Incremental pricing expensive, hard to implement: report


IAP should extend to incremental road pricing, but key problems in establishing pay-as-use system, report argues

Incremental pricing expensive, hard to implement: report
Incremental pricing expensive, hard to implement: report
By Brad Gardner

The Intelligent Access Program (IAP) should extend to incremental road pricing, according to a new report, which outlines major problems stifling moves towards a pay-as-use system.

The National Transport Commission (NTC) today released a report on a feasibility study into distance charging, recommending IAP the most effective option in measuring how far heavy vehicles travel.

Under an incremental price scheme, transport operators can carry more mass above national limits by paying road agencies or local councils for extra damaged caused to road infrastructure.

The report claims IAP is less costly than other approaches, "such as measuring the number of trips via self-reporting verified by transport documents", but will require "significant legislative changes to be applied for charging purposes".

But while claiming there is strong industry support to replace the current charging system, the NTC concedes there are barriers to establishing an effective new model.

It says the big drawback to a scheme lies in whether trucking operators will receive adequate access for their money.

The report says there is little knowledge of how roads perform under axle loads, with pavement engineers only recommending an extra 10 percent above current mass limits.

"This has the potential to constrain productivity gains and the attractiveness of the scheme to participants, especially if there is substantial entry or ongoing costs," the report says.

The NTC recommends more research on the impact of higher axle loads, and says bridges also represent a major impediment to operator productivity.

In its report, the NTC says government incremental price trials in Queensland, NSW, Victoria and South Australia show many bridges cannot support increased mass.

"In other cases, not enough information is known to make a reasonably quick and low-cost assessment of their capacity for extra mass," the report says.

The NTC says the problem with bridge capacity is also exacerbated by certain operators already overloading heavy vehicles.

"Therefore, allowing access to higher loads could result in severe distress for some bridges if transport operators overload above an even higher allowed mass limit," the government body says.

But in arguing for more work to be done on assessing bridges, the NTC laments the time taken to do so, saying it is costly, complex and requires certain engineering skills.

In order to resolve the issue, the report recommends assistance for governments performing assessments.

Other issues identified include how prices should be set, with the NTC proposing a variable rate or a fixed charge.

In order to determine costs, the NTC suggests "using forward looking costs or based on an average cost approach, such as the current case accounting approach".

"However, it must be emphasised that some of these methods are costly to implement and will require some further research and analysis," the report says.

The NTC recommends using the Performance Based Standards (PBS) scheme as an entry safety assessment process, but says the PBS Review Panel may struggle to efficiently and effectively handle large numbers of applications.

The states will need to buck recent history if the scheme is to be established, with the report saying there must be nationally consistent outcomes combined with efficiency and simplicity.

Industry groups have in the past criticised the states for adapting reforms intended to be nationally consistent, such as fatigue management laws.

But NTC Acting Chief Executive Meena Naidu says distance charging has the potential to increase industry productivity by reducing the number of trucks on the road.

"It could also help target infrastructure investment to fix ‘last mile’ bottlenecks, which strangle productivity," Naidu says.

Incremental pricing is a part of the Council of Australian Governments (COAG) reform agenda, which will determine whether to go ahead with the scheme.

If COAG calls for more work to be done, the NTC says the next step will involve developing a regulatory impact statement by late 2009.

The NTC is seeking public comment on the feasibility study until February 27.

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