Federal Government Considers ‘Pay-Per-Kilometre’ Vehicle Charges Photo:

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Trevor Collett | Jul, 15 2014 | 25 Comments

The Federal Government is considering long-term changes to the way motorists pay for the privilege of using roads, aimed at creating “more direct links to road users”.

A ‘pay-per-kilometre’ scheme could be on the horizon, governed by advances in on-board tracking or distance-analysing devices.

The idea is just one recommendation from the government’s Productivity Commission report into public infrastructure, which was released this week.

“Well-designed user charges should be used to the fullest extent that can be economically justified; however governments will have to continue to fully or partly fund some infrastructure projects and address equity issues,” the report said.

“Significant institutional and longer-term road pricing arrangements will create more direct links to road users, taking advantage of advances in vehicle technology.”

Exactly how the scheme would be implemented and run is unclear, considering road revenue is primarily the concern of state and territory governments at present.

One of the report’s key findings was a lack of ‘value’ from current and previous infrastructure projects, with the Commission calling for a ‘comprehensive overhaul’ to the decision-making process.

The report also said that private financing was not a “magic pudding”, and that ultimately users and/or tax payers would end up footing the bill.

The Commission believes there is room for greater spending on infrastructure by governments at all levels, but not under “current fiscal and debt management practices”.

The Public Infrastructure report comes two months after the Federal Government outlined “eight Snowy Schemes” in infrastructure in its May Budget.

MORE: Federal Government news, revenue news

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