eRUC a welcome step towards fair and sustainable transport funding - LGNZ

Local Government New Zealand (LGNZ) says councils are welcoming the Government’s proposed move to an electronic system for road user charges (eRUC), and the opportunity it provides to better fund the country’s local roading networks.

This follows yesterday’s announcement that the Government is working on changes to the system, with an intention to replace the current fuel excise tax with electronic road user charges (RUCs) on all light vehicles. A new digital system is expected to be in place by 2027.

LGNZ’s Transport Forum Chair Neil Holdom says that the Government will need to work closely with local authorities on the design and implementation of eRUC, in order for it to reach its full potential.

“Councils are responsible for around 90% of New Zealand’s roading network. It’s a core part of local government’s infrastructure work; councils spend nearly 2.5 billion annually on maintaining local roads and a portion of that is funded by road user charges via the National Land Transport Fund (NLTF),” says Neil Holdom.

“Minister Bishop has outlined a bold way forward for allocating the costs of transport infrastructure and this is to be commended. The sooner this can happen, the better.

“Local government has a strong interest in moving toward a more sustainable funding model for transport infrastructure. If done right, the introduction of eRUC will be an important step towards this, as it should mean we have a fairer road funding system.

“Right now, we know a lot of council have concerns that the funding they receive for building and maintaining their roads doesn’t fairly reflect the use they get, or the revenues they generate.

“Moving to eRUC will also result in access to better data - which should lead to a more fair and transparent approach on funding. Additionally, ERUC may help to fill some gaps in the data around which roads are being used and for what purpose.

“We look forward to working with the Government on how eRUC will look in the future, and how we can build a fair system for vehicle users - while continuing to ensure our local roads remain in good shape.”