Motorists using the Logan Motorways can look forward to a day without tolls.
The Australian Competition and Consumer Commission and Queensland Motorways Limited today announced a settlement of the controversy surrounding price increases on toll roads in and around Brisbane.
The settlement includes a toll-free day for motorists, which is expected to cost QML about $80,000 in foregone revenue, and an undertaking that prices on all Brisbane tollways will not rise from current levels for a further 12 months.
"With the introduction of the Goods and Services Tax on 1 July 2000, there was a rise in the prices on all tollways in Brisbane", ACCC Chairman, Professor Allan Fels, said today. "The Gateway Bridge tolls were raised by 10 per cent to cover the GST and that toll rise is acceptable.
"However, the ACCC received many complaints from consumers pointing out that the increase in tolls at the other three toll plazas - Kuraby, Loganlea Road and Stapylton Road - were all in excess of 10 per cent. Prices rose between 11.4% and 20%. The average increase was about 13%.
"Public notices issued by QML advising motorists of the toll increase stated: 'The modifications to the price will reflect the introduction of the Commonwealth Government's 10 per cent Goods and Services Tax and minor rounding of coinage'.
"The ACCC was concerned that the toll increases could not be justified by the GST alone.
"These toll rises generated a high level of anger in the community, this was reflected in the substantial number of complaints made to the ACCC", Professor Fels said.
"Upon investigation by the ACCC, QML acknowledged that the actual increase due to the GST was 9.94% and the full price rise was not attributable to GST. Part of the increase was due to efforts to recover a proportion of costs flowing from the following factors:
additional capital works totalling $230 million since the last toll increase.
Increased operating costs since the last toll increase
Toll rates are set under legislation that requires price changes to be approved by the Minister for Main Roads. QML's franchise agreement with the State of Queensland specifically allows and anticipates toll increases in accordance with CPI, and so a formal pricing mechanism is in place to allow for CPI increases as well as GST increases, but the ACCC was concerned that QML's notices were misleading as the increase was not entirely attributable to GST and rounding.
"The ACCC hopes this will sound a warning to business, whatever the size, that they must be careful not to mislead consumers with any information relating to the introduction of the GST.
"The ACCC is determined to ensure no entity engages in price exploitation in relation to the New Tax System changes. The potential to breach the law not only flows from increasing prices beyond that made necessary by the GST, but by also failing to advise consumers that other factors have influenced price increases".
QML have entered into a Court-enforceable undertaking with the ACCC to:
provide consumers with a toll free day on the Southern Brisbane Bypass, Loganlea Road and Stapylton Road. This will take place on Wednesday 16 August 2000. This offer does not include the Gateway Bridge. The cost of this toll free day will be far greater than the extra revenue gained since 1 July 2000 by raising prices above the 9.94 per cent attributable to the GST;
QML will not seek a further toll increase on any toll road (including the Gateway Bridge) for 12 months from 1 July 2000;
QML will publish a series of corrective advertisements aimed at advising Brisbane motorists of the true nature of the price rises implemented on 1 July 2000; and
QML will implement a Trade Practices Compliance program to ensure future compliance with the price exploitation provisions of the Trade Practices Act 1974.
"The ACCC believes the offer by QML to rectify the situation by publicly acknowledging the true nature of the price increases, and offering the public a toll free day, is an appropriate way to deal with the issue", Professor Fels said.
"The ACCC notes the effort made by QML to reach a speedy resolution to the matter and an appropriate settlement which will benefit users of the tollways both in the short and long term".