Use fuel excise to clear $4 billion black hole for local roads

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Daniel Stanton 28 June 2014

The National Roads & motorists'Association today released a report highlighting a $3.87 billion funding backlog needed to bring NSW council roads up to a 'satisfactory condition', renewing calls for the Australian Government to return half of the fuel excise to fix roads.

The definition of 'satisfactory condition' is council's estimated cost to bring the road to an acceptable standard. It does not include any planned enhancements to existing roads.

The NRMA report, Funding Local Roads used figures submitted by 152 NSW local councils to the NSW Government as part of their annual reporting obligations that summarised the money needed to fix local roads.

In metropolitan Sydney, councils have stated that $911 million was needed for road works while regional NSW councils needed $2.96 billion in funding.

Sydney metropolitan councils requiring the most money to bring their local roads up to a satisfactory condition were:

  • Liverpool - $149.6 million;
  • Ku-Ring-Gai - $110.3 million;
  • Sutherland - $67.9 million;
  • Hawkesbury - $62.6 million; and
  • Blacktown - $60.4 million.

NRMA President Wendy Machin said some local councils would take years to clear their backlog of roadworks at current funding levels.

"Some councils have no choice but to let bad roads get worse - the money is simply not there for them to fix roads within their boundaries," Ms Machin said.

"It's not the local councils who are to blame as the money they're requesting isn't for glitz and glamour - it's for the basics including fixing pot holes, repainting faded lines and gutters.

"The problem in regional NSW is even worse than Sydney with almost $3 billion needed. Heavy rain can deteriorate local roads and this is why many regional councils are simply allowing previously sealed roads to turn to dirt.

"Fixing local roads also benefits the community as the cost of crashes to the NSW economy amounts to $2 billion each year."

Funding Local Roads explores options to help clear the $4 billion needed to bring local council roads up to a satisfactory condition. These include a greater return to councils from the Australian Government's fuel excise tax, increasing the NSW Government's Local Infrastructure Backlog Fund and lower interest lending to councils.

Currently, $15 billion is collected by the Australian Government for all road users, from the fuel excise levy at a rate of 38.143 cents per litre for unleaded and diesel fuel purchases. Only 10 cents out of 38.143 cents collected from Australian motorists is returned to the road network.

Ms Machin said annual Australian Government investment in the NSW road network has varied between $3.6 billion and $6.2 billion over the past six years but more was needed.

"We are calling on the Australian Government to return at least half of the fuel excise tax collected into road funding and for a pre-determined allocation to go directly to local councils to help ease the $4 billion black hole that NSW councils are facing," Ms Machin said.

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