Cost of driving is becoming punitive in Brisbane

Brisbane, like many cities across Australia, is facing a mounting budget deficit in the wake of the near-crippling financial crisis and ensuing recession, as the state capital, it must also oversee Queensland’s plunge in revenues, which has created a budget deficit of over $2.3 billion for the state.

At the same time, the unemployment rate has risen to close on 7% and residents across Brisbane are feeling the pinch as the economy tries to recover.

It is not a good time then, for the Brisbane city council to be privatizing the city’s most important roads, which will inevitably lead to higher toll fees for the motorist.

The increasingly steep toll charges began before the recession, however, although the privatization of the roads has now become a way by which local government can raise much needed capital.

In 2006, truck drivers in Brisbane reacted angrily to suggestions that they should pay $70 to use the Pacific Highway between Sydney and Brisbane. The federal government’s suggestion had been that the revenue generated would speed up infrastructure improvements on the highway, such as the conversion of the road into a duel carriageway.

The government wanted to bring in private companies to complete the work, and the toll would pay for the private sub-contractors.

The truck drivers, part of the Transport Workers’ Union, argued that they, as well as general motorists, had already paid for the conversion of the highway through taxes and increased road charges. The work on the Pacific Highway is ongoing with just 45% current converted to dual carriageway status, despite the federal government’s announcement in 2009 that $3.1 billion would be allocated to the upgrade project.

The highway is an import link between Sydney and Brisbane, and is notoriously dangerous, especially during peak holiday seasons.

In June 2008, the Brisbane public were hit with further toll increases for use of essential roads within the city such as the Gateway and Logan motorways, which saw an 11% increase in tolls on top of petrol prices which, at the time, were at record highs. The recession has since eased the petrol price, but now tolls are expected to increase further as the Queensland government considers selling tolling rights on the Logan, Gateway and Port of Brisbane motorways.

This will hit Brisbane drivers hard, especially when one considers the various factors that have an effect on traffic volumes. The private company that takes over the tolling rights will be subject to the plans of the local government in terms of public transport upgrades, land zoning, and the management of the road network feeding the privatized road.

In effect, if traffic volumes dropped, which means revenues and profits would drop, then the private operator would be forced to push tolls up even further. And even though there are checks and balances in place with the city council to prevent toll charges increasing beyond a certain point, these can be, and are, renegotiated.

The privatization of the road can then become more expensive for the city, as is the case in the example of Sydney’s Lane Cover Tunnel, which went into receivership. The same could happen in Brisbane.

Now, to make the privatization deals more worthwhile for private operators, toll charges in Brisbane are expected to be increased even further by the Queensland government. In mid 2010, it is expected that the toll charge will increase by around 30 to 40%.

In addition, petrol prices are going up again because of the removal of the fuel subsidy, and registration costs for vehicles have increased as well. The city has said that the motorist will benefit from upgrades to the infrastructure, though Brisbane news outlets have suggested the price increases are mainly to ‘sweeten the deal’, so to speak, on the sale of the Queensland Motorways company to private operators.

At a time of deep recession, corporate Brisbane has also accused the local government of unfairly penalizing commercial traffic, which will pay a much higher toll, and has suggested to Brisbane news media that the policy will send many businesses broke during already difficult economic times.

The local government once again appeal to road upgrades to justify the increases on most of Brisbane’s important routes, but infrastructure upgrades take years, and if the privatization is to occur next year, the upgrades will be left to private operators to complete, and the local government will cease to have any control over that, making the promise an empty one.