Road user charges: AA backs shake-up but wants low admin costs
RNZ
Private companies will need to keep the costs of running the government's new road user charges scheme as low as possible, the AA says.
The government is inching closer to replacing petrol tax with electronic road user charges on all light vehicles, in what Transport Minister Chris Bishop calls [https://www.rnz.co.nz/news/political/569149/road-user-charges-for-all-vehicles-move-a-step-closer
the biggest shake-up of road funding in half a century].
He says it'll be fairer and will be like paying a power bill or Netflix each month and will be in place by 2027.
The changes will put an end to the existing two-tier system, where petrol users pay a fuel excise duty of about 70 cents a litre at the pump, while diesel, electric and heavy vehicles pay paper-based road user charges based on distance travelled.
However, Labour says the timing of the coalition's transition to a universal road user charges system risks "clobbering" motorists with more costs.
AA's policy director Martin Glynn said his organisation is also worried about how much motorists would have to pay under the new scheme.
He told
Morning Report
he was unsure if it would be more expensive.
At present the minimum road user charge kicked in once a light vehicle had travelled 1000km.
That was $76 and $12-$13 for an administration fee.
With private providers being brought in to run the revised scheme they would need to be making money, Glynn said.
"We really want to see the administration costs be as low as possible."
He agreed with the Minister that with more vehicles becoming more fuel efficient, the current petrol tax penalised those with older vehicles.
"It's become more unfair over time and it's going to become more unfair if we don't change."
The current system of buying RUCs was "a bit clunky", he said.
Those using diesel or a heavy vehicle purchased RUCs online from the NZ Transport Agency or they could go to an agent.
Motorists needed to keep an eye on their odometer to ensure they stayed up to date.
The other problem was the the RUC came in the mail and needed to be displayed on the dashboard.
AA supported Bishop's plan to make the system fully electronic.
Annual warrant of fitness checks were the main way to ensure compliance at present.
"But it's fair to say it's difficult to enforce being an annual system so there's a fair degree of evasion and avoidance and that's something that will have to be addressed in the transition."
Heavy vehicles already have an ERUC, a device in the trucks that monitors kilometres and location.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
RNZ News
2 hours ago
- RNZ News
Boundary reshuffle puts MP outside own electorate
Selwyn MP Nicola Grigg lives in Prebbleton, which is no longer part of the Selwyn Electorate. Photo: Supplied via LDR Selwyn MP Nicola Grigg no longer resides within her own electorate following a boundary reshuffle . The independent Representation Commission has confirmed the final boundary changes to electorates ahead of next year's general election. As a result of big population growth in towns like Rolleston and Lincoln, the Selwyn electorate is passing around 11,000 voters over to the Wigram electorate. Those voters come from a large area including Prebbleton and Templeton. This means that two-term Selwyn MP, National's Grigg, now resides in the Wigram Electorate, but plans to seek a third term. "I don't intend to move out of Prebbleton at this stage, but will continue to work hard to earn the support of Selwyn residents," Grigg said in a statement. "Selwyn is a rapidly growing region and today's finalised boundary changes reflect the electorate's unprecedented rise in population. "The changes show that Prebbleton and Templeton are moving out of the Selwyn electorate - it has been a privilege to serve these communities as their local MP." There is no legal or constitutional requirement for MPs to reside within the electorate they represent. Grigg first entered Parliament in 2020, taking over from National's Amy Adams in what is regarded as the safest blue seat in the country. She was re-elected in 2023. Grigg is the Minister of State for Trade, Minister for Women, and Associate Minister of Agriculture. Selwyn's population growth, which sends the Templeton and Prebbleton communities into Wigram, has flow-on effects in Christchurch Central, Ilam and Christchurch East, around Addington, Spreydon, Linwood/Phillipstown and Northcote. In a change from the proposed boundaries, Redwood remains with Christchurch Central, and instead Christchurch East gains an area from Christchurch Central in Linwood and Phillipstown. The only other change in the South Island is that Invercargill expands into the area west of Winton, taking an area from Southland. LDR is local body journalism co-funded by RNZ and NZ On Air.
1News
2 hours ago
- 1News
'A bit like Star Trek': Politicians take City Rail Link test run
There's been another milestone in Auckland's City Rail Link with people from outside the project allowed on an underground test run for the first time. Prime Minister Christopher Luxon was aboard along with senior ministers, city leaders and other officials. The train journey started at the revamped Maungawhau Station and headed into a tunnel to arrive at Waitematā or Britomart Station. "We were just saying it's a bit like Star Trek, warp speed up there the way the tunnel is lit," Luxon said after standing with the driver. City Rail Link's first test train. (Source: ADVERTISEMENT Auckland Mayor Wayne Brown stayed seated and chatting with the Finance Minister during the trip and maybe didn't see the warp speed lighting. "We don't really see exactly what we've got here just yet, but it's good, this is a good step in the direction," he told RNZ. In a speech before getting on the train, Brown said getting to today had not been cheap or easy, with Auckland enduring a decade of construction that has been tough. He warned future projects needed to be done better and faster and could not be done on what costs were now. There have been more than 1600 test train runs in the new City Rail Link tunnels so far. Vince Ahkuoi was the driver. "I haven't driven a train that is that important, I don't think," he said. ADVERTISEMENT Today showed just how far the City Rail Link had come, another driver Grant Dowie said. He said test trains had run more than 5000km since February and 50 drivers had been trained. "And if you think that the tunnel is only 3.5km long, to get over 5000km of test running we've been running backwards and forwards multiple times," he told RNZ. He said the VIP test train on Friday showed that testing had done its job, but there was still much more to do. "We started at walking pace, and then we went to 3km [an hour] and then we went to 10km and then we went to 25 and then 40," he said. Prime Minister Christopher Luxon at the City Rail Link's first test train. (Source: Trains now run at 70km/h and a key test was making sure the trains actually fit. ADVERTISEMENT "I know it's a silly thing but in other parts of the world there have been situations where they've built a tunnel and then the trains didn't fit," Dowie said. "I know people are thinking 'well why aren't we opening the tunnel' but it's a journey that we have to go through to make sure it's safe before we open." City Rail Link officials are hailing Friday's VIP test run as a milestone but say there is still a long way to go before the public can have its turn. CRL chief executive Patrick Brockie said testing and commissioning was the most complex part of the $5.5 billion project. "There is still a lot of work to do before we know when exactly passengers will ride," he said. Several politicians attended City Rail Link's first test train. (Source: Another on the train, Finance Minister Nicola Willis was happy with what she saw. "The feeling I have is it looks like when you're overseas and you go in a proper underground subway and that's an experience many New Zealanders have had and now they can have it here in Auckland," she said.
Scoop
3 hours ago
- Scoop
Long-Term Investment Is Guaranteed Lotto ‘Win'
Article – RNZ The odds of winning Lotto First Division are about one-in-3.84 million and Powerball is even less likely., Money Correspondent The money you're putting aside for your Lotto ticket could give you an almost certain $100,000 windfall. Lotto's Powerball is rolling over for a $20 million prize on Saturday, but while statistics show we spend a combined more than $700 million a year on Lotto products, investment experts say people might be missing out on a prize that they are much more likely to achieve. The odds of winning Lotto First Division are about one-in-3.84 million per line. Powerball is even less likely – at about one-in-38 million. On the other hand, if you put money away each week, fortnight or month, the power of compounding will deliver you a solid return, given time. Hamilton Hindin Greene investment advisor Grant Davies calculated the outcome for someone investing $25 a week over 45 years at just over $58,000, without any investment returns. If they received an after-tax and after-fee return of 4.5 percent, compounding weekly, they would grow their investment to $189,785. Adjusting for inflation, both in the weekly contribution and the future value of the investment, the investor would end up with about $160,000. 'The allure of Lotto is that big win and the hope that comes along with it,' Davies said. 'That's why people do it, but if you start to do the maths, it often doesn't stack up quite so well. 'The thing about compounding interest is that it does take a long time for small amounts to build up, but once they do build up, that's when you start to see the real benefit. 'Over 45 years, it's not until you get to the final 20 years that you see the real effects of compounding start to play out. 'That's part of the human condition – we're maybe more tuned to the short-term dopamine hit than the long-term one.' Over a long time horizon, he said most investments should perform, 'but when you're only dealing with small numbers at the beginning, it's hard to see that result at the end'. Hatch managing director Waimarie Marks said she knew people who spent a lot more than $25 a week on Lotto. 'I think it's because it's a habit they can't break,' she said. 'Although there is so much literature out there about the benefits of investing and compounding growth etc, the 'hit' of potentially striking big likely draws them in. 'I will say, though, an upside of Lotto is the good work this money can do in the community.' Koura KiwiSaver founder Rupert Carlyon said a big win was more alluring than a slow and steady return. 'Even though you know that it is a one-in-38 million chance of winning, you think maybe you will be that person. 'It's the same as a capital gains tax. Most people would benefit from it, yet it still polls negatively, because people think that one day they will benefit from a capital gain that they want to have tax free. 'Lotto are currently going through a process where they add an extra number. This will reduce the odds and allows them to offer bigger prizes. 'Their research is showing them that bigger prizes will mean more tickets sold. Unfortunately, it is human psychology. 'We love big numbers and love to believe we will be the lucky ones, despite what the logic says.' Fisher Funds chief executive Ana-Marie Lockyer, said it was behavioural economics. 'You only need to watch Lotto's latest TV ads to understand it isn't just about the money – it's about your dreams coming true overnight. 'The prospect of winning millions offers an immediate emotional payoff that saving or investing can't match, even though the odds of a big win are extremely low. 'Gambling a relatively small amount each week feels harmless and the occasional small win keeps people going back for more. 'Saving or investing, on the other hand, doesn't offer the same excitement, because the payoff is usually a long way off, and it's seen as complex and only for wealthy people. 'Most people don't realise investing $25 a week into a balanced KiwiSaver fund earning 3.5 percent a year for 10 years could add up to $15,500. 'We need to change those perceptions, so investing is seen as the best way of achieving those same dreams.'
