ROAD TRAFFIC (MISCELLANEOUS) AMENDMENT BILL

Final Stages

Consideration in committee of the House of Assembly’s message.

The Hon. G.E. GAGO: I move:

That the council do not insist on its amendment.

This bill originated in another place. The amendment proposed here by the Liberal Party and passed on 18 June 2009 was disagreed to in the other place. The amendment proposes to remove the IAP regulation-making power from the bill.

I addressed the issues raised during debate on the bill in this chamber in July 2009. IAPs are now operational in New South Wales, Victoria and Queensland. Many freight companies and industry bodies support the legislation to enable the introduction of the IAP program in South Australia, but the government acknowledges that there is some opposition to IAP. That is why it will be a voluntary scheme, and it will not be required for existing access.

It is a commercial decision for every operator as to whether the benefits and participation in the scheme outweigh the costs and whether or not a freight company wants IAP. If the legislation is not passed then no freight operator from interstate or within South Australia will have the option of using IAP in South Australia. The government will also be denied a tool to manage road safety and to protect state and council road infrastructure. It is not in the interests of South Australia to insist on the council's amendment to remove IAP from this legislation and I urge members to support the motion.

The Hon. D.W. RIDGWAY: I rise on behalf of the opposition to indicate that we will be opposing the government's motion and insisting on our amendment. There has been long debate about this since we last dealt with the matter. In particular, I think the minister referred to some support for this nationally.

Members will be aware that the minister's office advised the Victorian Transport Association to provide us with some information in relation to it supporting that position. However, it is interesting to note that every other transport body in the nation has contacted my office and given me written advice that they support the position that the Legislative Council took, and that was to remove the IAP from this particular set of amendments.

I think it is rather a shame and an indictment on the government that it has held onto this for some time. We were happy to deal with it several weeks ago—in fact, before the winter break—to allow the speed reforms to go ahead and to allow the trucking industry to sit down with the minister and the minister's advisers for some discussion.

The minister is now saying that this is a voluntary scheme, it will not be retrospective and it will deny other operators the right to use IAP in South Australia if we stick to our amendments. Clearly, we are operating properly now. There do not seem to be any road safety benefits from this particular amendment. Shortly, when I read some of the dozens of letters that I have received about this, members will become aware that this is not something that is operating accurately in any other state. The minister says it is part of a national framework, and yet none of the other states have embraced it at this point.

I was unaware that this would be debated as the very first item today because it was No. 2 or 3 on the list and, clearly, it is not a government priority. I have a couple of letters that I would like to read onto the record. I am aware that the minister's office has contacted the Road Transport Association and expressed disappointment that the association has briefed the opposition. I would have thought that is what democracy is about: that everybody is entitled to speak to the opposition and keep it informed of all developments. Clearly, I am disappointed to think that the minister has instructed his officers to complain about the fact that we have been lobbied. The first letter I wish to read was written by the South Australian Road Transport Association to the minister on 9 September 2009. It states:

Dear Minister,

SARTA, whilst not opposed in principle to the concept of IAP, remains opposed to the current proposal to implement IAP in South Australia because:

1. The technology is not yet in place to deliver effective mass monitoring and vehicle configuration monitoring and, hence, IAP cannot deliver the stated infrastructure protection aims.

Remember that the minister just said that it will protect the roads. The letter continues:

2. The implementation costs are far higher than claimed by the government, and the industry cannot bear these costs, especially as there would not be any offsetting business gain that might otherwise warrant the costs. A typical mid-ranged truck operator would incur costs of over $300,000 to implement IAP and they would have to grow their revenue base by some $9 million to break even—this hardworking industry had the slimmest profit margins, just 3 per cent.

3. The community, including weekly household shoppers and the businesses and industries that we serve and underpin, would have to bear the costs that we would be forced to pass on without any tangible road safety infrastructure protection gain.

4. The IAP proposal is seemingly being driven with the aim of establishing an ongoing revenue stream through using it principally as an enforcement tool that would impose an absurd level of technical enforcement in relation to purely technical and very minor breaches, such as a truck driver having a 14½ minute rest instead of the required 15 minute rest.

5. IAP is ultimately aimed at the imposition of a new taxes and charges regime on the trucking industry that would again lead to significantly increased costs on the community and the economy without any assurance that revenue would be turned back into the road network.

6. The increased costs can be expected, without question, to impact adversely on price-sensitive exports, such as grain and wine, where just a few cents per tonne makes the difference.

7. SARTA does not accept the argument that there would be any net gain in safety or compliance through the imposition of this hugely expensive and essentially unnecessary tool in its current form.

8. The proponents of the IAP concept are still no closer to overcoming its greatest weaknesses—their inability to prevent and effectively counter that minority of truck operators who may choose to circumvent the system so as to gain a commercial advantage whilst the vast law-abiding majority would pay a hugely expensive price merely to prove that they are law-abiding.

9. Whilst the government has commented that the IAP would not be applied retrospectively and that it would only be applied on a voluntary basis in relation to genuine and significant new benefits and access, it has rejected SARTA's calls to enshrine those conditions in the law and as such the industry is being asked to accept what amounts to a promise. We do not think that this is reasonable as the government's refusal to legislate these conditions gives us serious cause for doubting the government's intentions.

Accordingly, we do not support the SA government's proposed amendments of IAP in South Australia and will not consider doing so until the government addresses the issues set out above.

As can be seen, that letter raises some significant concerns. I will just mention the companies that have written to me which are, if you like, undersigned to that particular proposal. They are: Total Logistics of Dudley Park, South Australia; Whiteline Transport, an interstate express service; Harris Refrigerated Transport; South Australian Crane Association Incorporated; the Owner Drivers Association of South Australia; Brown's Transport of Lameroo; Bordertown Haulage (the Karger family in Bordertown); Associated Hemmings Pty Ltd (Kevin Hemmings), a transport company in Mount Gambier; Allisons Transport in Plympton; Allied Pickfords; AG Wilson Earthmovers; Dennis Transport; Linke Contracting; KC & MR Boult; and K&S Freighters—I think that is an interesting letter. I will actually read the K&S Freighters letter into the record in a minute. Hi-Trans Express supports SARTA's position. Glen Carron of Beachport also supports its position.

Gilberts Transport Service and Gericke Bulk Handling support SARTA's position, as also do the following companies: Transport Services, Diamond Brothers, Lochert Transport, Quinn Transport, Paterson Bulk Transport (and I declare that Mr Norm Paterson is a member of the Liberal Party, and recently received a Medal of the Order of Australia for his contribution to the community), Ortlepp Transport, Northline Transport, Australian Road Train Association Links, Mid North Bulk Super Service, Macklin Transport and McArdle Transport. That is the end of the list, but I have a couple of letters that I would like to read.

So, members in the chamber can see that the Road Transport Association has a large degree of scepticism that the government is not willing to enshrine its promises in legislation. I think all members have seen in this place that the government has said one thing and done another. In fact, that is one of the hallmarks of this government: it continually says one thing and does another. This letter is from the Australian Transport Association of New South Wales and states:

ATANSW is aware that the SA government's proposed IAP legislation and the debate that it has attracted in the state parliament is opposed by SARTA.

ATANSW acknowledges that SARTA's position has been adopted in the best interest of the SA trucking industry and the SA economy.

We note that technology is not in place to deliver effective mass and vehicle configuration monitoring. The implementation costs are far greater than claimed and industry simply cannot [afford to bear this cost]...

IAP is an imposition of a new tax and charges regime on our industry and would again lead to significantly higher costs on the overall economy without any assurances that the revenue would be returned back into the road network.

ATANSW [agrees] supports the SARTA position that does not accept the argument that there would be any net gain in safety or compliance through the imposition of this hugely expensive and essentially unnecessary tool in its current form.

ATANSW would urge the SA government to work closely with SARTA in achieving the best possible outcome for the...road safety industry.

I think it is interesting for honourable members to note that the interstate bodies have urged the government and the Road Transport Association to work closely together. Clearly, there has been no willingness to do that on the part of the government.

There is also a letter from the Civil Contractors Federation. I think in the debate some weeks ago minister Gago indicated that the civil contractors supported the IAP, and I will quote from this letter written to Mr Conlon, as follows:

There has been some confusion within DTEI regarding the Civil Contractors Federation SA Branch's...position on the introduction of IAP in South Australia. This has been despite several meetings directly with DTEI staff and clear communication by the CCF SA at the Heavy Vehicle Forum in July 2009.

The Civil Contractors Federation...are opposed to the introduction of IAP in South Australia.

I will also read a letter which I think is quite interesting from Gericke Bulk Handling to Steve Shearer, the CEO of the Road Transport Association. It says:

Dear Steve,

The issue of IAP becoming compulsory for operating at higher mass is growing quite frustrating. Just in costs alone implementing IAP is beyond comprehension at this time. We look at all avenues to keep our costs down, thus being able to keep our customers happy; we take a great deal of pride in being able to provide a specialised service, with attention to every detail and quality taken very seriously by our company. Basically being forced to move into IAP we would have to pass the cost onto our customers. We have a hard enough time trying to get a rate increase as it is, without trying to get a rate increase for something that is not necessary.

Maybe the government should look at upgrading the roads in South Australia to higher mass standards, then IAP would not be required. All IAP is going to achieve is the enforcement agencies are going to be able to monitor the companies who are doing the right thing. There will still be the rabbits out there that will cut corners and breach the rules just like they do now!

There is one thing that my dad taught me when I first started work. You don't make money by sitting on your bum. You have to get out and get your hands dirty. What I am trying to say is that monitoring IAP from an office is not going to gain anything. They would still have to get out and perform random checks. A costly fine for being 30 seconds short for a rest break [is] just ridiculous. Obviously the government wants to cut corners by not having to get out and enforce the road laws, just sit in their air conditioned office [and] enforce the laws from there. We agree that IAP as proposed will not achieve higher safety or compliance outcomes because it cannot do what is being claimed. So the increased cost would add a burden to our economy for no gain.

Yours sincerely

Matthew Gericke

I refer to a letter from K&S Freighters to minister Conlon. K&S Freighters is part of the Scott group in Mount Gambier, as I am sure you are aware, Mr Chairman. Although, sadly, with the passing of Mr Alan Scott, the company may have changed somewhat in structure. The letter states:

Dear Minister Conlon

K&S Freighters Pty Ltd has been actively involved with Road Authorities and other parties within the supply chain on the development and introduction of model legislation in respect to Compliance and Enforcement. As you know, these new laws shift the onus of transport related matters on all those within 'the chain of responsibility' and not just the driver and/or operator, ensuring that any party who has control in a transport operation can be held responsible and made legally liable for transport related incidents.

Extensive work by the NTC with varying parties has resulted in the approval of the National Road Transport Reform (C&E) Bill by the ATC—November 2003.

As you are aware, the C&E legislation forms part of a broader package of measures focusing on improving compliance outcomes for road safety, infrastructure and the environment, while minimising the adverse impacts of road transport on the community.

Reform packages have been developed and introduced for mass, dimension and load restraint. Last year State Governments introduced the second major reform package—Heavy Vehicle Driver Fatigue. The Industry has experienced a significant degree of difficulty in the implementation of these packages due to a number of states (not necessarily South Australia) who have departed in varying degrees from the NTC model legislation. Implementation has been difficult and costs have been greater as a result and overall compliance has been harder to maintain as a result of all these variations.

We write to you as Minister for Transport—South Australia, with our concern over the next reform package to be introduced in South Australia—Speed, and the combining of this reform package with other matters, namely IAP (Intelligent Access Program). The reform packages to date have been significant for the Industry and others within the supply chain. To add additional burdens and complexity by combining other items to this reform departs from the original intent of the model legislation/packages and will cause greater confusion in respect to interpretation and/or implementation difficulties including costs.

In relation to IAP, our experience to date in other states has been that the costs associated with fitting and maintaining IAP compliant monitoring devices on vehicles have not justified any efficiency gains available from new routes and access regimes. We are very concerned to ensure that the introduction of IAP as a pre-condition of making new route and access regimes available to transport operators be subject to proper cost-benefit disciplines so that one of the fundamental outcomes of IAP (i.e., productivity gains) is achieved.

We also take this opportunity to record our concern that IAP not be introduced retrospectively to existing route and access regimes used by transport operators. To do so would be to impose significant additional costs upon transport operators in circumstances where they may be precluded contractually from recovering these increased costs from their customers. We believe that this would be unfair and unintended consequences of the introduction of IAP.

We seek that the South Australian Government continues to introduce and implement the transport reform packages as stand alone units, as we have in the past. We also ask that you take into account our concerns in relation to IAP, regardless of whether speed and IAP reforms are progressed as stand alone units or as a package.

Yours sincerely

Legh Winser

Members can see that there is a depth of understanding and feeling. I hope members in this chamber understand that the industry is very concerned with a government that makes a promise that it will be a voluntary program, or why would these 50 or so companies write to me and send so many letters to the minister if they genuinely believed that this would be a voluntary program?

Minister Gago should put on the record the reasons that the government will not enshrine in the legislation the commitment it has made that this is voluntary. Clearly, the Road Transport Association nationally supports IAP in principle. It is very concerned about the impost on its operations. Given the global financial times we are facing—and I suspect we are not out of the woods by any stretch of the imagination—imposts on small businesses will be significant. A figure of $300,000 has been quoted to implement the IAP for mid-range operators.

Members can also pick up from the tone of the letters I have received that there is a level of concern about where this might lead in relation to new taxes and charges. That raises another issue about openness and transparency in what the government is trying to achieve. The opposition—as is the industry—is still more than happy to support the speed reform but, clearly, in relation to the IAP a lot of questions are unanswered.

Clearly, the industry is concerned. It has dealt with the government for some 7½ years and, obviously, it has some experience with commitments, which have been given off the record or which have not been enshrined in legislation, failing to materialise. I would like the minister to explain to the chamber why the government cannot sit down with the industry and come up with a legislative package that gives the industry the comfort for which they have asked.

The Hon. G.E. GAGO: Many of the issues that the honourable member has raised have been dealt with already during the second reading summary and/or the committee stage. I accept that there are those who do not agree with us and do not support the scheme but, nevertheless, we have addressed already in depth many of those issues. It is not in anyone's interest to keep repeating the same responses so I will endeavour not to do that.

In terms of those fairly new matters that the honourable member has raised, there are some who do support the introduction of IAP. SATAR clearly does not support this, but I cannot stress strongly enough that the scheme is voluntary. It is a voluntary scheme which will not be required for existing access. It will be a commercial decision for every operator as to whether the benefits of participating in the scheme outweigh the costs.

Before going onto the reasons why we do not believe it is a good idea to enshrine it in legislation, the honourable member mentioned the Victorian Transport Association. That association has written to the Minister for Transport to express support for the IAP and its introduction in South Australia. The VTA has over 800 members, including many freight companies operating from and in South Australia.

Some of those organisations that do support what we are doing include: Roads Australia with 67 members, including major construction, engineering, paving and road operating companies in Australia, together with industry peak bodies and unions.

The Hon. D.W. Ridgway interjecting:

The Hon. G.E. GAGO: Truly, how does the honourable member think they transport their goods in order to conduct their business?

The CHAIRMAN: Order! The honourable member should ignore interjections.

The Hon. G.E. GAGO: Indeed, I will take your advice, sir, and ignore the ignorance of the honourable member opposite. Infrastructure Partnerships Australia, which is another organisation that supports this legislation, is a peak infrastructure forum comprising public and private representation which advocates the public policy interests of the infrastructure industry. The Australian Logistics Council is a partnership of senior industry leaders, including customers, transport providers, peak bodies, state-based freight councils and other industry specialists, with the aim of advocating on behalf of the transport and logistics freight industry. NatRoad, Australia's largest trucking association, representing all long-distance and regionally based operators, is another organisation supporting it. While originally having reservations about the bill, NatRoad now supports it, based on further information provided to it. Also supporting the bill is the Noske Group, a freight company which has significant operations developing in the Green Triangle region and which already has vehicles enrolled in the IAP system in both New South Wales and Queensland. It believes that a national IAP system offers fully compliant companies the opportunity to maximise the benefits of heavy mass limits without incurring further increases in non-productive administrative overheads. There are others, but I think I have mentioned some important ones.

I would like to put on record that many of the letters of support that the Hon. David Ridgway quoted are a result of the pro forma letter that SARTA sent out to its members—in fact, most of them are from SARTA members. Of course, it is their prerogative to write letters, but I remind honourable members that it is a voluntary scheme.

In terms of why we feel it is unnecessary to enshrine this policy in legislation—and we have certainly put this on the record often enough—we believe it would compromise the minister's powers to approve access under the provisions of the Road Traffic Act and would reduce flexibility for existing operators. For example, it would prevent IAP being made available to operators on South Australian higher mass limit routes who are enrolled in IAP for higher mass limits in New South Wales and Queensland. These operators may wish to operate under IAP to avoid filling in and carrying the route compliance certificate currently required in South Australia as a higher mass limits condition. No other jurisdiction has included restrictions like this in its IAP legislation and, as I put on record before, IAP is now operational in New South Wales, Victoria and Queensland.

Another reason for not enshrining it in legislation is that the policy on heavy vehicles access is set according to the principles of the DTEI heavy vehicles access framework, and this is sufficient to guide application of the IAP. The framework was developed in consultation with the transport industry and approved by the Minister for Transport, and changes to policy are not undertaken without consultation with the industry and distribution of information about the changes. DTEI is very aware about the potential impact of changes to transport operations.

If IAP was applied only where the minister was satisfied that the operational benefits justified the requirement for IAP, the minister would have to assess each individual application and grant individual permits. It would force an operator who wanted access, subject to IAP, to provide a cost benefit analysis to satisfy the minister that the benefits justified imposing IAP. It would add red tape, time and cost for both government and operators, and it would prevent operators registered in IAP schemes in other states from using IAP monitoring in South Australia without satisfying the minister that the benefits justified imposing it. Finally, it would restrict the availability of new access—for example, where IAP is required for legitimate road safety or infrastructure protection reasons but there is not an operational benefit for that particular access.

The Hon. A. BRESSINGTON: I rise to indicate that I will support the government on this particular motion. I would like to put on the record that I have consulted with some of the crossbenchers and, in regard to the letters that the Hon. David Ridgway read out and put on record, none of us has been lobbied by those people; none of us has received those letters, or pleas from those particular people, to support the Liberal Party in its efforts. I find that a little curious, given that when there is a contentious issue we are probably lobbied as much as anyone else in this place. I would also like to put on the record that we do have copies of the letters to which the minister referred.

At the end of the day there will always be someone who does not want it and someone who does. However, the feeling that I get is that the people who are involved in trade and the business of transport and infrastructure nationally see a benefit in this.

There is one question that I would like to ask the minister. Can the minister give us an outline of what inconveniences would be imposed on the industry itself (transport and that sort of thing) if South Australia does not implement the IAP?

The Hon. G.E. GAGO: There are a number of inconveniences, but probably two of the most obvious are the fact that, if we do not have this system in place where business operators could opt in, South Australian operators registered in states such as New South Wales, Queensland and Victoria, where they travel interstate, would be required to be registered in the IAP systems that are available in those states and would have to have a separate lot of compliance documents registered here in South Australia rather than having just one system for the nation; and, conversely, those companies that are registered in other states that travel to South Australia would be required to be registered under two separate systems. Surely, it is just commonsense to put in place a system that eventually could be rolled out right around Australia and make it easier for this sector, in particular.

The Hon. D.G.E. HOOD: The position of Family First remains unchanged, that is, we will insist on the amendment. The reason for that was largely outlined by the Hon. Mr Ridgway. Like he, we too have had extensive lobbying from multiple organisations that have written to us strongly urging that we maintain our position, that is, to oppose the introduction of the IAP as proposed by the government.

We are happy to listen to the concerns of those constituents. After all, they are the people on the front line in this situation and who would know better than they whether this will positively or negatively impact their industry? We are not above taking the advice of these people. In fact, I have spoken to a number of them individually and for that reason we will maintain our position.

I would just like to address one issue which, as far as I heard, the Hon. Mr Ridgway did not address, because most of what I planned to say he did address, including listing the letters that he has. We, too, have letters from the same organisations and, indeed, maybe a couple that he does not have, as far as I can tell.

With respect to the issue raised by the minister regarding the Victorian Transport Association's position on this matter, we have some concerns about that because it has been suggested to us—and we are reliably informed—that the IAP applies only to cranes in Victoria. On a number of occasions, the VTA has consistently criticised the IAP, as have many areas of the industry nationally. It seems to me from my discussions with these individuals that there are a number of members of the VTA (both large and small) within Victoria itself, that are openly rebelling against the VTA's position with respect to their latest communication to the South Australian government on this issue.

So, I think there is clearly enough concern from the people who will be affected by this the most for us to credibly hold our position, and that is our intention.

The Hon. G.E. GAGO: I have been advised that, in relation to the VTA, the Hon. Dennis Hood is correct when he says that it does apply only to cranes, but the VTA intends to expand that. In a recent announcement by the Victorian minister, the Hon. Tim Pallas, regarding the introduction of the next generation high productivity freight vehicle trial, he said that he welcomed the trial and that it would be undertaken with the use of IAP technology. Mr Pallas launched the trial guidelines on 11 September 2009, and it will see the trial run for two years. The trial allows B-double vehicles, capable of carrying large containers, to move goods and such like. So, the VTA is looking at a trial, with a mind to extending it.

The Hon. D.W. RIDGWAY: When the Legislative Council amended this bill, the industry bodies made it very clear that they wanted to sit down with the minister and departmental officials to see whether there was some sort of common ground. They have clearly articulated that they support in principle the IAP. I would like to know why the government is not prepared to support the speed reforms, as we are doing today, and make sure that is implemented and then go back and look at the IAP in some detail with the industry. Clearly, that would be a sensible thing to do.

I say to the cross-benches that we, like the industry bodies, support in principle the IAP. Given that industry bodies have given in principle support to the IAP, surely there should be an opportunity for them to all sit down to try to work out a solution and not have it forced upon them. I say to those on the cross-benches that, time and again, we have seen the government make commitments on a whole range of things and not deliver. I think that is why this industry is so concerned; that is, that by the end of today this legislation will be imposed upon the industry, and that they have no level of confidence that what the minister has said will actually be delivered.

I know that the minister has carriage of this bill in this chamber, but I would like to know why minister Conlon is not prepared to sit down with the people who are here today, as well as those in the gallery who advise him, to work out a solution. Clearly, that seems to be the logical way in which to go forward, given that the government already has in principle support for IAP. I really think the cross-benches should know why you are not prepared to sit down and work with them.

The Hon. G.E. GAGO: In fact, the government is prepared to sit down to discuss this matter. A heavy vehicle industry forum was held in June and July this year, which forum included representatives from SARTA and a number of chief executives and other appropriate agency representatives. There has been considerable opportunity to have input into this matter. However, the bottom line is that this is a voluntary scheme, and that is the ultimate compromise, I guess. No-one will be forced to implement this. I have outlined in detail in this place why it is not advisable to implement that in legislation. We have given a commitment—the commitment is well and truly on the record—and it is time to move on.

The committee divided on the motion:

Majority of 1 for the ayes.

Motion thus carried.