maintenance expenditure must be met by taxpayers.

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