The National Road Transport Association (NatRoad) has warned that a proposed fuel cost recovery mechanism being considered by the Fair Work Commission risks creating a “compliance nightmare” for small trucking businesses already under extreme financial pressure.
The warning comes as the Commission today begins hearing a major application for a road transport contractual chain order covering fuel cost recovery across the industry.
NatRoad CEO Warren Clark said while the intent to support operators was welcome, the mechanism as proposed was unworkable in practice.
“We want every transport business in this country, from fleet to owner driver, to recover their costs,” Mr Clark said.
“That’s exactly why we’re asking for this to be done properly, because a mechanism that sounds good on paper but can’t be applied in practice helps nobody.”
Mr Clark said the complexity of modern road freight movements make accurate cost recovery calculations nearly impossible for small operators.
“How does a small trucking business calculate cost recovery on a single pallet of office paper, carried on a B-double with 50 other items, for 50 different customers, dropped at different locations?” he said.
“The proposal doesn’t answer that question, and until it does, it cannot be enforced, and it cannot be complied with.”
NatRoad also warned the shift from a “fuel levy” to broader “cost recovery” obligations risks creating significant compliance burdens for operators who lack the systems and resources to calculate detailed cost structures.
“Fuel costs can change before you leave the depot. City driving means idling in traffic. Regional driving means headwinds on the highway,” Mr Clark said.
“How is a small operator supposed to calculate cost recovery for a trip before they’ve even taken it? This needs to be thought through and not rushed.”
Mr Clark said the proposal also failed to reflect the commercial realities of the industry, where a large proportion of freight is moved without formal contracts.
“You can’t impose a contractual obligation when no formal contract exists,” he said.
“Much of the road freight in this country moves on a handshake, a phone call, or a quote. That’s the commercial reality of this industry, and any workable solution has to account for that.”
NatRoad further warned that mandating standardised cost recovery could distort competition, disadvantaging smaller operators while favouring larger carriers with economies of scale.
“Competition drives efficiency in this industry,” Mr Clark said.
“We should be encouraging businesses to find smarter ways to manage costs, not designing regulations that punish those who already have.”
NatRoad is calling on the Fair Work Commission to convene an urgent, industry-wide conference to work through practical and enforceable solutions.
Those who understand how road freight actually moves in this country are the operators themselves, and they must be at the centre of this process.
It is not something that can be resolved through a rushed legal proceeding or imposed from the outside. It requires a structured, collaborative discussion with the people who run trucking businesses every day.
“We are calling on the commission to resist pressure for a rushed outcome,” Mr Clark said.
“The proposal before the Fair Work Commission is significant and complex. The industry should be given proper time to consider it, and not be expected to respond over the Easter weekend.”
NatRoad is also urging the Commission to avoid repeating past mistakes.
“The history of this industry includes the Road Safety Remuneration Tribunal, which was a well-intentioned intervention that came within days of pricing thousands of owner-drivers out of work,” Mr Clark concluded.
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