Emissions Trading Scheme (ETS) Auction Rules
While the AA is not a participant in the ETS its motorist Members fund the liquid fuel wholesalers who are obligated parties under the Act. This submission is made in light of the Commerce Commission Market Study into the Retail Fuel Sector. Part one explores the relationship between competition within the liquid fuels market and the ETS. Part two takes this context and explores the Ministry’s questions in the technical consultation document. Part three raises the question of how the market should respond to large scale shocks. Broadly speaking we would like to see the ETS design to be at least as transparent as the NZX and more discussion of the role of the Commerce Commission in the ETS, and perhaps more information about the tax treatment of banked NZUs. Finally we recognise that no market springs into existence perfectly anticipating the demands of its customers, sponsors or the public. We therefore propose a process of intense review in the initial years slowly relaxing as the inevitable problems are ironed out.
Proposed National Policy Statement on Urban Development
The Government released a discussion document proposing content for a National Policy Statement (NPS) on Urban Development. The AA’s submission highlighted our support for the creation of an NPS focussing on urban development – noting that failure to effectively plan for growth, including through provision of sufficient infrastructure, will result in poor outcomes. However, we also outlined our concerns that the proposed content of the NPS appears to largely overlook the role that private vehicles will continue to play in our cities for the foreseeable future (even with increased investment in, and intensification around, public transport), and failure to adequately provide for this will result in increased congestion and travel times – ultimately resulting in urban areas that are less liveable, less productive and less successful.
Clean Car Standard and Clean Car Discount
The Ministry of Transport has issued a discussion document proposing a fuel efficiency standard for newly imported (new and used) cars and a scheme to impose an emissions-based "feebate" (penalty or discount) for newly imported (new and used) cars when first sold in New Zealand. The AA supports the goal of encouraging fuel efficiency at reasonable cost to motorists but found the Governments detailed proposals highly problematic. Our submission noted that the schemes as proposed would have imposed a considerable tax while doing very little to reduce greenhouse gas emissions and there were a number of significant perverse outcomes possible. A dialogue with the government is in progress.
Road to Zero road safety strategy
The Government has released a new road safety strategy for 2020-2030 which has a goal of reducing deaths and serious injuries by 40% by 2030, which the discussion document says is achievable, based on a substantial programme of road safety improvements. The AA’s submission noted that the draft strategy is short on detail or concrete actions, including trade-offs that will need to be made by decision-makers and the community at large. If we are to achieve similar reductions in deaths and serious injuries as in other countries that have adopted the “Vision Zero” approach, then we will need comparable levels of investment in all pillars of the Safe System. We said the final strategy needs to explicitly set out what resourcing and money is going to sit behind it in order to achieve the target, and how this is going to be rolled out.
Drugged Driving Discussion Document
AA Members have strongly supported improvement in roadside drug testing for many years, believing the current physical Competency Impairment Test police staff can order when they have good cause to suspect drug use is too cumbersome so only a tiny fraction of impaired drivers face being caught. The AA recognises that current testing technology has limitations so a new system must allow for future developments. Key principles underpinning the AA’s view on improving drugged driving detection are that deterrence is the key; new ways to test for drug impaired driving need to be complemented with public awareness campaigns, improvements in medical information and more rehabilitation services; significant additional funding is needed for an effective response to the issue; enforcement should be focused on drivers impaired on the road; and New Zealand needs to collect more comprehensive data related to drugged driving.
Land Transport (Wheel Clamping) Amendment Bill
This Bill proposes to introduce a maximum wheel clamping fee of $100 that can be imposed by anyone who uses “immobilising devices” for parking enforcement on private property. It is a response to years of complaints by motorists who claim they have been unfairly penalised, often because parking rules are unclear, with fines to release a clamp often exceeding $200.
The AA has long called for private parking and enforcement to be regulated, so this Bill is a positive development which we support, however we would prefer it to go further, by also regulating minimum signage standards for the operators of privately-owned public carparks.
Driver Licensing Amendment Rule
This Rule proposes a number of changes to licensing requirements, many of them administrative, but the biggest change is to reduce the requirements for eyesight testing. The rule proposes to only require an initial screening when obtaining a Learner licence, another from age 45, and then again from age 75 and bi-annually from age 80. The AA’s preference is to retain the current 10-yearly test, but in the absence of that we supported this proposal. We also supported removing the requirement for screenings at each stage of the GDLS, provided people graduated to the next phase within 2 years. Other proposals include removing the Class 3 licence, which the AA supported, removing the requirements for special-type vehicle endorsements, which we opposed, and standardising the rules for tractors.
Light-vehicle Brakes Amendment Rule
The primary proposal of this Rule is to mandate that newly-imported motorcycles be fitted with ABS as standard, or a combined braking system in the case of mopeds over 125cc. This Rule would take effect from as early as November 2019 for ‘new design’ new motorcycles, and November 2021 for ‘existing design’ new models and used imports.
The AA’s submission supports this proposal on the basis that international evidence shows that ABS reduces motorcycle crashes on sealed roads, but that the earlier date be delayed until April 2020 due to the long lead time needed by manufacturers. The Rule would not apply to specialist motorsport bikes, but we sought clarification that it also exempts farm bikes. The AA also supported exempting any used imports manufactured prior to 1990, and the creation of a new Special Interest Motorcycle (SIM) permit scheme (similar to the one for cars) to exempt up to 100 newer specialist motorcycles that are not manufactured with ABS.
Market study into retail fuel sector – preliminary issues
The Commerce Commission has released its proposed scope for the market study into the retail fuel sector, including the preliminary issues it proposes to explore. Whist the study is expressly limited to sale of petrol and diesel to retail customers, the AA’s submission suggested that the study also needed to compare retail margins with margins for other fuel products (aviation, marine, bitumen and bulk diesel) as we are concerned that these may be being cross-subsidised by retail fuel sales. We also said the investigation of margins needs to separately assess regular (91 octane), premium (95 and 98 octane) petrol grades, and diesel, as margins are consistently higher for premium petrol and diesel compared to regular petrol, meaning prices may be higher than they should be. We also noted prices for premium petrol are often much higher than regular due to the lack of price discounting (which could be rectified by mandating the display of premium prices on the roadside boards).
Local government funding and financing
The Productivity Commission is currently undertaking an inquiry in local government funding and financing. Local government is responsible for providing the services (including water, transport, flood protection, waste management) that enable communities to function. The inquiry will investigate the cost of services provided by local government, how they are paid for and the adequacy and efficiency of the current local government funding and financing framework.
The AA’s submission naturally focused on transport costs; the main concerns we highlighted are:
- Potential underinvestment in transport infrastructure
- A lack of knowledge about the condition and performance of critical assets, resulting in poor asset management (such as maintenance not happening when needed)
- No clear national standards for the state of roads
- Ensuring ratepayers understand what service improvements they will receive in return for increasing rates
- Making best use of funding tools, especially ensuring those who benefit are paying for transport infrastructure