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Bills Digest No. 191 1997-98
Interstate Road Transport Amendment Bill 1998

WARNING:
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 consulted to determine the subsequent official status of the Bill.

Date Introduced: 2 April 1998

House: House of Representatives

Portfolio: Transport and Regional Development

Commencement: On Royal Assent.

To amend the Interstate Road Transport Act 1985 (the Principal Act), following the granting of self-government to the ACT, to cause the ACT to be treated on equal terms with other States under the legislation. The amendments would provide the ACT with the power to appoint its own enforcement officers, since the Commonwealth can no longer do this in the self-governing Territory. The Bill also amends the Principal Act to convert the existing monetary penalties to equivalent penalty units and inserts appropriate references to provisions of the Crimes Act 1914.

The application of cost recovery policies to the interstate road freight industry has been a complex issue. In the landmark Hughes and Vale (No. 2) decision in 1955, the High Court found that the only charge which could be levied upon interstate operators had to be related to wear and tear on roads caused by such operators.(1) Any higher charge imposed by a State would be seen as a restraint of free interstate trade and commerce and thus be in contravention of s.92 of the Constitution. Various States thus imposed so-called road maintenance charges, at a reasonably low rate, on heavy vehicles, including interstate carriers. Following a major truck blockade in 1979, these charges were subsequently abolished.(2)

In 1985, the Commonwealth established the Federal Interstate Registration Scheme (FIRS) under the Interstate Road Transport Act 1985. This Scheme had two main objectives. Firstly, the Scheme enabled the Commonwealth to impose a uniform Federal interstate registration charge which would not face constitutional obstacles, the proceeds of which would be refunded to the States to assist with road cost recovery. This charge is imposed by the Interstate Road Transport Charge Act 1985. Secondly, the Scheme enabled the Commonwealth to regulate aspects of the road transport industry when agreement with the States could not be reached on particular issues.

Several examples of such regulation can be quoted. Following the Review of Road Vehicle Limits in 1984, the Commonwealth argued that certain efficiencies could be achieved by raising the gross vehicle mass (GVM) limit to 42.5 tonnes before a vehicle would require a permit to operate. Since a number of States disagreed with this position, the Commonwealth allowed FIRS registered vehicles to operate up to 42.5 tonnes GVM free of permits. In the case of FIRS registered B-doubles (large articulated vehicles with a GVM of up to 60 tonnes) the Commonwealth granted permits for such vehicles to operate on designated routes.

A significant number of operators chose to register their vehicles under FIRS rather than State registries to gain the advantage of higher GVM limits. Furthermore, the Commonwealth, unlike the States, does not impose stamp duty on its vehicle registrations. However, the States and Territories administer the Scheme on behalf of the Commonwealth. As mentioned previously, funds raised from FIRS registration fees are not retained by the Commonwealth but are refunded to the States. It is estimated that, in 1997-98, around $15.3 million will be refunded.

The importance of FIRS is declining somewhat. The 1988 decision of the High Court in the matter of Cole v Whitfield had implications for road cost recovery.(3) The Court ruled that an action by a State would not contravene s.92 of the Constitution if that action did not discriminate between interstate and intrastate trade and commerce. This has left the way open for the States to impose their own road user charges on vehicles (including interstate carriers). Furthermore, the States and the Commonwealth have moved, by mutual agreement, towards more nationally uniform charges and regulations. In this environment, one of the few benefits to an owner of registering a vehicle under FIRS is simply the avoidance of State stamp duty.

It might be argued that the existence of FIRS simply adds another layer onto the fabric of State and Territory vehicle charging and regulation. Where the Commonwealth and the States agree to new regulations (traffic fine structures, registration charges, etc), consequential amendments to the Principal Acts must be passed by the Federal Parliament. The problem of Commonwealth-State co-ordination is illustrated by the current Bill Following the granting of self government to the ACT, the Commonwealth can no longer appoint enforcement officers in the ACT. This Bill ensures that the word 'State' encompasses the ACT and thus permits that Territory to appoint inspectors.

Item 3 of the Schedule to the Bill amends sub-section 3(1) of the Principal Act to include the Australian Capital Territory in the definition of a 'State'.

Items 4, 6, 7, 10, 12, 18, 19, 22, 23, 24, 25, 34 and 37 amend the Principal Act as a consequence of the inclusion of the Australian Capital Territory in the definition of a 'State'. These items remove specific references to the Australian Capital Territory from the legislation.

Item 1 inserts into subsection 3(1) of the Principal Act a new definition of the term 'carriage of passengers or goods between prescribed places' to mean interstate carriage, including the carriage of passengers or goods between a State and the Australian Capital Territory.

Items 13, 15, 16, 20, 21, 26 to 33 and 38 to 41 revise the way in which the legislation specifies fines and penalties.

The Federal Interstate Registration Scheme has played an important role in the achievement of more rational cost recovery in the interstate road freight industry and has been instrumental in bringing about nationally uniform regulations. However, the significance and rationale of the Scheme would appear to have diminished somewhat in recent years.

1. (1955) 93 CLR 127.
2. However, a number of States responded to the abolition of road maintenance charges by imposing fuel franchise fees.
3. (1988) 165 CLR 360.

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ISSN 1328-8091
© Commonwealth of Australia 1998

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Published by the Department of the Parliamentary Library, 1998.

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