Leveling the playing feild - Electronic RUCs for all
Transport Minister Chris Bishop recently announced Cabinet has agreed to a series of legislative changes to enable the transition of New Zealand’s 3.5 million light vehicles to paying for our roading network through electronic road user charges, rather than petrol tax.
“The abolition of petrol tax, and the move towards all vehicles (whether they be petrol, diesel, electric or hybrid) paying for roads based on distance and weight, is the biggest change to how we fund our roading network in 50 years,” Bishop says.
Adding, “For decades, petrol tax has acted as a rough proxy for road use, but the relationship between petrol consumption and road usage is fast breaking down.”
“As our vehicle fleet changes, so too must the way we fund our roads.”
“The Government’s plan will eventually see all vehicles pay based on actual road use (including weight) regardless of fuel type.
Changes will see:
Removing the requirement to carry or display RUC licences
Enabling the use of a broader range of electronic RUC devices, including those already built into many modern vehicles
Supporting flexible payment models such as post-pay and monthly billing
Allowing bundling of other road charges like tolls and time of used based pricing into a single payment
“I expect to pass legislation in 2026, followed by an updated Code of Practice for RUC providers,” Bishop concluded.
Commenting on the latest announcement, NRC CEO Justin Tighe-Umbers said, “Our Road User Charges (RUC) system gives New Zealand a unique opportunity to transition the entire vehicle fleet onto a single platform that is proven to allocate cost based on actual impact on the roading infrastructure.”
“Revenue generated from the current RUC user pays model is declining, while the need for roading investment and maintenance grows. This is an unsustainable situation, and a wholesale fix is needed, including a move away from the fuel excise duty. NRC supports the Government's recognition of the urgency of this situation and encourages the rapid application of expertise and resource to get it done.”
“This is a common-sense and necessary shift,” adds NZ Trucking Association CEO David Boyce. “New Zealand’s fuel excise model is outdated and failing to meet the needs of our transport system. As more vehicles transition to new technology, including electric and alternative fuels, fuel excise revenue continues to decline, leaving an ever-widening gap between the cost of maintaining our roads and the funds available to do so.”
“Road User Charges are a proven, transparent way to ensure users pay based on the actual wear and tear they place on the network. Expanding RUC to all vehicle types is the fairest and most efficient way to secure long-term, sustainable funding,” he added.