Infrastructure investment is a major priority for the current government, with several major road projects currently in the funding, planning or construction stages. Ramon Staheli is Project Director, Pricing at the National Transport Commission. Ramon will be speaking at the Major Roads Conference 2015, 18 – 19 March in Sydney.
Ramon will be taking part in the panel debate – “overcoming the struggle of insufficient infrastructure expenditure – expanding the funding pool”.
Ramon, can you tell us a little about your professional background and the path to your present role?
Early in my career, I was a policy analyst in the transport area with the New Zealand Treasury. After that, I became involved in the electricity industry. This was of particular interest to me because functioning markets have only fairly recently emerged in this area. I was fortunate to have seen the electricity industry through many different lenses including a market operator, generator and retailer. To me, there are some parallels between the road transport sector now, and the electricity sector before the major reform process, and that is one of the many reasons I joined the National Transport Commission. Improving and modifying heavy vehicle charges has the potential to play an important role in providing governments with the means to further invest in the road network.
You will be taking part in the panel on insufficient infrastructure expenditure at the Major Roads conference. Hasn’t the expenditure commitment from the current government assisted with this problem? Or is it the nature of infrastructure development that there will always be a need for more investment?
Governments make the best investment decisions they can in challenging circumstances. One of the problems is that it is getting harder for governments to fund public infrastructure, including building new roads to meet the demands of road users, from general tax revenue. On the one hand, there is strong demand for additional investment. On the other hand, there are limits to how much users are willing to pay. The main challenge is that the charges levied on vehicles (directly or indirectly) for access to the network (and the revenue collected) are not directly linked to road expenditure or investment decisions. Alternative charging regimes where revenue is directly linked to future road expenditure and where future expenditure/investment decisions are linked to road user demand and service level requirements may better meet the needs of users. We need to get to the point where we can prioritise and build road projects where users are willing to pay.
Apart from financing, what do you see as the major challenges for Australian road infrastructure projects in 2015?
This is outside my area of expertise. However, at a very high level I believe one of the most important challenges is that charges for using road infrastructure play a fairly limited role compared to other sectors. The consequence is that decision-makers on both the supply and demand side have less information to work with, making their task harder overall.