Senate

Supplementary Explanatory Memorandum

Circulated by authority of the Minister for Infrastructure, Transport, Regional Development and Local Government the Honourable Anthony Albanese, MP

OUTLINE

The Road Charges Legislation Repeal and Amendment Bill 2008, as introduced, repeals the Road Transport Charges (Australian Capital Territory) Act 1993 and the parts of the Road Transport Reform (Heavy Vehicles Registration) Act 1997 which refer to the Road Transport Charges (Australian Capital Territory) Act. The Bill also amends the Fuel Tax Act 2006 to implement changes to the heavy vehicle road user charge necessary to give effect to revised heavy vehicle charges agreed by all Australian Transport Ministers on 29 February 2008.

These Senate amendments to the Bill remove the provision allowing the rate of road user charge to be automatically indexed. Instead, the proposed amendments will enable the Transport Minister to declare any changes in the rate of the road user charge by disallowable legislative instrument.

The proposed amendments will also require that the Transport Minister allow for public consultation of at least 60 days prior to declaring any increase in the rate of the road user charge. In seeking this public feedback, the Minister must also publish all data, methodologies and formulae used to arrive at the proposed increased rate of the road user charge.

Finally, the proposed amendments will require that the Transport Minister have regard to the outcomes of the public consultation process. However, if the Minister decides to declare an alternative rate of the road user charge as a result of the outcomes of the public consultation process, the Minister is not required to recommence the period of public consultation.

Financial impact statement

The removal of automatic indexation of the road user charge will increase Australian Government fuel tax credit expenses by $0.0 million in 2008-09, $40.0 million in 2009-10, $80.0 million in 2010-11, $140.0 million in 2011-12.

NOTES ON CLAUSES

Amendment 1

This amendment has the same effect as Item 1 in the Bill but simplifies the wording used. That is, the Fuel Tax Credit is now reduced by the amount of the road user charge (21 cents per litre unless determined by the Transport Minister) rather than the road user charge being only that determined by the Transport Minister.

Amendment 2

This amendment opposes Item 3 in the Bill which would have added a reference to the definition of 'road user charge'. This reference to a new definition is no longer required given Amendment 6 below.

Amendment 3

This amendment is a consequence of reverting the declaration of a rate of the road user charge back to a Ministerial determination as described in Amendment 6.

Amendment 4

This amendment is a consequence of removing the ability to automatically index the rate of the road user charge through a regulatory mechanism as described in Amendment 7.

Amendment 5

This amendment is a consequence of reverting the setting of the rate of the road user charge from a rate prescribed by regulation to a determination by the Transport Minister as described in Amendment 6.

Amendment 6

This amendment reverts the setting of the rate of the road user charge from a rate prescribed by regulation to a determination by the Transport Minister. Removing the ability to automatically index the rate by regulation allows reversion to a determination by the Minister. This determination would be a disallowable legislative instrument.

Amendment 7

This amendment replaces the ability to automatically index the rate of the road user charge through a regulatory mechanism with a provision that will allow the Transport Minister to determine a rate of the road user charge by disallowable legislative instrument.

A new subsection (9) is introduced which establishes two conditions that must be met before the Transport Minister can make a determination that would increase the rate of the road user charge. These conditions are:

a.

a period of at least 60 days public consultation during which time the Transport Minister must publish:

i.

the proposed rate of the road user charge; and

ii.

any information (i.e. data, methodologies or calculations) used in determining the proposed increase in the rate of the road user charge; and

b.

the Transport Minister must have regard to comments received during the period of public consultation.

A new subsection (10) provides that, should an alternative rate of the road user charge other than that originally proposed by the Transport Minister be identified or recommended as a result of comments received during the period of public consultation, the Minister can determine this alternative rate without having to undertake a new period of public consultation.

Amendment 8

This amendment is a consequence of reverting the setting of the rate of the road user charge from a regulation to a determination by the Transport Minister as described in Amendment 6. The definitions which were to be repealed in the Bill are now required.