John MacDonald: My one reservation about universal road charges

I bet if you drive a petrol vehicle and you’ve said anything about how much cheaper it must be to have a diesel, anyone who does have a diesel has jumped down your throat and started banging-on about road user charges. Or RUCs, as they’re known. 

Because when you buy petrol you pay a fuel tax. When you buy diesel, you don’t. But you have to —or you’re supposed to— pay road user charges.  

And, as we know, the EV drivers who have been getting away paying nothing are getting brought into the road user charge regime. 

So, while the diesel might be cheaper at the pump, it kind of all evens-out once you take the RUCs into account. That’s the thinking anyway. 

But the New Zealand Initiative think tank is saying today: “Wrong, it doesn’t even out at all”. They’re saying it’s actually very uneven. 

They’re saying today that we need to ditch the current road-user charging model because it's old-hat and isn't a fair way of getting the money needed to build and maintain roads.  

And they’re not just saying ‘stop doing what we’re doing’. They’ve also come up with an idea that they think would be fairer - which I agree with, to a point. And I’ll get to where I have reservations about it. 

So what the New Zealand Initiative wants to see is a system using things like smart technology to monitor vehicles and set individual charges for every vehicle owner based on the types of vehicles we drive, how far we drive and when we drive.  

It says a system like this would also make it easy to bring-in congestion charging, which it believes is also necessary to get traffic flowing more freely in our cities.  

So, essentially, what it's proposing is a different type of user-pays system to fund our roads instead of the petrol taxes and road user charges we currently have.  

It says it wouldn’t necessarily increase the revenue the Government gets from motorists, but it would spread the cost burden more evenly and fairly. 

Example: the impact of flat fuel taxes on people on low incomes. The NZ Initiative  makes the assumption that if you're on a low income, you tend to have a vehicle or vehicles that are less fuel efficient than something that’s rolled-of the production line this year. 

So you might not actually use the roads any more than the flash Harry with the new car. But you are penalised because your car’s less fuel efficient. 

So, generally, I get the thinking and I like the idea. But you’re not going to get me installing devices in my vehicles that keep a record of what I do with them.  

Call me paranoid, but I think there is enough monitoring going on. Find my iPhone, cameras everywhere. So, if this went ahead, I’d be saying ‘no thanks’ to the “smart” part of all this —the electronic monitoring— and I'd have to pay my road user charge ahead of time. Just like the system we have in place now. 

So, yes, I agree that the way we do it now is cack-handed and clumsy and we need to do things differently. 

And, yes, taxing people on the basis of road use instead of fuel consumption makes much more sense. 

But it’s a definite 'no' from me when it comes to installing more devices to keep tabs on what I'm up to. 

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Episode Transcript

Speaker 1 (00:06):
You're listening to the Canterbury Mornings podcast with John McDonald
from Newstalk z'b.

Speaker 2 (00:12):
I bet, I bet if you drive a petrol vehicle
and you've ever said anything about, oh, how much cheaper
it must be to have a diesel, anyone who does
have a diesel has jumped down your throat and started
banging on about road user charges or rucks as their own.
Because when you buy petrol, of course you pay a
fuel tax. When you buy diesel you don't, but you

(00:34):
have to or you're supposed to user charges. And as
we know the ev drivers too, they have been getting
away with paying nothing, but they're getting brought into this
whole road user charge regime as well. So while the
diesel might be cheap at the pump, it can't of
all evens out once you take the rucks into account.
Well that's the thinking anyway, But the big brains at

(00:55):
the New Zealand Initiative think tank have had a thought,
put some thought into it, and they're saying today wrong, wrong,
doesn't need out at all, does not even out at all.
They're saying it's actually very uneven and they're saying today
that we need to ditch the current road users charging
model because it's old hat and isn't a fair way

(01:18):
of getting the money needed to build and maintain roads.
And they're not just saying stop what we're doing. They've
come to us with a solution which they think would
be fairer, which I agree with to a point, and
I'll get to where I have major reservations about this
in a second. So what the New Zealand Initiative wants

(01:39):
to see is a system which would use things like
smart technology to monitor vehicles and set individual charges for
every vehicle owner based on the types of vehicles we drive,
how far we drive, and when we drive. It says
a system like this will also make it easier to
bring in and wait for it congestion charging, which it

(02:04):
believes is also necessary to get the traffic flow more
freely in places like christ Church. So essentially, what it's
proposing is a different type of user pays system to
fund our roads instead of petrol taxes and road user charges.
Here's how doctor Matthew Birchill from the New Zealand Initiative
seas it working.

Speaker 3 (02:19):
So road users would have two payment options, an automated
pay as you drive system using an in vehicle device
or pre purchase distance licenses like we already use for
our ruck. So it gives you flexibility for those who
who want the technology option that's there. But also I
feel more comfortable with the pre purchase distance license like

(02:42):
we already used for ruck. You can go for that
as well.

Speaker 2 (02:45):
So Matthew Burchell says this approach wouldn't necessarily increase the
revenue the government gets from motorists, but it would spread
the cost burden more evenly and fairly. So let's look
at an example that they're giving the impact of flat
fuel taxes on people on low incomes, that they're holding
these people up as a reason why change needed. The

(03:08):
think tank that made the assumption that if you're on
a low income, you tend to have a vehicle or
vehicles that are less fuel efficient than something that's rolled
off the production line this year makes sense, doesn't it.
So you might not actually use the roads anymore than
the flash harry up the road with the new car,
but you're penalized in a way because your car is

(03:30):
less fuel efficient. So generally I get the thinking and
I like the idea, But as I said before, there
is a butt I'll tell you what you are not
going to get me installing devices in my vehicles that
keep a record of what I do with them. You
might think, oh, here we go, here we go, first
world problems, sl ten paranoid. Well you can think that,

(03:53):
but I reckon there is enough monitoring going on. Then
I find my iPhone cameras everywhere. So if this went ahead,
what I would doing is I'd be saying no thanks
to the smart part of all this, the electronic monitoring,
And so I'd have to pay my road use the
charge ahead of time, just like the system we have
in place now. So yes, I agree that the way

(04:14):
we do it now is cack handed and clumsy. It's
not equitable, and I agree we do need to do
things differently. And yes, taxing people on the basis of
road use instead of fuel consumption makes much more sense,
makes perfect sense to me. But it's a definite no
from me when it comes to installing devices to keep
tabs on how I'm using my vehicles.

Speaker 1 (04:36):
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