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Victorian Budget sets up sustainable infrastructure-led recovery

24 November 2020 -  Roads Australia (RA), the peak body for roads within an integrated transport system, says today’s Victorian State Budget confirms the central role that enhanced transport infrastructure will play in powering Victoria’s post-COVID economic recovery.

The Budget’s $10 billion investment in transport infrastructure - including signature projects such as the Melbourne Airport Rail Link, the Suburban Rail Loop and Geelong Fast Rail - is vitally important in equipping Victoria with a modern land transport network that is less congested, better integrated and more sustainable,” said RA President Michael Bushby.

“These investments, along with others in the Budget such as the $450 million ‘road maintenance blitz’ will help support job creation in a difficult economic time, while also delivering the improved safety and enhanced capacity that Victoria’s transport system needs.

“RA is actively working with the Victorian Government to pursue the recommendations contained in RA’s recent Procurement Reform Report so that the benefits of infrastructure projects for the economy and the community are fully realised.

“RA particularly acknowledges the balanced approach the Victorian Government is taking to the development of a sustainable framework for road user charges for electric vehicles (EVs). RA welcomes the Budget announcement of $25 million to accelerate the adoption of EVs, while also recognising governments have an obligation to maintain a sufficient revenue base to support road infrastructure for the whole community.

“Fuel excise was always intended to fund the construction and maintenance of our road networks. However, as vehicles have become more fuel efficient, the proportion of revenue generated by fuel excise has fallen. The Commonwealth Parliamentary Budget Office has published research noting that revenue from fuel excise declined from 1.6 per cent of GDP in 2001/02 to 1 per cent in 2016/17.

“Bringing EVs into the road user charging system is not about penalising one market segment. Rather, it is a first step in a wider transition away from blunt instruments such as fuel excise towards a whole-of-market road funding model that strengthens links between road related revenue and road related expenditure.

“Over the past two weeks, Victoria, New South Wales and South Australia have announced that they intend to address road user charges for EVs in 2021. It is clear the momentum for road charging reform is building – and this momentum should be harnessed to drive development of a nationally-consistent approach.

“As RA noted in our original submission on this year’s Federal Budget, it is essential that road pricing and investment reform models are transparent and equitable for all road users. RA encourages all governments to facilitate this approach for road user charges for EVs, as a vital step in building towards comprehensive micro-economic reform around road user charging and investment for all vehicle types.




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