Road-user charges 'needed to drive efficiencies'

Infrastructure Australia Chief Executive Officer Philip Davies has highlighted the challenge in creating effective markets across road and rail, freight and passenger networks, suggesting “the test for governments is to establish whole-of-network pricing and regulatory systems” to support efficiency and service improvements.

Delivering a speech in London to the Australian British Infrastructure Investment Catalyst Conference, Mr Davies said, “In particular, we need to move to a more sustainable model of charging for road use … in Australia, paying for toll roads is already an accepted practice for motorists in Sydney, Melbourne and Brisbane.

“It’s not difficult, then, to imagine a future where we have a mass, location, time and distance-based charging mechanism in operation throughout Australia.”

In his speech, Mr Davies also commented on the fact that Infrastructure Australia’s 2015 national audit found around 80 per cent of premises located outside the big cities received the lowest quality fixed-broadband rating. And he cited the sale of Telstra as a vertically integrated (backbone infrastructure and retail) monopoly as one of the reasons for this.

“This meant that there were limited incentives to provide good internet services to customers across the country,” he said.

“This experience reminds us that the sale of monopoly infrastructure must be carefully considered and managed to ensure we always prioritise the interests of the customer over maximising the revenue generated from the sale of a monopoly asset (whether vertically integrated or separated).”

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