Bills Digest no. 88 2007–08
Interstate Road Transport Charge Amendment Bill
This Digest was prepared for debate. It reflects the legislation as
introduced and does not canvass subsequent amendments. This Digest
does not have any official legal status. Other sources should be
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Interstate Road Transport Charge Amendment
House: House of Representatives
Portfolio: Infrastructure, Transport, Regional
Development and Local Government
1 July 2008
relevant links to the Bill, Explanatory Memorandum and second
reading speech can be accessed via BillsNet, which is at http://www.aph.gov.au/bills/.
When Bills have been passed they can be found at ComLaw, which is
To amend the Interstate Road
Transport Charge Act 1985 (IRTCA) to increase the registration
charges for heavy vehicles registered under the Federal Interstate
Registration Scheme (FIRS).
The FIRS commenced in 1987 as an alternative to state based
registration for heavy vehicles weighing 4.5 tonnes and over.
The Scheme was designed to provide uniform charges and operating
conditions for heavy vehicles engaged solely in interstate
operations. A vehicle registered under FIRS may not be used for
intrastate work. This means that goods carried by a FIRS vehicle
must be in the process of being delivered to an interstate address
in a continuous journey.
Heavy vehicles pay registration charges
(which vary by truck type to capture varying axle-load damage) and
a diesel fuel excise. The National Transport Commission (NTC) makes
recommendations to Transport Ministers about, amongst other things,
the amounts they should charge to recover road expenditure
attributable to heavy vehicles.
Of total road spending Australia-wide of around $10.4 billion
(the annual average for the three years to 2004-05), heavy vehicles
were required to pay a little over $1.6 billion.
As it was unclear whether this might be too low, the former
Treasurer, the Hon. Peter Costello requested that the Productivity
Commission undertake a review of the economic costs of freight
infrastructure and efficient approaches to transport pricing.
The purpose of the review was to assist the Council of
Australian Governments (COAG) to implement efficient pricing of
road and rail freight infrastructure through consistent and
competitively neutral pricing regimes.
The review of heavy vehicle charges was endorsed in 2007 by the
COAG. The Minister
for Infrastructure, Transport, Regional Development and Local
Government, the Hon. Anthony Albanese, referring to the
Productivity Commission report
existing charges are insufficient and the heaviest
vehicles are not paying for the damage they cause while lighter
trucks are paying too much... The increase in the Road User Charge
will ensure all heavy vehicles types pay their fair share and will
have only a marginal impact on a vehicle s operating cost.
The bills digest for the Road Transport Charges (Australian
Capital Territory) Repeal Bill 2008 provides further information
about the repeal of the existing system of registration charges for
In his second reading speech to this Bill, the Minister stated
that a six-week consultation process on the draft Regulatory Impact
Statement (including the new Heavy Vehicle Charges Determination)
had been conducted and that the consultation with industry, trade
unions, state and territory governments, peak industry associations
and freight customers, had informed the final
According to the Explanatory Memorandum there is no net impact
on the Australian Government Budget flowing from the amendments in
the Bill. It states that all revenue from FIRS charges is returned
to the state and territory governments under an agreed distribution
formula that accounts for road usage by FIRS heavy
article in the Australian Financial Review shows that industry
bodies such as the Australian Trucking Association, have voiced
concerns over the flow-on effect that increased registration
charges might have to the costs of domestic freight goods, such as
The Bill amends the IRTCA to introduce a new system of
determining registration charges for certain heavy vehicles. It
does this by:
- repealing the current fees Schedule in the IRTCA
- deleting references to a repealed Act (the Road Transport
Charges (Australian Capital Territory) Act
1993) which set out the system for determining annual
- providing for Regulations to be made under the IRTCA, to set
the fees and annual adjustments for heavy vehicles.
The new system makes reference to the 2007 Heavy
Vehicle Charges Determination which was released in December 2007.
The Determination recommended a new set of registration charges
which re-assess the relative contribution of different heavy
vehicle classes. Consequently, the new charges will result in large
trucks, B-doubles and road trains, paying more in registration
charges, with the increases to be phased in over three years. It
was also recommended that the charges for smaller trucks be
Item 2 of Schedule 1 of the Bill
inserts proposed section 3A which contains
relevant vehicle definitions.
Item 3 of Schedule 1 of the
Bill repeals the existing subsection 4(1) of the IRTCA and inserts
proposed subsections 4(1) and 4(1A). These subsections impose the
charge on the registration of the vehicles listed and extend the
category of vehicles to include a number of new types of vehicles,
such as pig and dog trailers, converter and low loader dollies, and
some B-double trailers.
Item 6 of Schedule 1 of the Bill repeals the
current section 5 of the IRTCA, which provides the formula for
calculating the registration charges for the relevant vehicles. The
repealed section is replaced with a new section 5, which allows for
registration charges to be worked out in accordance with
regulations made for the purposes of the section. The Regulations
that provide the charges must reflect the national charges and
annual adjustment processes that are agreed by the Australian
Transport Council: subsection 5(4).
Item 7 of Schedule 1 of the Bill repeals
section 5A of the IRTCA, which provides for automatic increases of
registration fees in accordance with a determination under the
Road Transport Charges (Australian Capital
Territory) Act 1993. As this latter Act is being
repealed, the process for applying future annual adjustments will
be set out in Regulations under the IRTCA.
Item 12 provides that the amendments apply from
the financial year beginning 1 July, 2008. The Explanatory
Memorandum states that the date was agreed to by Australian
Transport Council Ministers.
18 March 2008
Bills Digest Service
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