The Government’s announcement this week that it will extend the transport support package, including the 36% RUC discount, through to 30 June this year is great news for both the industry and consumers.

The decision, announced by Prime Minister Chris Hipkins, Finance Minister Grant Robertson and Transport Minister Michael Wood, shows that the Government has heeded the advice of Transporting New Zealand, which has been calling for this move for months. We have met regularly with ministers, officials, and spoken out in the media. It’s good to see Prime Minister Hipkins committing to the “bread and butter issues” facing the country.

This decision also clearly demonstrates the effectiveness of our industry when it speaks with one voice (in this case it was only ours) and reinforces Transporting New Zealand’s role as the leading advocate for road transport.

As we have pointed out in the media, the support package is not all about cheaper petrol and half-price public transport – although those parts of the package will undoubtedly help ease the cost-of-living burden on most families.

If the RUC discount had not continued, road transport companies would have faced a whopping increase in running costs – for a single linehaul truck, they would have had to pay nearly $20,000 more in RUC per year. Operators would have had no choice but to pass those costs on to consumers. At a time of already high inflation, that would have piled on the pressure for those already struggling with the rising cost of living.

Trucks carry 93% of freight and the industry is the semi-conductor of the New Zealand economy, so this decision means that everything a truck carries will have some transport price relief for a period to come. That will assist all Kiwis. Keeping the support package in place for a while longer will help reduce inflation.

Businesses will also benefit. Transporting New Zealand last year released a survey of hundreds of road transport operators which found that almost 90% said that cost increases were having a serious or very serious impact on their businesses.

We would like to thank our members for their support, including those who participated in our operator costs survey last year, and those who have shared stories about the cost-of-living crunch on their businesses.

Transporting New Zealand is realistic about the fact the discount can’t continue forever – particularly given the pressing need for more road maintenance and investment. However, we think it needs to be extended until inflation falls below 6%, and then phased out gradually to avoid price shocks. We’ll be keeping a close eye on developments throughout the year.

Unfair contract terms

On another note, Transporting New Zealand is keen to hear from operators who have been on the receiving end of unfair contract terms, particularly around payment practices and invoice payment periods. Trucking is a fiercely competitive industry, and customers can sometimes abuse that power dynamic when setting terms on a “take it or leave it” basis. This includes allowing delaying payments, penalty clauses, and allowing unilateral contract changes.

We want to share examples with the Commerce Commission, who have the ability to investigate unfair payment terms in standard form contracts.

By Nick Leggett, chief executive, Ia Ara Aotearoa Transporting New Zealand