Transporting New Zealand says a Ministry of Transport proposal to set congestion charges for trucks at four times the rate of cars will increase costs for businesses and consumers, while being out of step with comparable overseas schemes.
Under the proposal, a base time-of-use charge of $4.50 for a car entering a charging area would see motorcycles charged $2.25 and trucks $18. Charges could apply each time a vehicle enters, exits or travels within a charging zone during operating hours, subject to any caps.
Transporting New Zealand head of policy and advocacy Billy Clemens says the proposed ratio is unlikely to reduce congestion while placing additional pressure on freight operators.
“This proposal applies a higher relative charge to freight than most time-of-use schemes internationally. In cities such as Stockholm, London, and Gothenburg, vehicles are charged at a flat rate. Even schemes that do set different charges in Singapore and New York City set their ratios considerably lower than this Ministry of Transport proposal,” Clemens says.
“We would expect any price settings to reflect whether travel demand can realistically move off-peak, rather than relying on a simple multiplier based on vehicle type.”
Clemens says available data shows freight operators already avoid peak travel where possible due to the high cost of running truck fleets.
“Auckland traffic data shows that heavy vehicles largely avoid peak periods (6-9am and 4-7pm). Where trucks are operating in congestion, this is driven by customer constraints,” he says.
“For example, freight movements are tied to fixed shipping windows, freighting perishable or time sensitive cargo, or the times at which businesses are staffed to safely load and unload goods. These constraints limit the ability to shift demand in response to pricing signals.”
He says the proposed charging ratio appears excessive.
“Setting a quadruple charging ratio for large freight vehicles seems very high and appears like less of a demand-shift measure and more of a cash-grab that will ultimately be met by freight customers and consumers,” Clemens says.
“At this level, any travel time savings achieved through reduced congestion are likely to be offset by the additional charges faced by freight operators. Those costs are then passed through the supply chain.”
Clemens says similar outcomes have been seen where variable access charges have been introduced at ports, including in Auckland and Tauranga, with costs ultimately passed on to customers.
“At a time where increased transport costs are driving inflation up, we would expect Ministry of Transport to be carefully considering freight cost implications of their proposals. Particularly as the road freight industry has raised these concerns previously,” he says.
Transporting New Zealand says it will push for heavy vehicle charges to be capped at no more than twice the rate of other vehicles, in line with its submission on time-of-use charging legislation.
