An organisation representing the road freight transport industry is urging caution on the Government’s latest transport Bill, which proposes changes to how road tolls work in New Zealand.
Transport Minister Chris Bishop unveiled the Land Transport (Revenue) Amendment Bill yesterday, aimed at “taking the next step towards a fairer, simpler, and more modern transport funding system”.
Among the changes introduced in the bill was the enabling of “corridor tolling”, which would allow tolling on parts of an existing road where “users receive clear, demonstrable benefits from a new project in the same corridor”.
Transporting New Zealand chief executive Dom Kalasih said that while his organisation, which represents the road freight transport industry, could see how the change could bring forward raising revenue for new roads, it wanted to see some “constraints”.
“Existing roads have already been paid for by road users through petrol tax and diesel road user charges, for example, so if this approach were to progress, we’d like to see that other options, like PPPs (Public-Private Partnerships), have first been fully explored before tolling existing roads,” he said.
“We’d also need to have certainty that all the money that’s collected from roads is spent on roads.”
Another change in the bill was the introduction of new tolling tools, including the ability to restrict heavy vehicles from using unsuitable alternative routes – keeping them on tolled roads.
Kalasih was concerned that the change was “fundamentally denying transport operators and drivers freedom of choice”.
Transporting New Zealand did support other aspects of the Bill, however, particularly around changes to the road user charge (RUC) system.
The bill enables new payment models, such as subscriptions or post-payment, and allows companies to offer easy, set-and-forget billing options – similar to power or streaming services.
Bishop said it would “future-proof” the system to allow in-vehicle technology to record distance and would separate the New Zealand Transport Agency “from its retail role so third-party providers compete on a level playing field”.
He said it was the “first step towards replacing petrol tax with RUC for light petrol vehicles”.
Currently, road user charges apply to all diesel vehicles, heavy vehicles (over 3.5 tonnes), and light electric vehicles, including plug-in hybrids.
Kalasih said Transporting New Zealand supported these changes.
“These changes will enable greater use of technology and more flexible payment options, and also do away with the requirement to display a RUC label.
“This will help get our RUC system match-fit to enable tech businesses to offer low-cost products that could be rolled out to the petrol vehicle fleet in the future.”
The Taxpayers’ Union also commented on the proposed changes.
“Tolling and congestion charging to manage peak-time pressure and pay for new roads make sense when they’re fair and revenue-neutral. By any honest definition, that means cutting road user charges to offset the new costs facing commuters,” spokesperson James Ross said.
“International examples like Singapore show a light-touch system can keep traffic flowing without hammering households, and it makes tax relief through reduced RUCs realistic.
“If the Government wants taxpayers on side for these reforms, it needs to stay true to its current approach. Keep charges low, keep them revenue-neutral, and charge people only for the infrastructure they actually use. The moment corridor tolling charges drivers for roads they don’t use, it stops being user-pays.”
Following its first reading, the Bill will go before the Transport and Infrastructure Select Committee.
