New Minister of Transport, new opportunities

If you follow politics, either at home or internationally, the last few weeks have proven somewhat of a bonanza.

The New Zealand election result – and to a lesser degree the US one – will have a far-reaching impact on our road transport industry. The brewing international impact of COVID-19 could materialise via economic shocks, which will undoubtedly surprise us in 2021. As such, it will be vital that a strong supply chain is understood and supported by government to ensure the security of freight to reach its destination.

Prime Minister Jacinda Ardern announced her new cabinet at the start of the week. The RTF is very relieved to see that the Green Party will have no role in transport. In fact, former Associate Minister Julie-Anne Genter will not have any ministerial responsibility in the new government.

Phil Twyford is no longer the Minister of Transport and the portfolio has been passed to Michael Wood, a first-time minister and MP for Mt Roskill in Auckland. Minister Wood has given an early indication that he has a pragmatic view about roading projects (such as being open minded on the construction of a new Mount Victoria tunnel in Wellington, which was previously opposed by the Green Party).

If we look at the state of the nation from the Government’s perspective, they have to build infrastructure fast, and that will have to include roads.

On behalf of the industry, we have been in contact with the new minister this week. In our briefing paper we have outlined the contribution of the road transport industry to the New Zealand economy. We have pointed out that trucks are a key part of meeting the freight task, even if you are keen on trains, as the government has indicated it is. The convenience of door to door delivery, the resilience offered by road transport and the time sensitivity around the need to deliver many goods continues to put road transport in pole position.

We want the Government to work more closely with our industry in recognition of the contribution operators make keeping our economy moving. We would like the Government to prioritise development of a freight strategy for New Zealand. Such a strategy would recognise the importance of the supply chain and how to keep it secure by setting high level principles to guide transport investment. We must build “freight literacy” among the public and decision-makers. Developing a strategy could be a start to achieving this. 

We also want to see more transparency about where the National Land Transport Fund is spent.

Industry operators (heavy vehicles) contribute almost a $1 billion per annum through Road User Charges. It is obvious this fund has been “dipped into” by the Government for things other than road building and maintenance. We can only speculate about how much money has gone into light rail, KiwiRail and of course those cycle lanes. Meanwhile, our highways and roads have become more dilapidated, which has led to increased costs for operators via repairs and maintenance.

We have requested partnership with the Government on our driver shortage challenges. The RTF surveyed a statistically significant proportion of our industry this year (over 600 operators) about their experiences of a shortage of drivers. The survey found that 37% of operators had at least one truck parked up due to not having enough drivers. The industry is taking the initiative by starting our traineeship Te ara ki tua Road to success, but we do need support from Government to assist us with important components such as a more fit-for-purpose licensing system to ensure we maximise success.

– Nick Leggett, CE, Road Transport Forum

 

An election like no other

Like the year 2020 generally, it felt like New Zealanders just wanted the election to be over and done with. That probably goes for the politicians too!

A weariness had set in over recent weeks, possibly because most people felt the overall result was ‘baked in’ and a forgone conclusion. Most of us knew there would be a Labour government in some form. The questions remained though, would they need the Greens and would Winston sneak over the line?

Full credit to Jacinda Ardern and her team, they won big. Kiwis recognised the hard work of the Government during the COVID crisis and they opted for stability. It is true that we will need stability as, in the view of the RTF, the worst of the crisis is ahead of us with the economic challenges we will face over the next few years.

Whether the PM chooses to enter into some kind of arrangement with the Greens or the Maori Party is open for discussion for a little while longer, although it has clearly been signalled that this will not be a coalition government.

It probably isn’t any secret that the RTF won’t be disappointed to see the Green Party out of transport. Their lack of understanding around the movement of freight, let alone a blatant antagonism towards roading, is palpable. That will be part of the PM’s balancing act.  

Of course, we are keen to work with whoever is selected transport minister; be it the incumbent Phil Twyford, who we enjoy engaging with, or somebody new. The opportunity for a transport sector accord, as suggested by Twyford and promoted by RTF, would be a really constructive way of partnering with the government around the challenges we face, including with workforce, skills, regulations and health and safety.  

Labour does need to do more than it did in its first term to meet business halfway. We are concerned with their proposed agenda when it comes to employment legislation; doing away with the owner driver or contractor driver model and forcing rules that will make it harder for our industry to keep delivering for New Zealand’s economic wellbeing.

We will keep up the fight for better roads. We know industry can have an impact here, given that our recent calls for an increase in the roading maintenance budget resulted in the Government increasing the amount spent by $100 million per annum for the next five years.

Finally, like all of the private sector, the road transport industry requires infrastructure investment to be delivered, not just announced. We will be eager champions of the roll-out of projects, both roading and others, as they will improve the ability of trucking operators to go about their work on safer roads, and will also provide work for industry members supporting the construction sector.

I consider that this election brings the road transport industry a lot of opportunities. We have a chance to put our renewed case, to both the Government and the public – as neither group understands as well as they could – what we do every day to keep New Zealand moving. We also have the opportunity to work alongside officials and politicians to propose opportunities for improved regulatory rules, safety outcomes and to build our workforce capability and supply through the Te ara ki tua Road to Success traineeship programme.

RTF will brief the incoming Minister of Transport on the key industry issues and I’ll report on the content of that briefing in the coming weeks. It will help set our agenda over the coming parliamentary term.     

  • Nick Leggett, CE, Road Transport Forum

Know what you are voting for in cannabis referendum

A week out from the general election the Road Transport Forum (RTF) has made its final plea for people to be informed before stepping into the ballot box to vote on the cannabis referendum.

I spoke about some of the unintended consequences of legalising recreational cannabis for safety sensitive industries at a road freight transport industry breakfast event in Auckland yesterday titled, Clear the Haze.

I want to be very clear; the RTF is not telling people how to vote. We are posing questions that we believe need to be asked and we are putting the interests of the road freight transport industry up front. Those interests are safety and a desire for all truck drivers to go home at the end of every shift.

Our concern about the Cannabis Legislation and Control Bill Exposure Draft for Referendum centres around the impacts on workplace health and safety and the costs and liabilities that go with increasing risk in the workplace.

While employers can drug test professional drivers, those drivers share the road with all other road users who are not subject to that scrutiny. Poor decisions by those other road users could have bad consequences. When a cyclist, motorcyclist, or car connects with a 50 tonne truck, they come off second best. The truck driver might have done nothing wrong, but they have to live with the trauma of the outcome.

It is well recognised that cannabis causes impairment and judging that impairment for road users is an issue that has yet to be resolved. A new law was introduced just prior to Parliament dissolving for the general election. If passed, the Land Transport (Drug Driving) Amendment Bill will allow Police to roadside test drivers to see if they are under the influence of drugs, just as they do for alcohol. The RTF has lobbied hard for roadside drug testing and we will continue to push for this as this Bill progresses through the Parliamentary process once the election is over.

Because it’s election time, those for and against legalising recreational cannabis throw up all manner of research to back their case. We suggest establishing the veracity of research before taking it as gospel, and certainly challenging claims that legalising cannabis will reduce use and cut out the illegal trade.

We’ve looked at research by global company Deloitte in Canada, which has adopted country-wide legalisation of recreational cannabis, similar to what is being proposed in New Zealand. It suggests increased (up 22 percent), rather than reduced use – let’s face it, shops open to market their wares, not to have no customers; and that those on lower incomes and with less education tend to continue to buy from their illegal channels.

We’ve also looked at insurance data from the USA, where some states have legalised marijuana. We trust insurance data because it works on a risk-based model and the level of risk determines the price of insurance. Higher risk, higher liability, higher insurance, higher costs – everything goes high!

The Insurance Institute for Highway Safety (IIHS) and the Highway Loss Data Institute (HLDI) in February 2019 reported that crashes are six percent higher in states that legalised marijuana compared to four neighbouring states where marijuana is not legal. IIHS found that drivers are largely unaware of the risks of using marijuana while driving.

Of course, this research only relates to accidents on the road, not accidents that may occur at the depot, yard or workplace as a result of impairment. And all the experts agree more research is needed. But what is clear is there is good research that points to increased use when recreational cannabis is legalised; the illegal market remaining in play; and impairment on the road leading to more crashes.

All risks have costs and we can only see legalised recreational cannabis adding to business costs in the road freight transport industry. As practically everything is carried on the back of a truck at some point of the supply chain, those costs will work their way down to the end consumer.

But the greatest cost we want to avoid is more fatal accidents on New Zealand roads as a result of drug driving.

So, know what you are voting for.

– Nick Leggett, CE, Road Transport Forum

Hold politicians’ feet to the flame on promises

It’s election season and the promises are rolling in. Whoever the public of New Zealand vote in to lead us for the next three years, they must demand delivery on those promises.

We are facing the most difficult three years ahead in many of our lifetimes – except those who have lived through wars. Covid-19 continues to baffle experts on how to live with it, or vaccinate against it. Meanwhile, countries such as New Zealand become increasingly isolated with closed borders, unemployment levels will leave scars for years to come, those who are hanging onto employment are stressed to the max, and money without interest is becoming increasingly worthless.

These are tough times and they have exposed a number of cracks. Our biggest city Auckland, responsible for the lion’s share of our GDP (nearly 40 percent) has been battered in the past two months. First there was the debacle of cutting it off from the rest of New Zealand at Level 3 and then late last week, a weather event took out much of the capacity of the Auckland harbour bridge. A permanent fix is likely to be months away.

Given New Zealand’s high-risk profile due to its susceptibility to numerous natural disasters, as well as biosecurity incursions, weather events, and now a pandemic (which has always been planned for), it has been extraordinary to watch the scrambling round by Government to respond appropriately.

This week, Treasury asked us for our views about the Covid-19 experience so far and they seemed surprised when we listed the government departments that were missing in action from our perspective. Yet the Government and the public of New Zealand expect there to be food in the supermarkets and things for them to buy as if the supply chain works by magic, regardless of the disaster.

The only agencies that seem to have a grasp of the exports-imports nature of New Zealand’s ability to survive economically – and therefore, an understanding of the supply chain – are the Ministry for Primary Industries and the Ministry of Foreign Affairs and Trade.

Rule number one of preparedness for disaster is having a good network of stakeholders in advance. Yet as key stakeholders on the supply chain front, we have had to bash down doors to get the government to understand how goods get from A to B and why it’s important. Oxygen for that hospital treating Covid-19 patients anyone? This Government seems to have an aversion to advice from the business community.

When people sit for hours in traffic – as they did at the Auckland road borders in Level 3 and they have trying to get from the North half of Auckland to the other half this week – you lose productivity. Costs go up, as freight is delayed. Time is money. Not everyone can ‘work from home’, certainly not those in the supply chain.

The vulnerability of Auckland has made some things crystal clear. You can’t have your major city put under the pressure it has been in the past couple of months. That’s before we even get onto the lack of water for the summer months ahead.

There needs to be investment in infrastructure that is holistic and coordinated to give the best economic outcomes for the country as a whole.

Auckland needs to be a big focus of that investment – the rest of the country will benefit from that.

There needs to be an alternative harbour crossing and moving the country’s main port for its largest city more than one hundred kilometres away to Whangarei is a ridiculous folly that needs to be axed now. Imagine how that would have played out with a broken harbour bridge.

It’s time for whoever is in Government to get real about the state of our economy and the link between infrastructure and our recovery from Covid-19. We want to see evidence that the promised ‘shovel ready’ projects have a shovel, in the ground, with someone on the end of it, starting now. There also needs to be evidence of how many jobs were created and what was the return on investment for the economy.

We cannot waste money on the pet projects of politicians. There needs to be a solid plan. You could be forgiven for thinking right now that money grows on trees, but it doesn’t. It’s borrowed and one way or another, it has to be paid back.

– Nick Leggett, CEO, Road Transport Forum

* Find out what the five main parties are offering the road freight transport industry on our dedicated General Election 2020 page here.