Rod Sims Chairman, Australian Competition and Consumer Commission Key points: • Direct road-user charging would see better utilisation and efficiency across the transport sector. • Like pricing reforms in other utility markets, road-charging reform would better balance supply and demand – and provide sustained funding for transport infrastructure. • With motoring clubs now actively supporting reform, there is an opportunity to progress toward solutions based on time/distance/mass/location-based charging.
Australia’s infrastructure is vitally important for our productivity and living standards. Australia’s declining productivity is disappointing, but not surprising. Poor infrastructure policies and practices on too many fronts, and over too many years, have contributed to this decline – closely linked to the fact that Australia has lost a good deal of its procompetitive culture that was gained from the 1990s’ National Competition Policy. It is easy to conclude that Australia treats its infrastructure sectors poorly. Policies that prevent competition in coastal and liner shipping, inadequate dedicated rail freight paths, a poor policy framework for road investment, limits on supply and competition in urban water, costly past rules for energy network regulation, and other limits on infrastructure competition in many areas are all evident. Into this environment comes the Harper Review of competition policy. It is extremely timely, and has important recommendations on many fronts. The Hilmer reforms of the 1990s were forecast to 44
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boost Australia’s gross domestic product (GDP) by an enormous 5.5 per cent. The Harper competition reforms can also boost our national prosperity significantly. There is the usual pushback from those who benefit from the status quo; for example, from taxi drivers and owners (opposing taxi industry reform and moves to encourage innovative passenger transport services), from the maritime unions (opposed to freeing up coastal shipping), from the Business Council of Australia (opposed to a workable ‘misuse of market power’ provision), and so on. As with the Hilmer Review more than 20 years ago, the Harper reform agenda benefits from its breadth, as it dilutes this opposition, with change able to occur on many fronts. The Harper Review had a lot to say that is relevant to infrastructure. It recommended important and wideranging reforms in energy, water and transport.
The pressing need for road reform Australia’s road policy framework has at least three problems.
